The Coffee Industry Was In Denial About Trump's Tariffs Until They Started Disrupting Imports – CoffeeTalk

TJ Semanchin, co-owner of Wonderstate Coffee, a Wisconsin-based coffee roaster, has been in the coffee business for 25 years and is currently facing challenges due to Donald Trump’s 10% blanket tariffs. The company, which typically imports 40,000 pounds of coffee in one transaction, is in a business climate where there is uncertainty and volatility.

The coffee industry has been dealing with historically high commodity prices for the last six months, with Brazil and Vietnam being hit by climate disruptions. This has affected everyone, from roasters like Wonderstate to large brands like Maxwell Houses and Starbucks. A supply crunch has pushed prices up due to it being harder for farmers to grow the beans.

Wonderstate Coffee is dealing with coffee from Ethiopia, Guatemala, and Peru, which are the biggest African sources. If the tariff is set at 10%, the tariff would be $20,000. The company buys about 14 containers a year, so they are looking at $250,000 to $300,000 of tariff impact. This means borrowing more money, which comes with interest but also tying up cash.

Tariffs are making Semanchin more conservative in their outlook this year, as they can’t afford to invest in people, equipment, or growth. They are pulling back on plans they had for this year. They are working with the two sides of the coffee world: empowering farmers while providing consumers with some of the best coffees.

As prices increase, customers may stop drinking coffee or go somewhere else. The business environment is dicey, and the price of bags that they put their coffee in is uncertain. Many of these bags come from Asia, and tariffs are bouncing all over the place, including China and Taiwan.

Semanchin has spoken to elected officials and a senator from his state, trying to make waves in Washington, DC, as this is clearly going to slow their job growth.

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