Beer Doesn't Have a Border
On September 29, packaged Canadian beer stopped crossing into the United States. Molson, Labatt Blue, Moosehead and Kokanee will fade from American shelves as the last of the inventory sells (ProBrewer). In most of Canada, American beer has been hard to find on liquor store shelves since March 2025 (Capital Press).
That is the headline. The bigger story sits upstream, in the hops, the malt and the cans that both industries share. Brewers and growers on both sides of the border depend on the same supply chain, and every new measure adds cost somewhere along it.
This post looks at what changed, what it costs in real dollars, and what it means for the people who grow and brew North America's beer.
How we got here
The current measures built up over about eighteen months. Each government has given its own reasons, and we list them here as each side has stated them.
When | What happened | Stated reason |
March 2025 | Most Canadian provinces stop buying or selling U.S. alcohol in government liquor stores | Response to U.S. tariffs on Canadian goods |
August 22, 2026 | U.S. 50% duties take effect on a list of Canadian goods, including alcohol, hops and packaging | U.S. cites Canadian treatment of U.S. alcohol, dairy and vehicles |
September 8, 2026 | Canada's counter-tariffs of 15%, 25% or 50% take effect on 629 tariff items, about C$27.6 billion of U.S. imports | Canada describes them as matching the U.S. duties dollar for dollar |
September 29, 2026 | U.S. bans imports of packaged Canadian beer, non-alcoholic beer, wine, cider and spirits | U.S. cites continued restrictions on U.S. alcohol and Canada's new counter-tariffs |
Sources for the timeline: CRS report on Section 338 tariffs, Finance Canada counter-tariff list, Huron Chamber tariff guide, CNBC.
Two brewing industries, one market
Canada's brewing industry is mostly a domestic business. About 1,178 brewing companies operate there, in a market worth roughly $6.3 billion in 2026. Revenue has slipped about 3.3% a year since 2021 as people drink less (IBISWorld). Beer Canada says about 90% of the beer sold in Canada is brewed in Canada, and the sector supports about 149,000 jobs (CP24).
The U.S. market is many times larger. Its craft brewers rely on imported hops and malt for many specialty styles, a point the Brewers Association has made throughout this dispute (Capital Press).
Both industries were dealing with falling consumption before any of this started. The trade measures land on top of that.
What the ban covers, in dollars
The beer itself is a small number. The full U.S. ban covers nearly $1 billion a year in Canadian imports, and alcohol makes up close to 90% of it (The Gazette, ABC News). Spirits make up most of the alcohol, at about $680 million, with fermented drinks at about $220 million (DTN).
Canadian beer exports to the U.S. were about US$21 million in 2025, by UN trade data (Trading Economics). Shipments were already shrinking well before the ban.
Big brands are mostly insulated. Molson Coors has said almost all of its brands sold in the U.S. are brewed in the U.S. (inside.beer)
What's covered: packaged beer, including kegs, and non-alcoholic beer. Bulk beer shipped south to be packaged in the U.S. appears to fall outside the ban (Brewers Association, Huron Chamber guide).
The other direction: U.S. beer exports to Canada fell from about US$47 million in 2024 to about US$17 million in 2025, after most provinces pulled U.S. products (USDA FAS, Trading Economics).
The people who feel this most are small craft exporters, the importers and distributors who carried their beer, and border-region bars and stores on both sides.
The bigger cost: packaging
For most brewers, the can now matters more than the ban. North American can prices are up roughly 50% since early 2025 (The Globe and Mail). One Ottawa craft brewer told Global News his cost per can went from about 15 cents to about 35 cents (Global News).
The can's supply chain crosses the border more than once. Canada smelts aluminum with its hydroelectric power. Mills in the U.S. roll it into can sheet, and much of it comes back north as cans (AL Circle, Global News). About 80% of beer sold in Canada goes into cans, so every added cost along that route shows up in brewers' budgets.
Other packaging is now tariffed in both directions. U.S. rates come from the Huron Chamber tariff guide; Canadian rates come from Finance Canada's list.
Item | Canadian goods entering the U.S. | U.S. goods entering Canada |
Glass bottles | 50% | 50% |
Corrugated cartons and boxes | 50% | 50% |
Metal bottle caps | 50% | Not on Canada's September 8 list |
Paper labels (unprinted) | 50% | Not on Canada's September 8 list |
Canadian brewers may not pay the full Canadian rate on U.S. bottles and cartons. Canada's existing tariff relief for non-steel goods used in food and beverage packaging carries over to the September 8 counter-tariffs and runs until June 30, 2027 (Trade Commissioner Service, Norton Rose Fulbright). Brewers should confirm eligibility with a customs broker. Metal bottle caps do not appear in the base-metal groups of Canada's list (Immigration News Canada summary).
Brewers are adapting where they can. Some Canadian brewers now buy cans from China, which sell at about a one-third discount (The Globe and Mail). In British Columbia, the craft brewers' guild counts 20 brewery closures over the past year, citing costs for cans, ingredients, labour, freight and energy (AL Circle).
Hops and malt: the ingredient story
Hops are treated very differently depending on which way they cross the border.
Canadian hops going south face a 50% U.S. duty since August 22. That covers whole cones, pellets, lupulin and hop extracts (Huron Chamber guide).
U.S. hops going north face no new Canadian tariff. Hops do not appear on Canada's September 8 list (Finance Canada).
In practice, Canadian hop growers, including those in Quebec and British Columbia, now pay more to reach American brewers. Canadian brewers can still buy Pacific Northwest hops with no new duty. That matters, because Canada does not grow enough hops for its own craft brewers, and Yakima is the largest hop market in the world (Global News).
U.S. hop growers keep their Canadian customers. Those customers are under pressure, though, from can costs and slower sales.
Malt runs the other way. About 57% of Canada's malt barley exports go to the U.S., and Canada is the largest exporter of malt to American brewers (USDA FAS). Malt does not appear on either country's list right now. It is still worth watching, since few other suppliers could replace that volume quickly (The Barley Bin).
When trade rules can change within weeks, growers need a clear view of their crop, their contracts and their costs. That is the kind of planning we work on every day with hop growers, on both sides of the border.
What it means for prices
The ban itself won't raise beer prices much in either country. The pressure comes from inputs.
In Canada, the main drivers are cans, bottles and cartons, along with excise tax. Ottawa has limited the tax side for now. On April 1, 2026, it extended its 2% cap on annual alcohol excise increases for two more years. It also kept the 50% excise cut on the first 15,000 hectolitres a brewery makes (Finance Canada). Expect gradual price increases, driven mostly by packaging.
In the U.S., shoppers will see fewer Canadian labels. Overall prices should barely move, given how little Canadian beer was crossing the border. American brewers face their own higher costs for cans, kegs and imported ingredients (Capital Press).
On both sides, small brewers carry the most weight, since they have less volume to spread rising costs across.
A shared brewing heritage
North American beer has been a cross-border product for a long time.
Molson, founded in Montreal in 1786, is the oldest operating brewery in North America. John Molson brought barley seed from England and gave it to local farmers to grow his malt (CBC, Wikipedia).
Molson and Coors merged in 2005, joining a Montreal brewery with one from Golden, Colorado. Coors introduced the aluminum beer can in 1959, the same year Molson Canadian launched (Molson Coors).
Canadian barley in American lagers. Almost all of Canada's six-row malting barley exports go to the U.S., much of it to Anheuser-Busch for Budweiser (Top Crop Manager).
American hops in Canadian ales. Pacific Northwest hops give many Canadian craft IPAs their character (Global News).
The ingredients, the packaging and the companies themselves have moved back and forth across this border for generations.
What beer can learn from other industries
Beer is not the first industry to find its supply chain in the middle of a trade dispute. Autos and metals went through it first, and their experience offers useful lessons for growers and brewers.
Autos. Some car parts go back and forth across the border seven or eight times before final assembly (CBC). NBC followed a striker plate made in Windsor, Ontario, that crosses the border four times during production (NBC News). The U.S. has said tariffs on Canadian vehicles and parts will rise from 25% to 50% on January 1, 2027 (CNBC).
Steel and aluminum, 2018 to 2019. The U.S. put a 25% tariff on Canadian steel and 10% on aluminum in June 2018. Canada answered with its own tariffs in July, and both sides lifted them on May 20, 2019 (EDC). While they were in force, tariffed exports to the U.S. fell by about half, and U.S. importers paid the full cost through higher prices (Statistics Canada). In the month after the tariffs ended, Canadian aluminum exports to the U.S. grew 47% (BNN Bloomberg).
Five lessons for hops and beer
Lesson | Where it comes from | What it means for hops and beer |
Show how connected the supply chain is | U.S. customs exempted CUSMA-compliant auto parts in 2025, after the industry explained how often parts cross the border (CBC) | Growers and brewers can document how hops, malt and cans move, so officials on both sides see the whole chain |
The buyer often pays | U.S. importers paid the full cost of the 2018 metals tariffs (Statistics Canada) | Expect costs to land on brewers and drinkers, not only on exporters |
Disputes can end, and trade can return fast | The metals tariffs lasted under a year, and aluminum exports rebounded within a month (BNN Bloomberg) | Keep customer relationships alive across the border, even while sales are slow |
Some businesses don't come back | Some tariffed steel producers left the U.S. market altogether and halted operations (Statistics Canada) | Small hop farms and craft brewers have the least room to wait it out, so planning matters most for them |
Use the relief that exists | Canada's tariff relief for food and beverage packaging runs to June 30, 2027 (Trade Commissioner Service) | Brewers and growers should review remission and support programs on both sides now |
Statistics Canada also warns that today's tariffs are higher, less predictable and possibly longer lasting than in 2018, so a quick recovery is not guaranteed (Statistics Canada).
Where this leaves growers and brewers
Beer in North America runs on a supply chain neither country can easily replace. Canadian aluminum and barley, American can sheet and hops, and brewers on both sides all depend on each other.
We don't know how or when the negotiations will end. The growers and brewers who know their crops, contracts and costs in detail will be best placed to adjust as the rules change.
If you grow or brew on either side of the border, we'd like to hear how this is affecting you. Reach out to us at TensoAI.
Trade measures are changing quickly. Figures are current as of October 2, 2026.
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