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Kick the Keg: Trump´s Tariffs Might Kill
Last American Keg Manufacturer

Reason, by Eric Boehm

Original Article

Posted By:zoidberg, 3/12/2018 2:45:35 PM

A Pennsylvania-based company that claims to be the last American manufacturer of steel beer kegs might be driven out of business by the tariffs that President Donald Trump imposed last week. On Thursday, Trump signed an executive order imposing 25 percent tariffs on steel imported into the United States (plus a 10 percent tariff on imported aluminum). The tariff will help steel makers at the expense of steel-consuming businesses like American Keg of Pottstown, Pennsylvania. "Tariffs will inadvertently drive the price of American steel higher," CEO Paul Czachor tells Philly.com´s Sam Wood. "Within a year, we might have to raise our

      


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Reply 1 - Posted by: Whamdbambam, 3/12/2018 3:03:07 PM     (No. 11569617)

What´s the social cost of welfare benefits for the entire manufacturing sectors that globalists have put out of business?

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Reply 2 - Posted by: mathman, 3/12/2018 3:28:15 PM     (No. 11569641)

And what about the social cost of the steel made by slave laborers in China? Or the subsidy which China uses to decrease the cost of their material?
Making steel takes energy. And this is bound to cost some money to somebody somewhere.
Just Buy American and get over yourself.
Globalism is a chimera and an illusion by the One World fanatics. And they are furious that Trump is taking away their toys.

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.New_S.
  


 
Reply 3 - Posted by: RedLegLeader68, 3/12/2018 3:40:17 PM     (No. 11569651)

Dang! I sure wish there were some steel mills in PA! /s

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Reply 4 - Posted by: NYbob, 3/12/2018 3:47:41 PM     (No. 11569655)

´ Might, if, maybe, ´ Paul Czachor sure is a scaredy cat. Gee, Paul, maybe you and your 20 employees will have to work differently, harder or adapt a new business plan, but get this, the entire US economy isn´t bound by what a keg manufacturer ´might´ do.

Every one of those 20 employees could find a job in the western part of PA right now, working for frackers or coal miners, IF they can pass a drug test. If your business depends on a communist state subsidized product like cheap commie steel, maybe you need a better plan.

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Reply 5 - Posted by: dvc, 3/12/2018 3:57:42 PM     (No. 11569667)

I call BS. The max possible tariff is 25%. The cost of the product is NOT going to go up 30%, and not even 25%, that is just stupid to say.

I would bet that the raw material contribution to the overall cost is probably about 20%. I will do some online quick research on this topic.

Kegs are made of stainless steel, probably 300 series. Because they weld it, probably 304L stainless. Online check shows about $2200/ton for this alloy. A ´1/2 keg´ sized keg weighs about 30 lbs. So, you make 67 of them per ton of 304L SS. That is about $33 material cost per 1/2 keg, which is offered for $127 sale price, new.
Increase this raw material cost from $33 by 25%, you get $41. So your keg price will increase from $127 to $134. I wonder if you buy many tons of SS you can´t get a much lower price than what I found online in 30 seconds?

I would imagine that a bit of marketing, like maybe a sticker "Made with American Steel" on the side of the keg might well eliminate some of the resistance to a few dollars price increase.

Saying that "our prices will increase by 30%" is either stupidity or just plain old lying for political gain.

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Reply 6 - Posted by: Chuzzles, 3/12/2018 5:17:43 PM     (No. 11569744)

I would hope that Trump pays attention to any businesses who try and use the cover of tariffs to raise their prices in a dishonest fashion. I don´t see how something made in America would be affected by tariffs unless they are trying to sell it overseas. But to sell it here in this country? I am not buying it.

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Reply 7 - Posted by: Philipsonh, 3/12/2018 5:19:15 PM     (No. 11569746)

Reply #5 - you need to reread the article. It never says the price of their kegs would go up 30%. It says their prices would be 30% higher than imports.

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R-TA-Wide_2
  


 
Reply 8 - Posted by: franq, 3/12/2018 5:33:01 PM     (No. 11569760)

Excellent analysis, #5.

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Reply 9 - Posted by: dvc, 3/12/2018 5:37:19 PM     (No. 11569764)

Thanks, #7, I did a quick read, and missed that point.

Still, IMO, the increase of a few dollars shouldn´t hurt too much. Expecially if we complain to every seller of goods when we see "made in China" on a product, and ask "can´t you find an American supplier?"

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Reply 10 - Posted by: plex, 3/12/2018 6:50:20 PM     (No. 11569847)

Using #5´s analysis, his price is already 20% higher than foreign kegs. Sounds like a pretty marginal business.

Besides! Whould not the tariff apply to steel products as well as raw steel?

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Reply 11 - Posted by: Smart11344, 3/12/2018 7:28:02 PM     (No. 11569903)

I don´t even drink a six pack of beer in a year.

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Reply 12 - Posted by: Hotrod, 3/12/2018 7:31:35 PM     (No. 11569908)

Geez, pundit world is full of trade experts! I bet they know more about fair trade than anyone! Why do they waste away, writing for some media concern, when they could be making America great again?
/s/

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.LockDme.


 
Reply 13 - Posted by: Ribald1, 3/12/2018 8:03:02 PM     (No. 11569940)

#5 you also missed the step where the alloy becomes plate to name one of a few.
We all wish we could get useable material for alloy ton pricing. If you can, you stand to make a killing.
The only purpose tariffs on raw materials have is to reduce the competiveness of US manufacturing. Period.

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Reply 14 - Posted by: dvc, 3/12/2018 8:16:54 PM     (No. 11569952)

#13, no the $2200/ton price quoted online was for 304L stainless in sheet form.

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