What tariffs could mean for Pennsylvania craft brewers

The big picture: The nation's craft brewing industry is coming off a third consecutive year of negative growth, a trend driven by market saturation and shifts in alcohol consumption, particularly among younger drinkers.

• And now brewers, especially small producers, are being hit by tariffs on equipment, kegs, aluminum cans and ingredients, such as hops and grain.

By the numbers: The tariffs come after craft beer production declined 4% in 2024 compared to the previous year, the largest drop in industry history outside the pandemic, per the Brewers Association.

• The number of small, independent breweries operating in the U.S. decreased for the first time in 20 years with 501 closures compared to 434 openings.

Zoom in: Craft beer is big business in the commonwealth, generating more than $5.4 billion in 2023, per state data.

• Pennsylvania had roughly 530 craft breweries last year.

What they're saying: Pennsylvania's craft beer industry has been a mixed bag, Adam Harris, executive director of Brewers of Pennsylvania, tells Axios.

• While the trade group has seen a few brewers close each month, Harris says other members are expanding production or adding second locations.

Jake Atkinson, co-founder of Human Robot Brewing in Philly, tells Axios that tariffs and fluctuating costs are top of mind for him.

• While he hasn't raised prices yet for customers, his own costs for cans, merch and raw ingredients are up. The uncertainty around costs is also preventing him from planning for the future.
• "I don't want to raise prices but I'm not going to have a choice. I pay more; the consumer pays more," he said.

Many don't yet know how tariffs will affect cost and availability of key products in the coming months, Harris says.

• But some brewers are looking at unique contract agreements to get them through the uncertainty.

🏆 1 cool thing: Four Pennsylvania craft breweries made the Brewers Association's 2024 list for the top 50 companies in terms of production.

• Pottsville-based D.G. Yuengling and Sons — the oldest brewery in the U.S. — maintained its No. 1 ranking.
• Tröegs Brewing Co. in Hershey was ranked 20th, followed by Pittsburgh Brewing Co. (25th) and Williamsport's New Trail Brewing Company (46th).

👀 What to watch: Germantown's Attic Brewing Company was recently named a finalist for the Samuel Adams Brewing & Business Experienceship.

• If selected, Attic would collaborate with Samuel Adams on a specialty beer, among other things.