Tariff Threats Destabilize Coffee Prices – CoffeeTalk

Arabica coffee prices have reached a record level as traders digest the withdrawal of President Trump’s threats to impose tariffs and economic sanctions on Colombia. Continuous arabica coffee futures on the ICE rose 0.8% to $3.50 a pound in midday trading in Europe, exceeding the prior record of $3.48 set in early December. The U.S. imports about 30% of its coffee from Colombia, along with other food staples such as bananas, avocados, and gold. Overall, the U.S. imported $16.1 billion in goods from Colombia in 2023, according to Census Bureau data.

Trump had issued threats to impose 25% tariffs and sanctions on Colombia in retaliation for the Colombian government refusing to allow two military planes with migrants to land. However, the White House later stated that Colombia had agreed to all of Trump’s terms, including to repatriate migrants into the country. The tariff actions directed toward Colombia provide important context to commodities markets amid looming threats of boosted tariffs on Canada, Mexico, and China as soon as Feb. 1, JPM said.

Potential tariffs on imports from these countries could be much more impactful to both complex-wide pricing and U.S. price differentials more specifically.

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