Tariffs push up packaging costs

A tariff can feel abstract until it lands in the pantry. This week, U.S. food and drink companies said a new round of metal tariffs is making the cans, lids, foil seals, and other packaging around everyday groceries more expensive, and that those costs are likely to show up first on the shelf-stable foods families buy when they need dinner to be fast, cheap, and predictable. The trigger was a White House proclamation signed on April 2 and effective April 6 that tightened tariffs on imported steel, aluminum, and copper and the products made from them. (whitehouse.gov, packaginginsights.com) The new rules changed how the government taxes metal-heavy imports. Goods made almost entirely of steel, aluminum, or copper still face a 50% tariff, while many “derivative” products made substantially from those metals now face 25% on their full customs value, not just on the metal portion. Products with 15% or less of those metals are exempt, and the list of covered products can keep changing. For packaging buyers, that means more uncertainty even before a single can is filled with tomatoes, beans, soup, or beer. (whitehouse.gov, finance.yahoo.com, ghy.com) Can makers had asked for something more specific. Their complaint is simple: if an American company imports tin-coated steel or aluminum sheet and turns it into cans here, it pays the tariff. But if a foreign competitor fills those cans overseas and ships the finished canned food into the United States, that product can avoid the same hit. The Can Manufacturers Institute said its request to add filled food and beverage cans to the tariff list was denied, leaving domestic can makers and U.S. food processors paying more for inputs while imported canned goods stay relatively cheaper. (packaginginsights.com, finance.yahoo.com) This bites harder because the American can industry cannot simply switch to fully domestic supply. The specialized steel used for food cans is called tin mill steel, and U.S. producers now make far less of it than they once did. The Can Manufacturers Institute says domestic production has fallen 75% over eight years, forcing can makers and canned-food companies to import nearly 80% of the tin mill steel they use, mostly from allied countries. A tariff meant to protect metal production therefore lands on a supply chain that still depends on imports to function. (cancentral.com, packagingdive.com, regulations.gov) Aluminum has its own pressure point. In March, Packaging Dive reported that the Midwest Premium, a key surcharge built into U.S. aluminum prices, had climbed above $1 per pound for the first time. Executives at major can makers said they expected direct tariff costs in 2026 and had already been passing much of the previous year’s increases through to customers. Brewers warned that even where some items such as aluminum lids now get the lower 25% rate, higher material costs are still likely to flow through from suppliers. (packagingdive.com, finance.yahoo.com) Consumers were already feeling food inflation before this latest change. USDA said food-at-home prices in February 2026 were 2.4% higher than a year earlier and forecast grocery prices to rise 3.1% over 2026. Bureau of Labor Statistics data show food prices rose 3.1% in 2025, and nonalcoholic beverages rose even faster. In a separate grocery-tracking project cited by Packaging Dive, researchers at the University of Cincinnati found some of the sharpest late-2025 increases in canned foods. (ers.usda.gov, bls.gov, packagingdive.com) That is why packaging costs matter more than they sound. A jump in the price of a steel sheet or an aluminum coil does not stay in a mill or a factory ledger. It moves into a can of soup, a six-pack of sparkling water, a shelf-stable tomato sauce, and the backup meals households keep for rushed weeknights and tighter months. The tariff starts as a policy on metal and ends as a few more dollars at the pantry shelf. (packaginginsights.com, ers.usda.gov)