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Bud brewer hopeful that aluminium tariffs won't hit U.S. allies

Published 2018-04-25, 10:07 a/m
© Reuters.  Bud brewer hopeful that aluminium tariffs won't hit U.S. allies
ABI
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BRUSSELS, April 25 (Reuters) - Anheuser-Busch InBev ABI.BR, the world's largest brewer, is hopeful that the United States will grant permanent exemptions to aluminium imported from allies and wants U.S. Congress to look into price spikes that have already set in.

U.S. President Donald Trump last month imposed import tariffs of 25 percent on steel and 10 percent on aluminium, but provided temporary exemptions until May 1 for the European Union, Canada, Mexico, Argentina, Brazil, Australia and South Korea.

Carlos Brito, chief executive of Budweiser-maker AB InBev, which sells many of its beers in the United States in aluminium cans, said the company had been very disappointed by the introduction of tariffs, which he said had put U.S. manufacturers at a disadvantage.

"We are very hopeful on the other hand that the list of allies continues to get populated because then you could maybe get to the situation where 80 percent of the aluminium supply - Canada being the biggest supplier - could be exempted from the tariff," Brito said after a meeting of the company's shareholders on Wednesday.

The brewing chief also said he was concerned about a spike of what is known as the Midwest premium, a surcharge to cover aluminium delivery.

The CME front-month Midwest premium contract AUPc1 has more than doubled from 9.4 cents per lb at the start of January to its current 21.5 cents.

"The other thing on which we are hopeful is that the U.S. Congress sheds light on the Midwest premium," Brito told reporters.

Brito said the price was normally linked to market fundamentals and recalled that it last surged in 2015 due to speculation, prompting Congress to intervene.

"It went down to fundamentals as it should be and now it's again way up, disconnected from fundamentals. So we'd love it if the U.S. Congress would take an interest," he said.

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