Tariffs Drive Global Coffee Prices 30% Higher

The sharp price increase, which is being passed down to consumers by retail coffee chains such as %Starbucks (NASDAQ: $SBUX), comes as the U.S. has placed a 50% tariff on Brazilian coffee.

The Brazilian government says the Trump administration's tariff has made exports to the U.S. unviable and disrupted the global trade in coffee beans.

Arabica coffee futures traded in New York are currently at $3.74 U.S. per pound, up from about $2.80 U.S. at the end of July this year. Analysts see more price increases ahead.

Adding to the price rise is the status of the coffee bean crop in Brazil, the world's largest producer and exporter of coffee products.

The 2025 arabica coffee bean crop, which is approaching harvest, has yielded about 10% less than expected this year due to poor growing conditions.

Due to the situation in Brazil, importers are turning to other regions that grow coffee such as Central America and Colombia.

However, Brazilian coffee does continue to see strong demand in Europe and parts of Asia, which is helping to continue driving sales.

Companies such as Starbucks, and others, have warned that prices at retail coffee shops are likely to increase further in coming months due to the evolving tariff situation in the U.S.

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