Beer Institute Applauds Senate Legislation Allowing More Oversight, Investigation into Aluminum Markets
WASHINGTON, D.C. – Jim McGreevy, President and CEO of the Beer Institute, released the following statement on Sens. Cory Gardner (R-CO) and Tammy Baldwin (D-WI) introducing the Aluminum Pricing Examination (APEX) Act (S. 1953), bipartisan legislation that would enhance the Commodity Futures Trading Commission (CFTC) and Department of Justice’s (DOJ) authorities over aluminum premium benchmarking entities, including those that publish the Midwest Premium:
“I applaud Senators Gardner and Baldwin for working across the aisle to ensure aluminum premium benchmarking is fair and transparent for American brewers. More than 63 percent of beer manufactured and sold in the United States is packaged in aluminum, and the beer industry supports more than 2.1 million American jobs. Aluminum premium benchmarking should reflect market fundamentals, and this commonsense legislation would bring transparency to aluminum pricing and restore manufacturers’ confidence in the system.”
Created by metal producers years ago, the intent of the Midwest Premium was to reflect the cost of attracting aluminum into North America. At times, however, the Midwest Premium has moved erratically. In 2018, the Midwest Premium more than doubled following the introduction of tariffs on imported aluminum, leading to dramatic cost increases for beer and beverage aluminum containers.
In 2018, the beer industry purchased 36 billion aluminum cans and aluminum bottles – if stacked end-to-end those cans would reach to the moon and back 12 times. Aluminum used in cans is the single most substantial cost in American beverage and beer manufacturing.
Under current law, no federal agency has direct oversight authority over the aluminum benchmarking system. The APEX Act addresses this problem by providing much-needed oversight authority over aluminum premium benchmarking entities. Specifically, the APEX Act would grant the CFTC enhanced statutory authority to oversee and investigate premium setting and reporting entities in the aluminum market, provide the DOJ the ability to consult with the CFTC to ensure all oversight and regulatory actions are in accordance with antitrust statutes, and it would afford the U.S Attorney General the opportunity to comment formally on any proposed CFTC regulatory action or guideline.
Representatives Al Lawson (D-FL) and Ken Buck (R-CO) introduced a House companion earlier this year, H.R. 1406.
The Beer Institute is a national trade association for the American brewing industry, representing brewers of all sizes, as well as beer importers and industry suppliers. First founded in 1862 as the U.S. Brewers Association, the Beer Institute is committed today to the development of sound public policy and to the values of civic duty and personal responsibility. For additional updates from the Beer Institute, visit our website, follow @BeerInstitute on Twitter, like the Beer Institute on Facebook, and follow the Beer Institute on Instagram.