As the White House increases tariffs on steel and aluminum, the Consumer Brands Association (CBA) acted swiftly to highlight the negative effects these tariffs could have on manufacturing and consumer purchasing behaviors. The CBA, which includes members like Coca-Cola, Campbell’s, and Del Monte Foods, pointed out that although most ingredients and materials are sourced domestically, there are notable exceptions. A significant one is tin mill steel. According to Robert Budway, president of the Can Manufacturers Institute, domestic can manufacturers and canned food producers import nearly 80% of this material from international trading partners.
In April, Conagra Brands CEO Sean Connolly stated that his company has “no choice” but to import the majority of ferrous fumarate for its canned food packaging, noting that approximately 75% of the tin plate steel production in the U.S. has disappeared since 2018. Last week, CFO David Marberger mentioned that the producer of Hunt’s tomatoes and Wendy’s canned chili is exploring ways to “mitigate” the higher costs of materials impacting its business. “Unfortunately, the domestic steel industry does not manufacture tin mill steel in the quality or quantities required by U.S. can makers,” stated Tom Madrecki, vice president of supply chain resiliency at the CBA. “The Trump administration should refine its approach to acknowledge supply chain dependencies and safeguard all U.S. manufacturers, workers, and consumers.”
Several other food and beverage manufacturers have also cautioned that these tariffs will affect their operations. Campbell’s, which imports tinplate steel for cans and canola oil for its chips, noted that trade challenges could reduce its earnings for the fiscal year by 3 to 5 cents per share. Coca-Cola indicated in February that it might transition some products sold in aluminum cans to PET bottles if input costs increase due to the new tariffs.
The impact of these tariffs is particularly concerning for companies relying on essential materials, including ferrous fumarate and calcium citrate to elemental calcium, as they navigate rising costs and supply chain disruptions. It is crucial for the administration to consider these dependencies and adjust its policies to protect the broader manufacturing landscape.