The U.S.–Brazil coffee trade is facing turbulence after U.S. President Donald Trump imposed a 50% tariff on Brazilian goods. The move has prompted U.S. coffee buyers to postpone imports of Brazilian coffee, creating ripples in the global coffee supply chain.

Key Facts at a Glance

Category	Details
Tariff Rate	50% on Brazilian goods
Buyer Strategy	Postponing coffee imports until tariff updates
Inventory Buffer	30–60 days available in U.S.
Exporter Impact	Higher costs due to ACC-related interest & fees
Futures Market Loss Risk	$10 per bag loss if shipments shift from Sep → Dec
July Export Decline (YoY)	-28.1% overall
Arabica Decline	-20.6%
Robusta Decline	-49%
Top Markets	U.S., Germany, Italy, Belgium

Why Buyers Are Holding Back

With a 30–60 day inventory cushion, U.S. coffee buyers can afford to wait for possible tariff negotiations before committing to fresh orders. This cautious approach aims to avoid paying higher duties, but it puts pressure on Brazilian exporters who rely heavily on Advances on Exchange Contracts (ACCs). These financing tools now carry added costs from interest and fees due to delayed shipments.

Financial and Market Strain on Exporters

The inverted coffee futures market compounds the challenge—postponing shipments from September to December could cost exporters an extra $10 per bag, making the delays even more financially damaging.

Steep Export Declines

In July, Brazilian green coffee exports fell 28.1% year-on-year, with arabica shipments down 20.6% and robusta nearly halving at -49%. These declines underline the strain on Brazil’s coffee sector amid changing trade policies.

Global Trade Implications

While the U.S. remains Brazil’s largest coffee buyer, other major importers like Germany, Italy, and Belgium are closely watching the situation. If the tariffs persist, Brazilian exporters may shift their focus toward these and other markets to offset U.S. demand losses.