The North American coffee industry is bracing for disruptions as the U.S.-led trade war threatens cross-border supply chains integral to roasting, packaging, and distribution. Companies like Starbucks, which roasts coffee for its Canadian stores in the U.S., are re-evaluating operations amid potential tariffs. While the U.S. postponed 25% levies on most Canadian and Mexican goods, coffee remains vulnerable due to its omission from the USMCA trade pact.
To mitigate risks, traders are inserting clauses requiring buyers to absorb tariff costs. Jeff Bernstein of Canada’s RGC noted clients, including a Mexican exporter shipping to California, have accepted such terms. Meanwhile, Nestlé’s robusta coffee investments in Mexico highlight the region’s strategic role in global supply chains.
Industry leaders, including the U.S. National Coffee Association, argue tariffs would harm consumers and businesses, as coffee cannot be grown domestically. Concerns also linger over possible U.S. tariffs on South American producers like Brazil, the world’s top coffee exporter, following recent U.S.-Brazil trade talks.