US coffee drinkers face higher prices even after Trump's tariff reset

LONDON, Dec 19 (Reuters): US coffee lovers hoping President Donald Trump's tariff rollbacks last month will soon lower the cost of their daily caffeine hit had better think again.
The widespread import tariffs imposed by Trump mostly over the summer, which included top coffee producers such as Brazil, boosted the price of raw coffee beans. But the added costs are mostly still filtering through supply chains and have yet to reach consumers, according to brokers, traders and industry experts.
High US retail coffee prices have, in other words, been driven mostly by last year's coffee bean supply shortages, which spurred a doubling in raw bean prices in the 12 months to March.
"Most of the (retail) price increases we've seen so far are not in response to tariffs. (They're) associated with the record high (raw bean) market that we've been in since last year," said independent coffee analyst Christopher Feran.
Feran and other industry experts estimate it takes at least nine months for raw bean prices to filter through to coffee drinkers, partly due to roasting times and price negotiations, meaning it could be well into next year before prices retreat.
Coffee drinkers in the US, the world's biggest coffee consumer, will have to swallow higher prices for longer. And the White House will have a tricky job trying to cool food inflation before the US 2026 November midterms.
Trump, under pressure from Democratic wins in New Jersey, New York and Virginia linked to voter frustration over rising food prices, last month rolled back "reciprocal" tariffs of between 10-41 per cent on over 200 food items that cannot easily be grown in America, such as coffee.
He also exempted non-native food items from an additional 40 per cent tariff on imports from Brazil, which supplies the US with around a third of its beans.
Raw bean prices account for at least 40 per cent of the cost of producing a bag of roast and ground coffee. They rose sharply last year as the market was unable to bounce back from three seasons of production deficit linked to adverse weather.
Most industry experts expect a coffee production surplus in the current and upcoming 2025/26 and 2026/27 October to September seasons which should, alongside the tariff removal, soften raw bean prices and eventually feed through to US consumers.
Line chart showing arabica coffee prices from Q1 2024 to Q4 2026. Prices rise sharply through 2024, peak in early 2025, then forecast to fall about a third by late 2026 as production surplus eases pricing pressure
Line chart showing arabica coffee prices from Q1 2024 to Q4 2026. Prices rise sharply through 2024, peak in early 2025, then forecast to fall about a third by late 2026 as production surplus eases pricing pressure
But this will take time, analysts say, because US roasters typically hold about two to three months' worth of bean stocks on average and need another two to three months to roast and package their products.
They also tend to negotiate prices with retailers only on a quarterly basis.
In other words, very little of the 18.8 per cent rise in US retail coffee prices in the year to November is due to tariffs.