Brazil coffee sector warns US tariff loss will slash exports

By Caleb Reed · 2026-07-14

The exemption and how it works

The Office of the United States Trade Representative determined on 1 June 2026 that certain Brazilian trade acts and policies were unreasonable under Section 301, and proposed applying 25% additional duties on all Brazilian goods.verifiedVerified Source: ustr.gov^[1] Green and roasted coffee, classified under HTS 0901.11-0901.90, were explicitly carved out on the grounds that the product cannot be grown in sufficient quantities within the United States.^[2]

The Section 301 investigation into Brazil's practices began in July 2025, covering digital trade, preferential tariff arrangements, and related issues.^[1] The Federal Register notice confirmed that the 25% duty proposal would sweep across all Brazilian goods categories, making the coffee carve-out one of the few explicit exclusions in the package.^[2]

Who is lobbying whom

National Coffee Association President and CEO William "Bill" Murray testified in Washington on 8 July 2026, calling on the administration to lock in the exemption and extend it to cover unflavored instant coffee.^[3] Murray said: "It is critical for more than 176 million daily U.S. coffee drinkers and our $343 billion coffee economy that any tariffs resulting from the current Special 301 investigations exclude all coffee and coffee products, most of which NCA applauds the administration for having already included in proposed exclusions."^[3]

Murray said the proposed exclusions should be extended to include "unflavored instant coffee consumed by nearly 30 million American adults each day and used as a critical ingredient in value-added manufacturing of coffee extracts, flavorings, cold brew, and ready-to-drink beverages."^[3] The NCA represents producers, roasters, and brands responsible for 90% of US coffee commerce.^[3]

Ambassador Jamieson Greer, the United States Trade Representative, flagged the statutory clock in the same June announcement. Greer said: "I look forward to continuing engagement with the Brazilian Government in advance of the July 15, 2026 statutory deadline for taking responsive action."^[1] That deadline left the exemption's permanence unresolved at time of publication.

Volumes at stake

Between 6 August and 21 November 2025, when the United States imposed a 50% tariff on Brazilian coffee, exports to the US plunged 54.9% year-on-year, from 2.917 million 60-kg sacks to 1.315 million sacks.verifiedVerified Source: cecafe.com.br^[4] Brazil's coffee export council Cecafé documented the collapse and warned that any extension of punitive duties into 2026 would compound the damage.^[4]

The July 2026 data showed the trend reasserting itself early. As of 6 July 2026, Brazilian coffee export certificates issued for US-bound shipments totalled 466,051 60-kg sacks, down from 609,161 sacks in the same period of July 2025, a fall of 23.5%.verifiedVerified Source: cecafe.com.br^[5] The decline arrived while the current exemption technically remains in place, a sign that market uncertainty alone is disrupting trade flows.

The $4 billion revenue warning

Cecafé projected that US tariffs extended into 2026 would cost the Brazilian coffee sector more than US$4 billion in export revenue.^[4] Brazil is the world's largest coffee exporter, supplying more than 30% of the US market, which makes any sustained tariff barrier a structural threat rather than a short-term disruption.^[4]

The 2025 tariff period showed how quickly buyers redirected orders. A 54.9% volume drop across just 15 weeks demonstrated that American importers moved fast when facing a 50% cost penalty, drawing down stockpiles or pivoting to alternative origins.^[4] A repeat in 2026, even at 25%, would hit Brazilian producers during a period when global coffee prices are already elevated.

What US drinkers face if the gap widens

Murray's testimony drew a direct line between the tariff structure and retail prices. The NCA's $343 billion economic footprint figure and the 176 million daily drinkers statistic were put forward to reinforce that coffee is not a discretionary import; it is an embedded part of the US food system.^[3] The instant coffee gap was Murray's sharpest point: the HTS carve-out as proposed covers green and roasted coffee but leaves unflavored instant in a grey zone, exposing a segment consumed by nearly 30 million adults each day to potential tariff pass-through.^[3]

Instant coffee is also a key input for manufacturers of ready-to-drink beverages, cold brew concentrates, and coffee-flavoured products, a supply chain well beyond the mug on the kitchen bench.^[3] Any tariff applied to that category would ripple well past the café counter.

The Australian import angle

Australia's specialty roasting sector sources a meaningful share of green beans from Brazil, the world's dominant arabica and robusta supplier. A sustained contraction in Brazilian export volumes to the US would push more Brazilian supply toward other markets, including Australia, potentially easing price pressure; but only if the disruption is prolonged. A short-term uncertainty shock is more likely to tighten global spot availability as traders hedge positions ahead of the 15 July 2026 USTR deadline.^[1]

Australian importers who purchase Brazilian beans through US-based intermediaries face a more direct exposure. If the 25% broader goods tariff disrupts trading relationships or pushes intermediary costs higher, landed prices in Australia will feel the knock-on. Murray's testimony on 8 July 2026 and Ambassador Greer's 15 July statutory deadline are now the two dates that matter most to anyone in the global coffee supply chain.

Caleb Reed

Caleb Reed covers breaking news and sport for Bushletter. Fast and verb-led, he writes with a news-wire cadence and no patience for PR spin.