Molson Coors Brewing Co. chairman Pete Coors is grabbing headlines for the second consecutive week.
Now, Coors has scored himself an op-ed in the Wall Street Journal, and he’s turned his focus toward President Donald Trump and a recently imposed 10 percent tariff on imported aluminum.
In the piece, Coors urged President Trump, who he referred to as a “shrewd businessman,” to end the Midwest Premium, which he called a “mysterious fee” added to all U.S. aluminum orders.
“It is time to fix this mess and end the premium once and for all,” he wrote. “A private solution would be best — one crafted by producers, buyers, market makers and customers like Molson Coors. Let us forge a new deal on aluminum, to the benefit of a hundred million fans of the most American of beverages. President Trump, are you with us?”
The Midwest Premium, which is determined through a survey of traders conducted by Standard & Poor’s-owned company Platts, is supposed “to cover the cost of transporting, storing and delivering the metal.” However, according to Coors, the Midwest Premium has increased by 140 percent since January, to 23 cents per pound, even though the tariffs did nothing to increase the costs that the premium tracks.
“That 23 cents per pound is 28 percent of the cost of aluminum at MillerCoors — and we buy half a billion pounds of it every year,” he wrote. “This artificially inflated premium could cost us tens of millions of dollars each year, far more than the cost of the new Trump tariff.”
In a press release issued earlier this month, Beer Institute (BI) president and CEO Jim McGreevy called for a “fair and transparent pricing system for aluminum.”
“Industries thrive when there is predictability and accountability in the metals market,” he said. “The Department of Commerce and Department of Justice should investigate the unregulated Midwest Premium to ensure pricing irregularities and other unfair market practices do not disproportionately have a harmful effect on end users of aluminum.”
McGreevy also recently appeared on Bloomberg Markets’ “Balance of Power” to discuss the impact of aluminum tariffs on those within the beer industry. In advocating for “some mitigation or repeal of the tariffs,” McGreevy called out the Midwest Premium saying, “there is no stability to it, and it is created by one company, in secret, with the input of aluminum producers and aluminum traders who have an interest in seeing a high Midwest Premium.”
In his WSJ op-ed, Coors added that commodities firms are hoarding aluminum, and he pointed to an April 25 CNBC report that said 2 million tons of aluminum are being stockpiled throughout the U.S. by firms waiting to sell when prices spike. That’s three times the amount of aluminum produced annually in the U.S.
In March, four beverage trade groups — the Beer Institute, Brewers Association, Can Manufacturers Association and American Beverage Association — sent a letter to Secretary of Commerce Wilbur Ross citing “major concerns” over the tariffs’ potential to cause “price-gouging within aluminum markets.”
“Rather than being a measure of the cost of storing and shipping aluminum, the MWP [Midwest Premium] has become a device to artificially raise the price paid for aluminum by end users, and to enrich producers, traders, and other market participants,” the groups wrote.
The trade associations have collectively asked the Trump administration to exclude aluminum can sheet from the tariff.
According to The New York Times, the Commerce Department has received more than 8,200 exemption requests from companies that import foreign aluminum and steel in the two months since the tariffs were imposed.
Trump has temporarily exempted the European Union, Mexico and Canada from the tariffs through June 1.
The Beer Institute has stated that the aluminum tariff amounts to a $347 million tax on American brewers and could lead to the loss of more than 20,000 jobs.
Coors, in his op-ed, wrote that “as a leader in the $100 billion-a-year U.S. beer business, I’m deeply concerned about a possible pullback in expansion, acquisition and innovation in the industry.”