By Marcelo Teixeira and Seher Dareen
NEW YORK (Reuters) – The United States’ National Coffee Association asked the Trump administration to exempt the product from any tariffs, saying the already adopted additional duties on Canada and Mexico could increase U.S. prices up to 50%.
In a letter seen by Reuters, NCA President and CEO Bill Murray told U.S. Trade Representative Jamieson Greer there is no alternative to imported coffee, “unlike other cases where tariffs may address unfair practices or incentivize domestic producers.”
The NCA has over 200 members, including coffee importers, exporters, traders, brokers, roasters and retailers. The industry group said the sector contributes $343 billion per year to the U.S. economy, with three in four Americans being regular coffee drinkers.
The North American coffee industry is highly interconnected, with roasting, packaging and trading operations in the U.S., Canada and Mexico, so the extra U.S. tariffs have created great uncertainty.
Most types of coffee are excluded from the USMCA free trade agreement among the U.S., Mexico and Canada, so they would likely be subject to the extra duties immediately when the 25% additional U.S. tariff goes into effect.
The NCA also asked the administration to refrain from imposing any tariffs on countries that produce coffee, saying that would have “even more significant consequences.”
The U.S. is the world’s largest importer and consumer of the beverage.
Brazil is the largest supplier of coffee to the United States, which also buys large amounts from Colombia and other Central and South American countries. Talks are ongoing between some of these countries and the U.S. administration.
The potential for tariffs on South America was one factor cited by traders fueling the recent record on coffee prices, which rose over $4 per pound in the wholesale market in February.
(Reporting by Marcelo Teixeira and Seher Dareen; Editing by Richard Chang)
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