Tuesday, 15 July 2025 Reading time : 3 minutes

Coffee is one of the most popular beverages among Americans, with around two-thirds of adults drinking at least one cup of coffee every day. This makes coffee more popular than tea, juices and soft drinks. However, coffee lovers' daily caffeine intake could soon become noticeably more expensive.

This is due to the latest plans of US President Donald Trump, who recently announced the next stage of his tariff policy. Brazil will be hit particularly hard this time, as Trump intends to impose a 50% tariff on imports from the South American country from 1 August. American consumers are also likely to be affected, as Brazil is one of the US's most important suppliers of coffee, orange juice and beef.

Around one third of the coffee consumed in the US comes from Brazil (Reuters, Financial Times). Dependence on orange juice is also high: more than half of the fruit juice sold in the US is made from Brazilian fruit. The US currently relies heavily on imports as domestic production, particularly in Florida, has declined sharply due to diseases such as citrus greening, as well as hurricanes and frost periods (European Supermarket Magazine, ESM). For the 2024/25 season, the US Department of Agriculture is therefore forecasting the lowest orange harvest in 88 years.

Prices could also rise in fast food restaurants. Brazil is a major supplier of lean beef, which is mixed with domestic products in the US to make hamburger meat. According to data from the US Department of Agriculture, imports of Brazilian beef have more than doubled in the first five months of this year, accounting for around a fifth of US beef imports.

These tariffs are likely to further exacerbate the already tense situation in American meat production. The number of cattle herds in the US is currently at its lowest level in over seven decades due to years of drought and rising feed costs, which has already caused beef prices to rise sharply (ESM).

The US government has suggested that products that cannot be grown in the US, such as coffee and tropical fruits, may be exempt from the tariffs. However, it is not yet clear whether such exemptions will actually be granted. It also remains to be seen to what extent the US food giants will pass on any price increases to consumers.

Barrier Reverse Convertibles on US Food Producers
11.20% p.a. BRC on McDonalds, Pepsico and Starbucks
Barrier: 65%
Valor: 144 652 749

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