In November 2021, Ball Corporation notified customers that it was changing the minimum order requirements for printed aluminum cans. Ball Corporation is one of the largest can manufacturers in the country. The increase from one truckload per SKU to five truckloads per SKU for non-contracted customers was scheduled to take effect on January 1, 2022. In addition, Ball announced that it would no longer warehouse inventory on behalf of customers and pointed most non-contract customers to a set of distributors for future orders.
This change of policy only impacts non-contracted customers and only involves printed cans. It did not directly impact all breweries, many of which are not contracted and/or purchase unprinted cans from Ball Corporation; however, industry observers recognized that this change is part of an overall tightening of the aluminum can supply chain for small, independent brewers.
Today (Jan. 4, 2022) we learned that at the behest of the Brewers Association and one U.S. Senator, Ball Corporation is delaying the change in policy. Senator Ron Wyden (D-OR) penned a letter to Ball asking that, among other things, it delay the implementation of the policy. Ball responded by announcing that it will delay the new policy until March 1, 2022. However, Ball added the caveat that it will not be able to provide customers with delivery date assurances. (You can read Senator Wyden’s letter here.)
According to the Brewers Association, aluminum cans currently make up around 60 percent of craft beer’s packaged volume. Away from beer, demand for aluminum cans continues to grow at an accelerated pace as large beverage brands switch from plastic bottles to aluminum cans. This puts the squeeze on the availability of aluminum cans for small brewers.
A statement on behalf of the Brewers Association said, “This news comes at a difficult time for the brewing industry which is already dealing with the ongoing effects of COVID-19 and supply chain issues. Many craft brewers pivoted to packaging their product to bring in much-needed income when their primary sales platforms disappeared (tasting rooms, bars, and restaurants) during the pandemic.”
Senator Wyden issued a statement on January 4 welcoming news of the postponement. In its response, Ball stated that it is open to further engaging with brewers on the distributor supply option to offer additional sources of aluminum beverage packaging. Some industry observers and insiders speculated that a driving factor in Ball Corporation’s change in policy was to bolster the middle tier, or distribution tier, of the aluminum can supply chain.
The statement from the Brewers Association concluded, “Though we know that this does not fully solve the supply chain issues, this is a positive step forward and opens the door to continued dialogue with Ball. The Brewers Association will continue to look for ways to work with our elected offices in an effort to help our members who have been impacted by this and other supply chain issues.”