Tariff Tremors: The Steep Climb of Global Arabica Coffee Prices
The global arabica coffee market experienced a significant price surge in August due to a 50% tariff hike by the United States, disrupting Brazilian exports. Coffee prices on the ICE exchange have risen over 30%. Further challenges include reduced crop yields and frosts affecting future outputs.
In August, the global arabica coffee market saw a dramatic increase in prices, climbing more than 30% on the ICE exchange. This surge is largely attributed to a 50% tariff hike imposed by the United States, which has made it difficult for Brazilian coffee to compete in the American market.
Marcio Ferreira, president of Brazil's coffee exporters council, Cecafe, stated that the tariff has created uncertainty and led to unpredictable price hikes, adding that there appears to be no ceiling to the rising costs. The ongoing tariff pressures have disrupted the coffee trade.
Additionally, Brazil's crop performance poses further challenges. The nearly completed 2025 arabica crop collection fell short by approximately 10%, and the latest frosts are expected to impact next year's yields, complicating the market outlook further.
(With inputs from agencies.)
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