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After months of pressure from industry bodies and lawmakers, the Trump administration announced that it would amend its stance on tariffs on certain products, including coffee.
President Trump issued an executive order on Friday that would exempt certain commodities “that are not grown or produced in sufficient quantities in the United States” from reciprocal tariffs.
However, as Elisabeth Buchwald reports for CNN, this does not remove all tariffs from coffee.
This story can be tricky to follow because multiple bills and executive orders are being issued simultaneously. For example, on Thursday, the administration announced that coffee and bananas from four Latin American countries—Argentina, Guatemala, El Salvador, and Ecuador—would be exempt from tariffs. The exemptions are part of trade deals with the countries, which Axios notes account for about 7% of U.S. coffee imports.
The Trump administration has been suggesting a possible tariff exemption for coffee for months. In August, Commerce Secretary Howard Lutnick told CNBC that President Trump “has agreed to set zero tariffs for those natural resources that are not grown in the U.S. in the trade deals he has closed.” In September, the White House issued a new executive order exempting certain products from tariffs if exporting countries agree to new trade deals.
Last week, Trump once again hinted at a tariff exemption for coffee during an interview with Fox News’ Laura Ingraham on Nov. 11. “Coffee, we’re going to lower some tariffs,” Trump said. “We’re going to have some coffee come in. We’re going to take care of all this stuff very quickly, very easily.”
Throughout all this uncertainty, the coffee C price has been all over the place, reaching record highs over the last few months. It fell after Trump’s comments last week, and again after the exemptions announcement on Friday.
Much of the reporting around the tariff news focused on Trump’s wish to lower food prices (despite his tariffs being a major reason for the rise). However, as Allison Morrow reported for CNN, coffee shops are unlikely to lower costs or change menu prices any time soon. “It’s a principle that applies to most businesses, that once you take price increases, you tend not to give them back,” Cornell professor Alex Susskind told Morrow.
Customers may see some relief when it comes to retail bags. Grocery store coffee prices rose 21% in August compared to the same month last year. Morrow writes that prices may go down “among mass-market coffee producers whose customers are more sensitive to price movements.”
Read the latest tariff twists and turns fron CNN here.
Photo by Drew Gilliam on Unsplash
