How Tariffs are Changing the Beer Landscape. Who is affected? Who is being hurt the most? Crafting Spirits: The Vision Behind “Before the Barrel Distillery”
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Episode Transcript
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Speaker 1 (00:08):
This is Beverage Chronicles, where every glass tells a story.
I'm your host, Gary Monterroso each week we'll explore the
drinks that bring people together, from craft beers and fine
wines to spirits, cocktails, coffee and beyond. We'll meet the makers,
hear their journeys, get the latest news, and discover what's
(00:31):
pouring into the future. So raise a glass and join
me for another chapter of Beverage Chronicles. I want to
start today's show by talking a bit about the impact
of tariffs on beer imports and the industry at large.
You know, for beer importers, tariffs have already had an
(00:52):
effect on their sales. Sales had dropped for several years,
but began rebounding in twenty nineteen, and then we had
COVID nineteen which interrupted. Now those importers are getting hit
with a double whammy, including inflation concerns. So what can
an importer do well. Most have increased their inventory in
(01:15):
the first months of the year, and some have taken
a less profit margin on certain beers. Ultimately, the rate
of tariffs will force higher prices and cost saving measures
like a reduction in staff. The picture for imported beer
showed a significant decline the spring. Year over year, imported
(01:38):
beer fell fourteen point nine percent for the month, according
to the Beer Institute. For the year, total imports have
declined four point nine percent. Now, Mexican beers have been
most influenced by the tariffs and the upheaval in the
Latin community, which comprises roughly fifty percent of buyers. Mexican
(02:04):
beer imports have dropped three point nine percent this year
to ten point ninety six million barrels. Modello and Corona,
the two top selling Mexican beers of Constellation brands, have
been the hardest hit. In its quarterly reporting, Constellations said
shipments of all its Mexican brands, including Pacifico and Victoria,
(02:29):
declined three point three percent and depletions that sales to
retailers declined two point six percent. Given that negotiations over
tariffs are unpredictable, here are some of the fundamental questions
faced by beer importers, their distributors, retailers, and consumers. Question one,
(02:53):
what are the current tariffs? A ten percent tariff on
all imported alcohol, including beer, was announced by the Trump
administration on April fifth. Additional tariffs have been added to
alcohol imports from two of the most popular sources of
imported beer the European Union at twenty percent and Japan
(03:18):
twenty four percent. Imported beers from Mexico and Canada are
not subject to the additional tariff due to the pre
existing trade agreement with the United States. Question two, Can
producers and importers absorb some of the increases resulting from tariffs?
(03:40):
Brewers can and do offer to help U S importers
by voluntarily lowering their wholesale price, but there is a
limit on how much producers can shave their margins to
accommodate exporting to the U S. Likewise, importers can try
to reduce margins to avoid motivating consumers to change their preferences.
(04:05):
The bottom line, the originally announced tariffs are stiff enough
that price increases are inevitable for all imported beer without
a major policy change at the federal level, which seems unlikely.
How does the wild card of aluminum tariffs influence imports
(04:26):
of canned beer? All beer imported in cans face and
additional aluminum tariff, which amounts to roughly five cents per
can by simply paying the tariff. It is an easier
headache to resolve compared with US based brewers trying to
source aluminum cans, whose availability will diminish along with higher
(04:52):
prices thanks to the blanket tariffs on aluminium imports to
the US first announced in April. Next question is how
much are the tariff increases and disruption among the Latin
community in the U s herding importers. While the biggest
importers of beer from Mexico and Latin America, such as
(05:15):
Constellation brands, as well as the smallest are affected by
the tariffs and emigration issues after years of steady growth,
both are having a dramatic impact on the bottom line.
The downturn in demand results from the change in buying
behavior in the Hispanic segment. For all importers whose source
(05:38):
beers from Mexico and Latin America, the Latins form the
largest buying segment, their buying habits have changed radically. Such
consumers are no longer frequenting restaurants and bars as often,
causing the income in this segment to be disrupted. And next,
(06:02):
how are importers of specialty beers being challenged by the tariffs.
The importers of the brands from the traditional cradles of beer,
and that would be Belgium, Germany, the United Kingdom, and
the Czech Republic began to see increased sales in the
late twenty teens after American craft beer had peaked, but
(06:27):
earlier this year, the anticipation of changes in tariff policy
slowed the flow of imported beer among distributors and retailers
even before the formal announcement of new tariffs. The bottom line,
it's a complex broom. The beer tariff situation shows how
(06:51):
trade policy can hit small businesses in unexpected ways. The
current administration ultimately designed the tariffs to help domestic industries,
but they're squeezing beer importers hard and driving up prices
for consumers who just want access to international brands. The
(07:12):
timing could not be worse for importers. After years of
American craft beer dominating everything, imported specialty beers were finally
gaining ground again. Now these tariffs threaten to kill that
momentum before it really takes off. Restaurants will likely cut
international options from their beer lists, Consumers will face higher
(07:37):
prices and will probably see fewer choices on store shelves.
And now here is my co host Michelle Lamb.
Speaker 2 (07:49):
Hi rewe welcome to Beverage Chronicles. This is your co host,
Michelle Lamb, and today we are so honored to have
the founder in C. L. Burney before the Barrel Distilled.
How are you today?
Speaker 3 (08:01):
I'm doing great, Michelle. How are you doing doing well?
Speaker 2 (08:04):
So the listeners are very curious as to your brand
and how it was inspired in the creation. Can you
tell us a little bit more about that? Yeah?
Speaker 4 (08:13):
Absolutely, So my business is before the Barrel Distillery and
were located in Erie, Pennsylvania. So I grew up in
the area before going off to college where I got
a degree in chemical engineering and then bounced around a
handful of places where I worked in the chemical distillation industry,
and then kind of when COVID hit, I kind of
wanted to change in career paths, so I moved back
(08:35):
home and actually just bought a small still and started
making liquor in the garage for a little bit. After
doing that, I eventually decided to try to make a
COVID as a business and just kind of grew from there.
I opened up a small store in twenty twenty two
and have it's been kind of slowly growing into what
we are today, which is basically a focus or a
(08:56):
distillery focusing on unaged spirits.
Speaker 2 (08:59):
That's very interesting. Can you tell us more about the spirits,
what are they and what exactly are you showcasing from
the creation from your distillery. Yeah.
Speaker 4 (09:10):
Absolutely, So we really focus on the unaged spirits, which
is kind of where the name before the Barrel comes from.
So as I'm sure a lot of people are familiar with,
you know, whiskey is basically a liquor that is distilled
and then put in a barrel for some number of
years to give that character and flavor. So for us
starting out, we didn't want to wait those number of
years or we wanted to get right going, so we
(09:31):
made the decision to kind of focus on selling people
our spirits before the barrel, which is basically anything unaged,
whether that be a white corn liquor a white rum,
even a spiced rum, or a lot of flavored moon
giants as well, are kind of the focus of our spirits,
really focusing on that quality distilled product that tastes great
(09:52):
just right off the still, or is flavored and can
be manipulated in a variety of ways to make a
variety of unique products.
Speaker 2 (10:00):
That is really interesting to me because I have the
w set background in spirits, so this is definitely something
that I'm learning every day. But for the audience that
are listening, I think what they would be curious about
is how many products are you producing, like all those
brands out there for us to purchase or is this
something that we can see in the stores. Can you
(10:22):
tell us a little bit more about that?
Speaker 4 (10:23):
Yeah, so right now, we're very small, small scale, and
you know, on navigating the liquor industry is a very
complex legal thing. So we're here in Pennsylvania and we
have our physical location. We don't really distribute at this point,
so we're really a very small mom and pop you know,
kind of have to come and find this kind of thing.
But we have our before the Barrel brand, which produces
(10:44):
a little of our twenty different unique products from flavored moonshines,
Rum's gin as.
Speaker 3 (10:51):
Well as some other corn based spirits and things like that.
Speaker 2 (10:55):
And have you actually done any tastings within Pennsylvania or
or is it outside of the state as well? How
can we find your products? Yeah?
Speaker 3 (11:05):
So, with the way the liquor are the laws work.
Speaker 4 (11:08):
Right now, we're only licensed to sell within Pennsylvania, so
we we do quite a bit around the Erie area
and branching out towards you know, the Pittsburgh and Central PA.
But unfortunately we're kind of constrained to Pennsylvania at the moment.
We do have a physical storefront where people are able
to come and do tastings and try out our spirits there.
Speaker 2 (11:26):
And I do see on your website, which is well developed,
a lot of information flavored moonshine. So can you tell
us maybe your top sellers and the ones that are
your favorites.
Speaker 4 (11:39):
Yeah, so we've got a pretty large variety, like you saw.
Similar big sellers are ones like our assalta kernel pecan,
which has a very sweet, almost butterscotchy flavor. We do
a black and blueberry moonshine which is a BlackBerry and
blueberry which is great for mixing. And then one of
the ones that is very polarizing but I think is
a personal favorite is our hot pepper honey, which uses
(12:01):
klipana and habnero concentrates to get a really nice heat
to it that kind of overrides the burn of the
alcohol and gives you more of that pepper lingering burned
to it.
Speaker 2 (12:10):
That's really interesting. So can you tell me a little
bit more about the moonshine background. Is this something that
we can create cocktails with?
Speaker 1 (12:17):
Oh?
Speaker 3 (12:17):
Absolutely.
Speaker 4 (12:19):
We use the word moonshine because it kind of gives
us that flexibility to do what we want with the spirits.
If you look into the labeling aspect and the TTP
and regulations, you know, there's very strict guidelines for what
can be called a vodka or a whiskey or a
bourbon and things like that. So we gravitated towards that
moonshine name because it really doesn't have those kind of
(12:39):
constraints in terms of what can be called that. So
I always think of my products as kind of a
mix between a liqueur and a flavored vodka, where they
might not be as harsh or quite as strong as
a vodka, but they're a bit stronger than a you know,
a cordiale or the core.
Speaker 3 (12:55):
So kind of that happy little middle ground.
Speaker 2 (12:57):
Wow, that's amazing. Do you guys have any plans like
what's next for you guys in terms of development of flavors?
Speaker 4 (13:05):
Yeah, so we're constantly trying to make new flavors and
things like that. We recently made one that's the smallest flavor,
and I think one of the next ones is going
to be either you know, coffee or pickle or something
like that to kind of catch on to some of
those flavor profiles. But we're constantly trying to develop new
flavors and utilize new techniques and all that kind of stuff.
Speaker 2 (13:25):
Wow, that's amazing. I can't wait to try them.
Speaker 3 (13:29):
Yes, we're excited. I mean, it's one of the things.
We started out.
Speaker 4 (13:32):
We had I think two flavors when we opened our
first for the first time, and now we've grown to,
like I said earlier, over twenty different flavors. So it's
definitely been a growth process and it's it's one of
the more exciting parts of my job is you know,
making those new flavors and figuring out the new things
that we can do.
Speaker 2 (13:48):
Amazing. So can you tell listeners where can they find
your products?
Speaker 3 (13:52):
Yeah?
Speaker 4 (13:52):
So we are located in Area, Pennsylvania on eighty six
fifty one Watsburg Road, which is just south of I ninety,
the main interstate that run if you're on from Boston
to Seattle. So yeah, unfortunately, I have to come to
us to get our products. Right now, hopefully In the
future we'll expand to the point where we.
Speaker 3 (14:08):
Can ship and get into some other places.
Speaker 4 (14:10):
Nationwide, but right now, our physical location is the place
to be well.
Speaker 2 (14:15):
Thank you so much Bernie for your information and being
on the Beverage Chronicle show.
Speaker 3 (14:21):
Yep, absolutely thank you for having me.
Speaker 2 (14:22):
Thank you so everyone you have heard him from Bernie
and also online and being there to visit to try
their products. Thank you so much for listening, and until
next time, cheers.
Speaker 1 (14:34):
That's all for this edition of Beverage Chronicles. I want
to thank you for joining me on this journey through
the world of drinks and the people who bring them
to life. If you enjoyed the day's show, be sure
to tune in next time for more stories, more flavors,
and more discoveries in every glass. Until then, I'm Gary
(14:56):
montroso thanks for listening and cheers.
This is Beverage Chronicles, where every glass tells a story.
I'm your host, Gary Monterroso each week we'll explore the
drinks that bring people together, from craft beers and fine
wines to spirits, cocktails, coffee and beyond. We'll meet the makers,
hear their journeys, get the latest news, and discover what's
(00:31):
pouring into the future. So raise a glass and join
me for another chapter of Beverage Chronicles. I want to
start today's show by talking a bit about the impact
of tariffs on beer imports and the industry at large.
You know, for beer importers, tariffs have already had an
(00:52):
effect on their sales. Sales had dropped for several years,
but began rebounding in twenty nineteen, and then we had
COVID nineteen which interrupted. Now those importers are getting hit
with a double whammy, including inflation concerns. So what can
an importer do well. Most have increased their inventory in
(01:15):
the first months of the year, and some have taken
a less profit margin on certain beers. Ultimately, the rate
of tariffs will force higher prices and cost saving measures
like a reduction in staff. The picture for imported beer
showed a significant decline the spring. Year over year, imported
(01:38):
beer fell fourteen point nine percent for the month, according
to the Beer Institute. For the year, total imports have
declined four point nine percent. Now, Mexican beers have been
most influenced by the tariffs and the upheaval in the
Latin community, which comprises roughly fifty percent of buyers. Mexican
(02:04):
beer imports have dropped three point nine percent this year
to ten point ninety six million barrels. Modello and Corona,
the two top selling Mexican beers of Constellation brands, have
been the hardest hit. In its quarterly reporting, Constellations said
shipments of all its Mexican brands, including Pacifico and Victoria,
(02:29):
declined three point three percent and depletions that sales to
retailers declined two point six percent. Given that negotiations over
tariffs are unpredictable, here are some of the fundamental questions
faced by beer importers, their distributors, retailers, and consumers. Question one,
(02:53):
what are the current tariffs? A ten percent tariff on
all imported alcohol, including beer, was announced by the Trump
administration on April fifth. Additional tariffs have been added to
alcohol imports from two of the most popular sources of
imported beer the European Union at twenty percent and Japan
(03:18):
twenty four percent. Imported beers from Mexico and Canada are
not subject to the additional tariff due to the pre
existing trade agreement with the United States. Question two, Can
producers and importers absorb some of the increases resulting from tariffs?
(03:40):
Brewers can and do offer to help U S importers
by voluntarily lowering their wholesale price, but there is a
limit on how much producers can shave their margins to
accommodate exporting to the U S. Likewise, importers can try
to reduce margins to avoid motivating consumers to change their preferences.
(04:05):
The bottom line, the originally announced tariffs are stiff enough
that price increases are inevitable for all imported beer without
a major policy change at the federal level, which seems unlikely.
How does the wild card of aluminum tariffs influence imports
(04:26):
of canned beer? All beer imported in cans face and
additional aluminum tariff, which amounts to roughly five cents per
can by simply paying the tariff. It is an easier
headache to resolve compared with US based brewers trying to
source aluminum cans, whose availability will diminish along with higher
(04:52):
prices thanks to the blanket tariffs on aluminium imports to
the US first announced in April. Next question is how
much are the tariff increases and disruption among the Latin
community in the U s herding importers. While the biggest
importers of beer from Mexico and Latin America, such as
(05:15):
Constellation brands, as well as the smallest are affected by
the tariffs and emigration issues after years of steady growth,
both are having a dramatic impact on the bottom line.
The downturn in demand results from the change in buying
behavior in the Hispanic segment. For all importers whose source
(05:38):
beers from Mexico and Latin America, the Latins form the
largest buying segment, their buying habits have changed radically. Such
consumers are no longer frequenting restaurants and bars as often,
causing the income in this segment to be disrupted. And next,
(06:02):
how are importers of specialty beers being challenged by the tariffs.
The importers of the brands from the traditional cradles of beer,
and that would be Belgium, Germany, the United Kingdom, and
the Czech Republic began to see increased sales in the
late twenty teens after American craft beer had peaked, but
(06:27):
earlier this year, the anticipation of changes in tariff policy
slowed the flow of imported beer among distributors and retailers
even before the formal announcement of new tariffs. The bottom line,
it's a complex broom. The beer tariff situation shows how
(06:51):
trade policy can hit small businesses in unexpected ways. The
current administration ultimately designed the tariffs to help domestic industries,
but they're squeezing beer importers hard and driving up prices
for consumers who just want access to international brands. The
(07:12):
timing could not be worse for importers. After years of
American craft beer dominating everything, imported specialty beers were finally
gaining ground again. Now these tariffs threaten to kill that
momentum before it really takes off. Restaurants will likely cut
international options from their beer lists, Consumers will face higher
(07:37):
prices and will probably see fewer choices on store shelves.
And now here is my co host Michelle Lamb.
Speaker 2 (07:49):
Hi rewe welcome to Beverage Chronicles. This is your co host,
Michelle Lamb, and today we are so honored to have
the founder in C. L. Burney before the Barrel Distilled.
How are you today?
Speaker 3 (08:01):
I'm doing great, Michelle. How are you doing doing well?
Speaker 2 (08:04):
So the listeners are very curious as to your brand
and how it was inspired in the creation. Can you
tell us a little bit more about that? Yeah?
Speaker 4 (08:13):
Absolutely, So my business is before the Barrel Distillery and
were located in Erie, Pennsylvania. So I grew up in
the area before going off to college where I got
a degree in chemical engineering and then bounced around a
handful of places where I worked in the chemical distillation industry,
and then kind of when COVID hit, I kind of
wanted to change in career paths, so I moved back
(08:35):
home and actually just bought a small still and started
making liquor in the garage for a little bit. After
doing that, I eventually decided to try to make a
COVID as a business and just kind of grew from there.
I opened up a small store in twenty twenty two
and have it's been kind of slowly growing into what
we are today, which is basically a focus or a
(08:56):
distillery focusing on unaged spirits.
Speaker 2 (08:59):
That's very interesting. Can you tell us more about the spirits,
what are they and what exactly are you showcasing from
the creation from your distillery. Yeah.
Speaker 4 (09:10):
Absolutely, So we really focus on the unaged spirits, which
is kind of where the name before the Barrel comes from.
So as I'm sure a lot of people are familiar with,
you know, whiskey is basically a liquor that is distilled
and then put in a barrel for some number of
years to give that character and flavor. So for us
starting out, we didn't want to wait those number of
years or we wanted to get right going, so we
(09:31):
made the decision to kind of focus on selling people
our spirits before the barrel, which is basically anything unaged,
whether that be a white corn liquor a white rum,
even a spiced rum, or a lot of flavored moon
giants as well, are kind of the focus of our spirits,
really focusing on that quality distilled product that tastes great
(09:52):
just right off the still, or is flavored and can
be manipulated in a variety of ways to make a
variety of unique products.
Speaker 2 (10:00):
That is really interesting to me because I have the
w set background in spirits, so this is definitely something
that I'm learning every day. But for the audience that
are listening, I think what they would be curious about
is how many products are you producing, like all those
brands out there for us to purchase or is this
something that we can see in the stores. Can you
(10:22):
tell us a little bit more about that?
Speaker 4 (10:23):
Yeah, so right now, we're very small, small scale, and
you know, on navigating the liquor industry is a very
complex legal thing. So we're here in Pennsylvania and we
have our physical location. We don't really distribute at this point,
so we're really a very small mom and pop you know,
kind of have to come and find this kind of thing.
But we have our before the Barrel brand, which produces
(10:44):
a little of our twenty different unique products from flavored moonshines,
Rum's gin as.
Speaker 3 (10:51):
Well as some other corn based spirits and things like that.
Speaker 2 (10:55):
And have you actually done any tastings within Pennsylvania or
or is it outside of the state as well? How
can we find your products? Yeah?
Speaker 3 (11:05):
So, with the way the liquor are the laws work.
Speaker 4 (11:08):
Right now, we're only licensed to sell within Pennsylvania, so
we we do quite a bit around the Erie area
and branching out towards you know, the Pittsburgh and Central PA.
But unfortunately we're kind of constrained to Pennsylvania at the moment.
We do have a physical storefront where people are able
to come and do tastings and try out our spirits there.
Speaker 2 (11:26):
And I do see on your website, which is well developed,
a lot of information flavored moonshine. So can you tell
us maybe your top sellers and the ones that are
your favorites.
Speaker 4 (11:39):
Yeah, so we've got a pretty large variety, like you saw.
Similar big sellers are ones like our assalta kernel pecan,
which has a very sweet, almost butterscotchy flavor. We do
a black and blueberry moonshine which is a BlackBerry and
blueberry which is great for mixing. And then one of
the ones that is very polarizing but I think is
a personal favorite is our hot pepper honey, which uses
(12:01):
klipana and habnero concentrates to get a really nice heat
to it that kind of overrides the burn of the
alcohol and gives you more of that pepper lingering burned
to it.
Speaker 2 (12:10):
That's really interesting. So can you tell me a little
bit more about the moonshine background. Is this something that
we can create cocktails with?
Speaker 1 (12:17):
Oh?
Speaker 3 (12:17):
Absolutely.
Speaker 4 (12:19):
We use the word moonshine because it kind of gives
us that flexibility to do what we want with the spirits.
If you look into the labeling aspect and the TTP
and regulations, you know, there's very strict guidelines for what
can be called a vodka or a whiskey or a
bourbon and things like that. So we gravitated towards that
moonshine name because it really doesn't have those kind of
(12:39):
constraints in terms of what can be called that. So
I always think of my products as kind of a
mix between a liqueur and a flavored vodka, where they
might not be as harsh or quite as strong as
a vodka, but they're a bit stronger than a you know,
a cordiale or the core.
Speaker 3 (12:55):
So kind of that happy little middle ground.
Speaker 2 (12:57):
Wow, that's amazing. Do you guys have any plans like
what's next for you guys in terms of development of flavors?
Speaker 4 (13:05):
Yeah, so we're constantly trying to make new flavors and
things like that. We recently made one that's the smallest flavor,
and I think one of the next ones is going
to be either you know, coffee or pickle or something
like that to kind of catch on to some of
those flavor profiles. But we're constantly trying to develop new
flavors and utilize new techniques and all that kind of stuff.
Speaker 2 (13:25):
Wow, that's amazing. I can't wait to try them.
Speaker 3 (13:29):
Yes, we're excited. I mean, it's one of the things.
We started out.
Speaker 4 (13:32):
We had I think two flavors when we opened our
first for the first time, and now we've grown to,
like I said earlier, over twenty different flavors. So it's
definitely been a growth process and it's it's one of
the more exciting parts of my job is you know,
making those new flavors and figuring out the new things
that we can do.
Speaker 2 (13:48):
Amazing. So can you tell listeners where can they find
your products?
Speaker 3 (13:52):
Yeah?
Speaker 4 (13:52):
So we are located in Area, Pennsylvania on eighty six
fifty one Watsburg Road, which is just south of I ninety,
the main interstate that run if you're on from Boston
to Seattle. So yeah, unfortunately, I have to come to
us to get our products. Right now, hopefully In the
future we'll expand to the point where we.
Speaker 3 (14:08):
Can ship and get into some other places.
Speaker 4 (14:10):
Nationwide, but right now, our physical location is the place
to be well.
Speaker 2 (14:15):
Thank you so much Bernie for your information and being
on the Beverage Chronicle show.
Speaker 3 (14:21):
Yep, absolutely thank you for having me.
Speaker 2 (14:22):
Thank you so everyone you have heard him from Bernie
and also online and being there to visit to try
their products. Thank you so much for listening, and until
next time, cheers.
Speaker 1 (14:34):
That's all for this edition of Beverage Chronicles. I want
to thank you for joining me on this journey through
the world of drinks and the people who bring them
to life. If you enjoyed the day's show, be sure
to tune in next time for more stories, more flavors,
and more discoveries in every glass. Until then, I'm Gary
(14:56):
montroso thanks for listening and cheers.
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