Tariffs have been all over the news regarding coffee since January 2025.
Here is my outlook on it and how I see it playing out the rest of 2025.
First off, have tariffs impacted the cost of our coffee? Yes and no.
Yes, subsequently with talk of tariffs starting in end of 24’ and in January this year we’ve noticed volatility in the coffee market and prices fluctuating a lot. We raised our prices on January 1st this year in preparation but also because we’ve not updated our pricing in 3 years for our subscription line up.
No, we’ve navigated the price fluctuations by cutting back on expenses, communicating with our green buyer consistently on our needs and how to best navigate/substitute coffee for blends when we need to. This has ultimately kept us moving and saves you our customers the extra cost.
As of August 10th, there was a 50% tariff on all Brazil imports. Unfortunately that means coffee, too. We’ve already made plans for substitutes for Brazil in our line up if the 50% tariff holds. The coffee we’ve got coming in through the end of Q3 is already in country and not subjected to this 50% increase in cost. Once Q4 hits this year, we’ve already made plans to substitute Brazilian coffee in our line up with coffee from Mexico as it has a very similar profile, cost is on par with what Brazilian costs were prior to the August 10th tariff, and will work perfectly to help us avoid additional price increases.
Now, ultimately with the 50% tariff hit on Brazil, this will cause costs to rise across the board with coffee. Brazil is the top coffee producing country in the world along with Vietnam. With increase in demand on coffee from other countries the price will go up over time, however, I’m optimistic that decreased demand for Brazil because of the tariffs will cause a deal to be made sooner rather than later.
Will we raise our costs this year? Likely not, unless something drastic happens, I have no intentions of raising prices as coffee is pretty versatile when it comes to blends. Single origins may be pricier, however, this is worked into our margins and we’ll eat it temporarily since the market fluctuates daily.
I’m also optimistic that a deal will be made and at least stabilize the coffee market in the next 6 months. I say stabilize because even in 2024 the market has fluctuated far more than previous years. But, what I’ve learned talking to our green buyer is this. The coffee market does this every 8 to 10 years. As far as what we’re doing here at VCC is just taking it day by day, focusing on what we can control, and making adjustments if we need to. So incase you’re wondering if our product cost is going to increase any time soon. The answer is no. Long term? Maybe. We’ll cross that bridge when we get to it.