Import tax on coffee pressures US roasters already facing high prices

Reuters

03-04-2025

NEW YORK, April 3 (Reuters) - The first U.S. tariffs on coffee imports since colonial times will increase costs and complexity to importers and roasters already dealing with near-record prices.
The U.S. announced on Wednesday tariffs of 46% on imports from Vietnam, the world's second largest coffee producer, as well as a 32% duty on imports from Indonesia, the fourth largest grower. Central and South American coffee growers, such as Brazil and Colombia, got a 10% tariff.
Vietnam is the third largest supplier of coffee to the U.S., the world's largest consumer of the beverage. It mainly exports robusta coffee, a type widely used to make instant coffee as well as ready-to-drink cold beverages.
"Vietnam is the big one that sticks out," said Tomas Araujo, a broker at StoneX. "Going forward, it will be a challenge for the supply chain and to end users, with added costs," he said.
"This is big. The tariff on Vietnam means $2,500 more per ton" for a U.S. buyer, a European trader said. ICE robusta futures , the global price benchmark, were trading at around $5,390 per ton on Thursday.
It is uncertain if beans already en route to the U.S. are subject to the large tariff, he noted.
Countries exporting cocoa, the main chocolate-making ingredient, were also taxed. No. 1 grower Ivory Coast got a 21% tariff.
"Both the coffee industry and candy manufacturers will lobby hard to have the tariffs removed from these products," said soft commodities analyst Judith Ganes, president of J Ganes Consulting. "I personally doubt the tariffs will stick."
U.S. roasters will probably have to shift from Vietnam's robustas to Brazil's, known as conilons, experts said. But Brazil does not have a lot of robustas, as it produces mostly the milder arabica variety.
The U.S. will have to compete for the conilons with the local Brazilian industry, they said, while Europe and China might be better off having a larger supply from Vietnam at lower prices.