By Anuradha Raghu, Nguyen Dieu Tu Uyen, and Maddie Parker
Coffee in the US risks getting even more expensive as President Donald Trump’s sweeping tariff measures hit Vietnam, one of its biggest suppliers, with hefty levies.
The Southeast Asian nation is the world’s leading producer of robusta coffee, the variety used in instant drinks and espressos. The 46% tariff on Vietnam’s goods — among the highest of the rates Trump imposed against US trading partners — threatens to disrupt flows and comes as coffee costs have already soared on the back of harvest shortfalls.
New York futures for arabica, the high-end variety used in coffee shops, have held near a record high after adverse weather hit key growing regions. Supply shortfalls also pushed robusta futures in London up more than 40% over the past year.
On Thursday, the most-active contract for robusta fell as much as 2.5%, while arabica futures dropped as much as 3.1%. Both contracts pared most of those losses by the market settle.
“The tariffs will likely add to coffee market volatility and could exacerbate existing supply tightness,” said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova Pte. in Singapore. “US coffee prices could rise, especially for robusta-based products.”
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