Tariffs are coming hard for your morning caffeine fix

Coffee prices have recently surged to an all-time high, hitting $7.93 per pound of ground roast coffee in May — up from $5.99 at the same time last year, according to Bureau of Labor Statistics data.

Now, as the Trump administration prepares to impose a 50% tariff on imports from Brazil to the US from August 1, people may have to fork out even more.

The tariffs could see the world’s biggest coffee grower halt new shipments to the world’s biggest coffee drinker altogether if enacted.

Per Reuters, the US imported more than 8.1 million 60-kilogram bags of the product — one-third of its total consumption — from Brazil last year.

With coffee supplies already tightening as droughts have squeezed harvests, wholesale costs could rise as much as 50% if these tariffs take effect, which could translate to a price hike of $0.25 a cup.

The Takeaway

It’s worth noting that coffee drinkers have had it pretty good for years. Adjusted for inflation, the price of coffee hasn’t gone up that much relative to other stuff. Had coffee tracked the wider rate of inflation over the last 45 years, the $3.21 per pound that we paid back in 1980 would actually be closer to $13 per pound today.

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