LITTLE ROCK, Ark. (KTHV) — Unemployment figures released Friday show continued job growth in the country, including in manufacturing. That muddies the waters as industries across the land get ready for tariffs on steel and aluminum. But Arkansas business leaders are preparing for some things to get more expensive right away.
“Question marks and uncertainty are always bad for business,” John Beachboard, co-owner of Lost Forty Brewing in Little Rock, said as he surveys pallets stacked to the ceiling with beer in aluminum cans.
A tariff on aluminum could make all those cans more expensive.
“It means the cost goes up for beer. I don't know how much. I've heard now a cent a can to which roughly means all of a sudden this inventory you're looking at here goes up like $10,000.”
Similar questions are vexing Tokusen USA in Conway. The company makes steel “wire rods” that go into tires. They can only get raw materials imported. They aren’t yet sure what that will mean for costs to consumers down the line.
“Import tariffs on our raw material threaten our business due to the competing import of our finished products,” Jim McNeal, V.P. of engineering for Tokusen, said. “Tokusen is working with coalition members of the American Wire Producers Association to petition this tariff. There is some possibility to get exemptions or exclusions, but this process is not yet defined by the federal government.”
Farmers are worried about retaliation from countries in response to tariffs. Kevin McGilton with Riceland said consumers likely won’t notice price changes for Arkansas grains. But commodities will be volatile for producers, making business planning difficult.
All these business leaders fear the unintended consequences. Like when Beachboard looks out across the 20,000 square foot brewery and sees the tanks, cookers and pipes, let alone the cans.
“It never occurred to me to ask where the steel in this tank is coming from,” he said. “Our ability to purchase tanks, to fill those tanks with beer, it affects our ability to hire and expand.”
On the flipside of all this: A company called Magnitude 7 Metals just across the border in Missouri announced today they would restart two aluminum smelters.
They credited the Trump Tariffs for allowing the business to expand.