Coffee Prices Surge Out Of Control Once Again As Brazil Threatened With 50% Tariffs – CoffeeTalk

Coffee futures surged on Thursday after US President Donald Trump threatened 50% tariffs on Brazil, the world’s largest producer of arabica coffee, causing a price surge for US consumers. Trump accused Brazil’s government of attacking free speech and orchestrating a “witch-hunt” against Brazil’s former rightwing president Jair Bolsonaro. Arabica coffee prices in New York climbed over 3.5% in response to Trump’s threat. Brazil is the world’s top producer of arabica coffee, used in higher-end brews. The letter is sending shockwaves across the coffee industry, as the US is Brazil’s main coffee buyer.

Giuseppe Lavazza, chair of Lavazza Group, said that tariffs between the US and coffee-producing countries such as Brazil and Vietnam would be more challenging for coffee companies and would push up prices for American consumers. The final outcome would be a rise in the cost of coffee in the US, making the US market more expensive for consumers.

Prices of arabica and robusta coffee have been strong over the past few years due to poor harvests in Brazil and Vietnam, reducing supplies and attracting speculators. London robusta futures reached a record high of nearly $5,700 a tonne earlier this year, while the price of higher-end arabica coffee beans rose 70% last year to $4.20 a pound.

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