• 13 hours Economists Call For Recession In 2021
  • 15 hours Hong Kong Billionaire Loses Big On Canadian Energy Play
  • 19 hours Trade Tensions Weigh On South Korea, Japan Relations
  • 2 days Lithium Hype Can't Live Up To Supply Realities
  • 2 days Tesla Scrambles To Salvage Its Stumbling Solar Business
  • 3 days Why Silicon Valley Is Moving To Toronto
  • 3 days Hong Kong Residents Are Fleeing To Taiwan At A Record Pace
  • 3 days Trickle Down Tax Cuts Aren't Helping Bolster GDP Growth
  • 3 days Wealth Gap Widens Between Baby Boomers And Millennials
  • 4 days How Investors Are Playing Uncertain Markets
  • 4 days Demand For Cash Is On The Rise
  • 4 days The Best Way To Ride The Gold Rally
  • 5 days Corn Industry Reeling After Shocking Ethanol Decision
  • 5 days Gold Miners Eye Further Upside
  • 6 days Alibaba Exec Sets Record With $3.5 Billion Brooklyn Nets Purchase
  • 6 days Smart Contracts: The Tech Reshaping Entire Industries
  • 7 days Protests Threaten $5 Billion Peruvian Copper Mine
  • 8 days Why Wealthy Kids Are Getting Into College For Free
  • 8 days Is Is Too Late To Get Into The New Gold Boom?
  • 8 days Solar Tech Breakthroughs Spark Surge In Adoption
  1. Home
  2. Markets
  3. Economy

Mexican Tariffs Could Cause Corona And Modelo Beer Prices To Spike

Broken Corona bottle

Last Thursday, President Trump tweeted he would impose a 5% tariff on all goods coming from Mexico starting next Monday [June 10] "until such time as illegal migrants coming through Mexico, and into our Country, STOP." The tariff, if authorized by the White House, could make popular Mexican beer like Corona and Modelo, a whole lot more expensive for American consumers, reported CNBC.

Trump tweeted: ''On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied,..''
 
A statement published by the White House said tariffs on Mexican imports would surge to 25% if the immigration crisis at the border is not resolved immediately.

A senior Mexican delegation will start high-level immigration talks on Monday in Washington to hopefully resolve the issue and thwart tariffs.

The announcement of possible duties gaped down Constellation Brands' stock 8% at one point last Friday.

According to Morgan Stanley, 75% of Constellation Brand's beer portfolio is "entirely imported" from Mexico. MS said in a research note to investors that a 5% tariff would cut 4% rom the company's bottom line. In the case of a 25% tariff rate, well, the company's profits would collapse by 19%.

Jim McGreevy, president and CEO of the Beer Institute, spoke with the Chicago Tribune who said tariffs on Mexico would harm the American trucking industry and farmers along the supply chain if Mexican brewers see a decline in activity. US farmers exported $209 million in barley to Mexican beer producers last year, McGreevy said.

It's likely that the importer on record will pass along the tariff in the form of higher prices to consumers. The beer industry has already been slapped with $349 million in additional costs thanks to President Trump's steel and aluminum tariffs.

Chicago-based MillerCoors, which imports the Mexican beer Sol, would be another beer to see possible price hikes if the tariffs went through next week. Heineken, which imports Dos Equis and Tecate, are more beers that could see price hikes. Anheuser Busch InBev, which imports Mexican beer Estrella Jalisco, could also see increased prices.

To "Make America Great Again," consumers will have to pay up for their favorite Mexican beers - at what point does the blue collar worker, living paycheck to paycheck, start noticing soaring prices thanks to President Trump's trade war?

By Zerohedge.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment