Shipments to Latin America surge as U.S. demand drops
Brazilian coffee exports to the United States dropped 46% in August following the implementation of new U.S. tariffs, according to Cecafe, Brazil’s coffee exporters council. The 50% levy imposed on Brazilian goods, including coffee, has dramatically reshaped global trade flows, with Latin American neighbors like Mexico and Colombia increasing their imports.
Germany overtook the U.S. as the top destination for Brazilian coffee in August, receiving 414,109 60-kilogram bags. Meanwhile, exports to Mexico rose by 90% to 251,166 bags, and shipments to Colombia soared 578% to 112,948 bags. In contrast, U.S. imports fell from 562,723 bags in August last year to just 301,099 this year.
Tariffs disrupt markets and impact instant coffee sector
Cecafe President Marcio Ferreira stated the tariffs “disrupted the market and opened the door to speculative movements.” He also dismissed the idea of rerouting raw coffee beans through third countries to bypass tariffs, citing the high risk of detection by U.S. authorities.
Brazil’s instant coffee industry has been particularly hard-hit. Aguinaldo Lima, executive director at ABICS, revealed that exports of instant coffee to the U.S. fell nearly 60% in August, totaling 24,460 bags compared to 65,914 in the same period last year. “This is detrimental not only to our industries, but also to our trading partners in the United States,” Lima emphasized.
Domestic inflation pressure rising in Brazil
The effects of the tariffs are also being felt within Brazil. Celirio Inacio, executive director at ABIC, warned that rising coffee prices could fuel domestic inflation. As the world’s second-largest coffee consumer, Brazil may see cost increases passed directly to its population.
“Coffee is becoming more expensive for consumers again,” Inacio said, adding that growing consumer complaints reflect broader inflationary pressures. Both the International Coffee Organization and Brazil’s national crop agency Conab have cautioned that the tariffs could elevate global coffee prices in the near future.
