US Threatens Tariffs on Instant Coffee, American Consumers Could Bear the Brunt

The United States is proposing a new tariff specifically targeting instant coffee from Brazil, a move that industry leaders warn will ultimately hurt American businesses and consumers. The US Trade Representative (USTR) is considering a 25% tariff on Brazilian instant coffee as part of a Section 301 investigation.

Aguinaldo José de Lima, Executive Director of the Brazilian Instant Coffee Industry Association (Abics), stated during a USTR public hearing in Washington that the burden of the tariff would be passed directly to US consumers. “With the imposition of an additional tariff, the first impact will be felt by companies and jobs, and the higher costs will ultimately be passed on to the American consumer,” he said, as reported by Reuters on Wednesday.

De Lima highlighted that more than 90% of Brazil’s instant coffee exports are destined for the US market, accounting for over a fifth of total US instant coffee imports, or approximately 15,500 metric tons annually. He argued that the policy could significantly disrupt the supply chain, noting that the US relies on imports and there is currently no alternative supplier capable of matching Brazil’s volume at a comparable price.

The popularity of instant coffee in the US is on the rise. Data from the National Coffee Association shows that 11% of daily coffee drinkers in the US now consume instant coffee, up from 6% in 2021. De Lima questioned the logic of the proposed tariff, pointing out that all other coffee products, including flavoured instant coffee, are excluded from the measure. “There is no technical justification for treating instant coffee differently,” he added.

Alongside Abics, the Brazilian Coffee Exporters Association (Cecafe) and the US National Coffee Association (NCA) also voiced their objections during the hearing. They argued that the new tariff would increase prices for consumers, squeeze corporate profit margins, and disproportionately affect low-income households that depend on affordable coffee.