US coffee industry reeling as Trump slaps tariffs on major producing countries

Approximately 60% of coffee imported to the US comes from Brazil and Colombia | Photo credit: Mathias Reding

US consumers are facing further coffee price rises after the Trump administration imposed sweeping tariffs on the world’s largest coffee-producing countries.  
 

As of 5 April 2025, Brazil and Colombia, which supply the vast majority of arabica coffee served in US coffee shops, will be subject to a 10% baseline tariff. The move will add to the pressures facing coffee roasters amid record-high commodity prices and will likely lead to higher costs at coffee shops and retailers.  

World Coffee Portal research shows the average price of a 16oz latte at US coffee shops now exceeds $5, while some operators now charge more than $6 for a blended frappe of the same size. US operators, which until now have exercised caution on further price rises amid an increasingly value-focused trading environment, will now be left with little option but to increase prices. 

In 2024, approximately 60% of the 1.36 million tonnes of coffee imported to the US came from Brazil and Colombia, according to the US Department of Agriculture, with higher quality arabica historically accounting for more than 90% of US coffee imports.  
US coffee consumers will also find little respite on supermarket shelves after US President Donald Trump imposed a 46% tariff on imports from Vietnam – the world’s largest producer of robusta coffee widely used in instant, single-serve and ready-to-drink (RTD) coffee products.  

The levy could add an additional $2,500 per ton of Vietnamese coffee for a US buyer, according to a Reuters source. Indonesia, another key robusta producer and fourth largest coffee producing country globally, is facing a reciprocal trade levy of 32%. 

Switzerland is also facing a 32% tariff, which could compel Nestlé to product prices in the US, despite CEO Laurent Freixe asserting in February 2025 that the company was “immune” to tariffs due to its decentralised manufacturing footprint. 

Currently, Nestlé’s coffee pod division Nespresso roasts, grinds and encapsulates its coffee pods in Switzerland before shipping to the US – its largest market outside of Europe. 

Higher green coffee prices could also prove a headache for major coffee brands seeking growth in the US, including Lavazza, which recently expanded its partnership with coffee capsule manufacturer, Keurig Dr Pepper. The Italian coffee roaster currently ships around half of its US inventory from Italy, with the remainder manufactured at its Pennsylvania roasting facility. 

“Our goal remains to grow in the US because it has an immense market size compared to the rest of the world,” Lavazza Group CEO Antonio Baravalle said. 

Fellow Italian coffee roaster illycaffè is also considering increasing direct production in the US, where approximately 20% of its global revenues are generated. “We are scouting to understand if part of what we sell can be produced there,” CEO Cristina Scocchia told Italian news agency Ansa following the release of illycaffè’s annual results.  

Scocchia also warned that tariffs would lead to price rises. “Duties will be passed on to the final price. We, as I guess other players will be, are evaluating what percentage,” she told Reuters. 

European Commission President Ursula von der Leyen has indicated the EU, which faces a 20% levy, will respond with countermeasures if trade negotiations with the US fail. Meanwhile, Vietnam’s Department of Foreign Market Development has requested a temporary suspension of the tariffs pending further discussions. 

Trump says the tariffs will seek to reduce alleged international trade deficits, boost the US economy and increase purchases of domestically made goods. However, just 0.2% of the coffee consumed in the US is grown domestically by producers in Hawaii and California.