Coffee crunch: New tariffs brew trouble for American cafés
Although Donald Trump suspended tariffs on specific countries for 90 days, a new general 10% tariff took effect on 5 April. The impact is already noticeable, with Americans now paying more for coffee.
Cafés in the USA are increasing coffee prices, as reported by American and British media, including Business Insider, CBS, and the BBC. As of 5 April, a new 10% general tariff on imports to the USA is in effect. While Donald Trump exempted some products from tariffs, such as phones and laptops, this exemption does not apply to coffee. According to calculations by Business Insider and the BBC, the United States is the second-largest importer of coffee in the world. They primarily import beans from Brazil and Vietnam, but also from Colombia, Ethiopia, and Guatemala, among others.
Chris Kornman from Royal Coffee, a company importing coffee to the USA, reports to Business Insider that suppliers have already increased prices. If his company didn't follow suit, their business model wouldn't be sustainable. He comments that the coffee industry is experiencing an "unprecedented crisis." The Crown café in Oakland, California, owned by this company, has already raised coffee prices by 35 pence, except for one basic menu item.
For example, The Wakery café in Springfield, Illinois, has also increased prices. A 20% rise occurred at the Au Lait café in Washington, according to the BBC. The manager admits that there are now fewer customers. Reports of this type are coming in from all over the country.
Further increases possible
Some owners also point out that if Donald Trump does not reach an agreement with other countries in three months and country-specific tariffs resume, prices could rise again. Even without the imposition of new tariffs, prices in cafés were already on the rise due to general inflation.
Let’s recall that on 2 April, President Donald Trump announced a package of new tariffs on most trading partners, with different rates for different countries. Additionally, he introduced a general 10% rate. This 10% rate came into effect on 5 April, while the differentiated rates for specific countries began on 9 April. On the same day, Trump announced he was suspending their enforcement for 90 days. During this time, he plans to have discussions with his trading partners and negotiate new trade exchange rules.
“People were getting a little queasy,” said US President Donald Trump on Wednesday, explaining the decision to suspend tariffs. Trump said he was observing the financial markets, which had recently been "glum".
Donald Trump attributed the 90-day suspension of tariffs to what he described as minor concerns raised by the public. The true reason was the "bordering on panic" concern of the White House over the bond market, commented NBC News on Wednesday. According to "The Economist," bonds have become the most significant opponent of the US President.
