'A clear and present danger': Wisconsin manufacturers brace for higher costs from Trump administration's 25% steel tariffs

MILWAUKEE (CBS 58) -- Twenty-five percent tariffs are now in effect on all steel and aluminum imports into the United States after President trump imposed them Monday evening.

But economists and industry insiders believe that move will trigger a chain reaction that will hurt US manufacturers.

The concern now is with little competition coming from overseas, US steel and aluminum producers will raise their prices.

That means higher prices for manufacturers, which they say is bad for the country and bad for Wisconsin.

Russ Klisch, the president of Lakefront Brewery, told us, "It does feel like it's going to be a bigger issue, or could be, there's no question."

The impact of the steel and aluminum tariffs was already being felt Monday in Milwaukee.

Klisch said they canned more than 10 million cans of beer last year.

Their supplier uses US aluminum, and if prices go up, Klisch could be paying a lot more on his next contract.

President Trump imposed the tariffs Monday from the Oval Office, saying, "It's 25% without exceptions or exemptions and that's all countries no matter where it comes from."

But for companies here at home, the sale of their products in Milwaukee is not the only thing that could be impacted. International sales could also be affected by recent developments.

There are now fears of a trade war as Canada threatens retaliatory tariffs against the United States.

Mary Ng, the Canadian Trade Minister, said, "We would consider all of the options that are available to Canada."

Four percent of Lakefront Brewery's sales are to Canada.

Just Monday, Klisch was on the phone with Canadian buyers. He said, "They were scared or concerned the Canadian dollar was going to tank."

The uncertain economics forced Klisch to hold off on canning his next Canadian shipment. "I wasn't quite sure if they were buying it so we put the run off a week."

And those who rely on steel say that's bad for US manufacturers.

Kip Eideberg is the senior vice president of government & industry relations at the Association of Equipment Manufacturers. He told us, "Tariffs on steel and aluminum are a clear and present danger to equipment manufacturers in Wisconsin."

Eideberg said about 94% of the steel used in US equipment manufacturing is produced in the United States. But with steep tariffs on international competitors, he worries US producers will raise their prices.

Eideberg said, "Even if they're in effect for a week, two weeks, a month, it's still an impact, no doubt, on our industry."

He said the last time Trump imposed steel tariffs in 2017, it drove up the cost of making equipment by 7%-8%.

Now he fears it will keep manufacturers from hiring and expanding. "These are jobs, manufacturing jobs, that will not come back. When they're gone, they're gone forever."

There are several manufacturing industry leaders in Milwaukee like Komatsu and Milwaukee Tool.

But Eideberg said smaller manufacturers will be hit the hardest. He said the last time the tariffs were implemented, it led to layoffs.