The prices and the coffee crisis in the U.S. set a new record in September, with a staggering 41% increase compared to the same month in 2024, caused by the impact of widespread tariffs and extreme weather conditions threatening production, according to the Consumer Price Index, which measures the price of all coffee products, including instant coffee.
For last month, the average price of a pound of ground coffee in the United States reached $9.14, a 3% increase compared to August’s average of $8.87, confirming a sustained rise since the beginning of the year, according to U.S. government figures released.
“Consumer prices for food purchased for home consumption and dining out rose 3% in September compared to the same month last year,” reported the U.S. Department of Labor (DOL). The report notes that coffee prices have increased by 19% since September 2024 and remained unchanged compared to August.
Rising Prices at Coffee Shops
Nikki Bravo, co-owner of Momentum Coffee in Chicago, raised prices by approximately 15% last week for her line of lattes, cappuccinos, and other beverages across her four locations.
The owner explained that she is paying 15% more for imported coffee beans compared to last year and has started roasting more beans in-house to save money. Most of her beans come from Africa.
Additionally, she noted that other items have also become more expensive, such as cups and sleeves, while the minimum wage in Chicago increased to $16.60 per hour on July 1.
“At some point, we had to pass on the cost increases; we couldn’t keep absorbing them,” Bravo said.
“Persistent high inflation has also created uncertainty among consumers and made them less willing to spend on takeout coffee,” she added. According to Toast, a restaurant management system, the average price of a coffee in U.S. restaurants in September was $3.54, up from $3.45 the previous year.
The problem is compounded in a country where residents love a cup of coffee but can only grow it in small areas of Hawaii and Puerto Rico. As a result, 99% of U.S. coffee is imported, according to the National Coffee Association, a trade group.
Tariffs Shaking Up Trade with Brazil
Brazil is the top supplier of U.S. coffee, providing 30% of the market. This did not stop Donald Trump from imposing a combined 50% tariff on its exports to the United States due to political differences with the government of Luiz Inacio Lula da Silva.
Due to the high costs, Brazilian producers have begun holding back shipments to the U.S. while negotiating with American roasters on how to fairly absorb the additional cost. As a result, supply in the country has decreased, according to investment bank UBS.
In the case of Colombia, the second-largest coffee exporter to the U.S., with 20% of the market, it faces a 10% tariff, but due to political differences with South American President Gustavo Petro, President Trump threatened to increase tariffs and suspend U.S. aid to Colombia.
Meanwhile, Vietnam, the third-largest exporter, supplying 8% of the U.S. coffee market, has had a 20% tariff since this summer.
Due to the high costs of these restrictive measures, Trump announced in September that “unavailable natural resources” could be exempt from tariffs for countries that have reached trade agreements with the U.S. So far, coffee has not been included.
The Impact of Climate Change on Coffee Production
If that were not enough, factors such as heat, drought, and other adverse weather conditions have affected global coffee production in recent years, causing sudden spikes in global coffee prices—nearly 40% in 2024, according to the United Nations Food and Agriculture Organization (FAO).
Additionally, earlier this month, coffee prices rose after the National Oceanic and Atmospheric Administration (NOAA) reported the possibility of adverse weather conditions like La Niña, which could trigger a drought in Brazil.
Given the increasing climate risks to coffee production, some researchers are attempting to develop more climate-resistant coffee varieties.
In the U.S., a bipartisan group of lawmakers introduced a bill to repeal all coffee tariffs:
“We only produce 1% of the coffee consumed by Americans. It’s one of the best examples of the economic nonsensical nature of Trump’s widespread tariffs,” explained Ro Khanna, a Democrat from California, who co-sponsored the bill with U.S. Representative Don Bacon, a Republican from Nebraska.
Bacon said Friday that he became interested in the issue after seeing how much coffee cost at the grocery store. He added that he dislikes tariffs and believes Congress, not the president, has the authority to impose them.
Bacon acknowledged that the Trump administration is realizing that imposing tariffs on products the U.S. cannot grow is bad for consumers. For this reason, he hopes the bill will move forward in Congress.
“I hope the president and Congress see the positive benefit of eliminating this tariff for the average American,” he stated.
Image: DiarioNY
