This is a complex and ever-changing topic, but it's something we, and every other coffee business in the U.S., have had to navigate. This past year brought new challenges to us as coffee roasters, and we want to offer a look at the underlying reasons behind the cost of coffee.
By now, consumers have undeniably felt the significant increase in the price of their daily cup of coffee. The average price of a pound of coffee in America has increased by over 40% in the last year. Whether you brew at home, visit your local cafe, or hit the Starbucks drive-thru, the impact of these higher costs is clear.
What remains less transparent is the reasoning behind these increases, and if there is any sign of relief in the near future. Several factors have contributed to this. Poor weather patterns, tariffs, and market volatility have all played a role in contributing to the increase. In 2024, droughts in Brazil and Vietnam led to a significantly lower crop yield. Brazil typically accounts for over 30% of the U.S. coffee market, and Vietnam for about 6.5%. With this demand, but a much lower supply, the price of futures surged to record highs as a result.
On top of this, earlier this year, President Trump introduced tariffs on imported goods. So who pays these tariffs? The U.S. importer must pay the tariff before the shipment can be released from the port. The tariff becomes a part of the cost of coffee, not a markup, but a cost that is passed on to the roaster and then to the final coffee buyer.
The tariff percentages vary from country to country. Some sit at 10% like Colombia and Ethiopia, with tariffs as high as 50% on Brazilian imports. This has been a large factor in the surge of coffee prices since April 2025.
So are there any signs of relief coming? Maybe. But it's complicated. This past Friday, President Trump announced that certain agricultural goods, including coffee, would be exempt from tariffs to help ease the cost to consumers. This comes as a result of coffee being “an unavailable natural resource” in the United States (Other than Hawaii and Puerto Rico, which make up less than 1% of the market).
This is good news for U.S. coffee businesses and consumers. But there is still a large hangup, which is that Brazil was excluded from these exemptions. The tariffs on Brazilian coffee were reduced from 50% to 40%. With Brazil being the largest producer of coffee for the U.S. market, the costs of coffee will not significantly come down without a deal being made there.
We are hopeful for the future. The exemptions that have taken place will provide partial relief, but the effects of this reduction will take some time to materialize, as the majority of coffee that will be sold in the next several months has already been subject to tariffs. We will continue to be diligent in sourcing, always keeping in mind the price for the consumer, but never compromising on our commitment to quality.
We are continually grateful for our amazing customers and wholesale partners, importers, and producer partners who stick with us as things change. The business of coffee will never be without its challenges, but your support ensures that we can continue to be a part of the line of people who work to produce the world's favorite drink.
