Meadowlark Brewing founder and owner Travis Peterson is standing behind a bar at his new location in west Billings. Around him, construction crews are putting the finishing touches on empty rooms that could soon be a restaurant, barbershop and playroom.
“We are about 14 months behind where we initially thought we’d be open and operating," Peterson said.
The Sidney brewery, one of roughly 100 breweries in the state, was on the verge of expanding to Billings when the pandemic began. Peterson says Meadowlark lost a funding source and hit delays in getting permits and other materials a brewery needs to function — like cans.
“You had all these small producers buying up canning lines as fast as they could, trying to put cans in, and now we're all in the same boat of nobody can get cans. Or, if we can get them, they’re at a much higher price,” said Peterson. “You combine that with increased costs and freight, and aluminum is not so great an option as it once was three or four years ago.”
A clog in global supply chains for materials like aluminum is hitting industries here in Montana. Craft breweries are the latest businesses to feel the impact, and their customers could soon feel it too.
The demand for aluminum cans soared at the beginning of the pandemic as consumers transitioned to drinking at home and businesses turned to takeaway options to keep afloat. That, combined with competition from the rest of the beverage industry, left craft brewers scrambling to put in orders with middleman companies or turning to online forums — like Peterson did.
“I certainly reached out to people around here," he said. "I’ve bought cans from other breweries… So, I just spent a lot of time on the internet and the phone calling people and trying to get some pricing that would work for us.”
Meadowlark also bought a labeling machine to apply graphics, which allows the business to re-label already printed cans.
The price for aluminum rose to a roughly ten-year high this year, and demand still remains.
Peterson says in recent months, the cost per can has increased a few cents over what he’d budgeted.
“Which doesn’t seem a lot,” he said. “But when we’re talking about for 16 ounce cans, that’s over 6,000 cans per palette, and a minimum is 25 palettes. Yeah, that extra cost, that extra 4 or 5 grand per semi-load has got to come from somewhere.”
And that extra cost will start to trickle down: Peterson said customers may start to see higher prices for both drafts and packs of beer.
Bart Watson is the chief economist for the Brewers Association, a trade group that works with small and independent brewers nationwide. He says the availability and cost of aluminum cans have been a couple of the most consistent issues brewers have grappled with throughout the pandemic, and the manufacturing stage is where small brewers feel the biggest impact.
“Can manufacturing is a business that is built on scale,” he said. “Small brewers are not the scale that manufacturers typically built their plants around or are looking to work with.
"So, you have this mismatch where you have huge can manufacturers that want runs that are as long as possible, and small brewers who make a variety of very small niche products.”
MAP Brewing Company in Bozeman was on a waitlist this fall to order directly from one of the nation’s largest can manufacturers, Ball, when the supplier increased its minimum order requirements from one truckload to five, or a million cans per order. That puts ordering from Ball out of reach for most of Montana’s brewers. YPR reached out to Ball for this story, but a spokesperson failed to reply by deadline.
MAP owner Patrick Kainz says that means the brewery will continue to work through a middleman company, whose wait times for products have roughly doubled since the pandemic began.
“They seem to be getting longer and longer,” Kainz said. “And now with Ball putting out the new information on their higher minimum order amounts, I am anticipating and planning for longer lead times because there’s going to be so many more breweries in the market with third party suppliers to fulfill their needs.”
Kainz says MAP — like many other small breweries — has already increased what customers pay for kegs, and a boost in the price of a six-pack may follow.
