Coffee Prices Set to Spike After Brazil Tariff Shake-Up
If you’re a coffee-lover waiting for prices to drop back down after poor harvests and spiking prices, you might be waiting a while. With the U.S. levying a 50% tariff on Brazil, coffee prices could go up even more, making what used to be a staple grocery item unaffordable. The United States imported 1.6 million metric tons of unroasted and roasted coffee in 2024, according to the Agriculture Department, and it remains to be seen what will happen to producers overseas when the tariffs take effect. “We’re going to see a reshape in the coffee flow in the world,” Guilherme Morya, a coffee analyst for Rabobank based in São Paulo, told The New York Times. “Especially Brazil to other regions.”
While there is a domestic coffee industry based in Hawaii, it could not replace the coffee imported from South America. “We can’t grow enough coffee,” said Shawn Steiman, the owner of Coffea Consulting in Honolulu. “The Hawaiian coffee market isn’t tied to the global industry.”
Brazil is the world’s top coffee producer and provides 30% of the coffee imported into the U.S. “It will harm us, coffee exporters, in terms of jobs, income and costs. And it will hurt the American industry and the end consumer, who will end up paying more,” Marcos Matos, executive director of Cecafé, Brazil’s coffee exporters council, told The Associated Press.
RELATED: 11 Costco Kirkland Products That Shoppers Call the Store’s Best-Kept Secrets
Brazil managed to avoid the harshest tariffs when President Trump first announced them in April. “We had been left out, so many people were saying that Brazil would end up benefiting from this,” Marcos Jank, a professor of global agribusiness at Insper, a business school in São Paulo, told AP. “But with this 50% tariff hike, we now face one of the highest tariffs the U.S. is applying. We moved into a losing position.”
According to the Financial Times, arabica coffee prices jumped by 3.5% the day after President Trump’s announcement. The situation is more complicated because many European countries import Brazilian coffee beans and export their own products to the U.S. “The problem is not to have tariffs between America and Europe. The problem is to have tariffs between US and Brazil, US and Vietnam, US and all the countries where coffee is produced,” said Giuseppe Lavazza, chair of Lavazza Group. “The final outcome will be a rise in the cost of coffee in the US. So the US market becomes more expensive for consumers.”
Customers are already expressing alarm about possible price hikes on social media, with coffee-lovers sharing tips for the cheapest brew. “It’s crazy how bad it’s getting. $30 for a lb of local roast. $10 for 9 oz of folgers, nearly $20 for 16. I love coffee. I don’t know what I’m gonna do,” one Redditor said. “Costco online is the way to go. They had their Kirkland brand medium roast Mexican earlier this year for $18/2 lb bag, but I’ve also liked ruta Maya and parisi. Both are less than $10/lb when you get a 5 lb bag,” another recommended.
