USA: Beverage market is running dry on cans

While the coronavirus pandemic is hurting beer sales in pubs and bars, the sale of beer in cans is going through the roof. Several breweries in the U.S. are now facing the problem of supplying their customers with enough cans.

Brands that already face a shortage include Coors Light as well as Corona, Modelo, Dos Equis, and White Claw. Market observers, however, fear that things get worse and some brands might be soon totally out of stock.

"Can supply is a big deal," says Paul Gatza, senior vice president for the Brewers Association. "We are seeing extended wait times for can orders and also some of the smaller players not having orders fulfilled." Bigger beverage producers are forced to prioritize some of their brands over others. "Everyone who makes anything that goes into a 12-ounce can is being challenged to some respect," Adam Collins, Chief Communications and Corporate Affairs Officer at Molson Coors told CNN Business.

The problem arises as customers stay at home and part of their consumption is switched from restaurants, pubs and bars to home consumption. At the beginning of the pandemic when lockdowns started the consumers even stocked up on cans of beer and other beverages. In addition, the rising popularity of hard seltzers which are sold predominantly in cans is aggravating the situation.

The unusual high demand for cans in the United States has forced can makers to import cans from Mexico, Canada and overseas. However, since this is not a long-term solution, they are planning new production lines and plants. Ball Corporation, the largest can manufacturer in the United States, has worked to boost efficiency at its 16 U.S. plants and is constructing two new facilities — one in Glendale, Arizona, and one in a not-yet-named location in the Northeast.

Crown Holdings (CCK) formerly Crown Cork & Seal Company, located in Yardley, Pennsylvania, announced at the end of February shortly before the pandemic started in the United Sates to build a new beverage can manufacturing facility in Bowling Green, Kentucky. It is expected to begin operations in the second quarter of 2021 and to create 126 new jobs.

"Beverage can growth in North America is being driven by the growing proportion of new products being introduced in cans versus other packaging, as both customers and consumers recognize the inherent portability, durability and sustainability of the beverage can," said Timothy J. Donahue, President and Chief Executive Officer of CCK at that time.

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