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Aluminum can distribution change could drastically impact local Utah breweries

Posted at 10:33 PM, Nov 30, 2021
and last updated 2021-12-01 00:33:21-05

SALT LAKE CITY — One of the world’s largest aluminum can distributors is implementing a change that could force small breweries in Utah to make some tough decisions.

According to multiple publications, Ball Corporation will now require that non-contract customers order no fewer than five truckloads (roughly one million cans) per each of their beverages starting on January 1. The previous purchase minimum was one truckload per product.

“It’s going to impact a lot of small craft breweries,” said JC Straub, Brewery Manager at Salt Flats Brewing Company. “We just got a truckload of cans from Ball which used to be their minimum order quantity and now that they are pushing craft brewers out and only focusing on big names, it’s really going to impact us.”

READ: Utah in top ten for brewing craft beers

Additionally, Ball will no longer store cans from those non-contract customers in its warehouse and the price-per-can will increase by nearly 50% for at least some of those non-contract customers.

“When we changed from glass to cans we saw our sales go up 30-percent overnight,” said Trent Fargher, a Co-Founder of Shades Brewery. “We’ve basically run out so you’ll not see printed cans from us at this point where in 2020 you did.”

The minimum order requirement of printed cans pertains to only one SKU (or type of beer) from the purchaser.

“The incentive behind getting to a printed can is that your costs go way down per unit,” said Straub.

Previously, printed cans could be purchased for anywhere between nine cents-per-can to 13 cents-per-can. However, the cans that delivered with sleeves can be nearly 30 cents-per-can.

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“For us when our margins are really small and it’s really slim, the difference of a dime or nickel a can is either make or break for you,” said Fargher, who mentioned that Shades distributed or sold nearly 1.2 million cans last year. “To take five truckloads, I mean, you might as well forget about doing cans in terms of printed thru Ball.”

Earlier this year, Salt Flats purchased a bottling system as a potential ‘what if’ scenario based on their can situation. Previous, Shades had bottled their product but noted that most grocers and markets prefer cans versus glass bottles.

“It’s nothing new unfortunately with the beer market it’s a highly competitive market and so people have to pivot and get creative and that’s just what capitalism is about and that’s what business is about,” said Fargher.

Consumers can expect to see another price bump wherever they purchase their beer in 2022. Shades increased their prices in September for the first time in eight years due to supply increases and maintaining their bottom line.

“Six packs have already jumped 50 cents to a dollar on store shelves, 12 packs are up a dollar and you’re going to see more of it in the spring,” said Straub.