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For a brewer in steel country, mixed feelings on tariffs’ potential impact

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GARY, Ind. — For more than four decades, Indiana has been the top steel producing state in the country, cranking out more than 27 percent of the nation’s steel. Northwest Indiana is synonymous with the steel mills like the U.S. Steel Gary Works plant.

In a move designed to strengthen American steelmakers, President Trump ordered tariffs put on imported steel and aluminum Thursday, going against loud objections from leaders in his own party, from overseas and from other American businesses. You can imagine how popular the tariffs are in Indiana, but outside of the steel industry, the new tariffs could pose problems in unexpected places.

The 18th Street Brewery is housed in a red brick building in Hammond, IN, but but behind the red brick is a wall of aluminium. Brewery Founder and President Drew Fox says he buys about one million aluminum cans every year to package his beer. Another major cost for Fox is the one or two stainless steel fermenters he buys every year.

“Hopefully the president will see that it will affect our business and many other businesses that use stainless steel and aluminum," Fox said.

President Trump signed an order following through on his threat to impose stiff penalties on imported steel, while exempting Mexico and Canada. But they could have consequences for several nations and American industries that use cheap steel from overseas, impacting everything from  autos to appliances.

“No one wants a trade war, no one wants to see another recession, no one wants to see job losses, so finding that balance between those things has to make sense,” Fox said. "I’m not an economist, but I know basic math and that could have a ripple effect on what we’re doing when it comes to employment, expanding, growing."

But American steel companies are applauding the move, saying it will once again make the U.S. competitive in the steel industry. Last week, the CEO of Zekelman Industries, a Chicago-based steelmaker with more than 2,000 employees, promised each worker an annual $1,000 bonus if the tariffs are imposed.

“This is a great opportunity for us to experience growth, an opportunity for the company, which our owner Barry Zekelman has been gracious enough to share with all of his employees across all the facilities,” said VP Zekelman's Vice President Tony Frabotta,.

For a brewery that employs 40 people in the heart if steel country, it’s all about finding the right mix of policy and prices.

“Obviously we want to support our U.S. steelmakers. Obviously we’re in Indiana, we have two steel plants. It’s a concern because we don’t to see those prices skyrocket,” Fox said.

President Trump has the authority to do this without congressional approval, but some Republican heavyweights in Congress are threatening to attempt to nullify the tariffs, with Arizona Republican Jeff Flake saying he was drafting legislation immediately to do so.