By Ryan Hanrahan, University of Illinois’ FarmDoc project
Reuters’ Ismail Shakil and Marcelo Teixeira reported that “President Donald Trump on Thursday removed his 40% tariffs on Brazilian food products, including beef, coffee, cocoa and fruits that were imposed in July to punish Brazil over the prosecution of its former president, Trump ally Jair Bolsonaro.”
“The move follows a similar order by the administration last Friday to remove tariffs on several agricultural products from other countries as the White House makes a U-turn on some tariffs that have increased the cost of food in the United States,” Shakil and Teixeira reported. “The order will affect Brazilian imports to the U.S. on or after November 13 and may require a refund of the duties collected on those goods while the tariffs were still being charged, according to the text of the order released by the White House.”
“Brazil normally supplies a third of the coffee used in the United States, the world’s largest coffee drinker, and has more recently become an important supplier of beef, particularly the type that is used to make burgers,” Shakil and Teixeira reported.
Politico’s Daniel Desrochers reported that “the U.S. imported $42.3 billion worth of goods from Brazil in 2024, including about $8 billion worth of food products from the agricultural powerhouse. The latter includes more than $2 billion worth of coffee, several billion dollars more of meat, orange juice and sugar and smaller amounts of fruit, spices, vegetables, dairy and other agricultural products.”
“Commerce Secretary Howard Lutnick, in an interview Thursday on Fox Business Network, said Trump was rolling back food tariffs to make a fresh start after broadly threatening countries with tariffs earlier in the year,” Desrochers reported. “‘What happened is the president said, ‘Look, it’s been six months. It’s time. Let’s just wipe the slate clean. If people haven’t made deals with these smaller countries, it’s OK. Let’s cut the price on all these unavailable natural resources, and let’s focus on affordability,’ Lutnick said.”
U.S. Cattle Prices Fall
Drovers’ Tyne Morgan reported that “even the fear of Trump removing the steep tariff on Brazilian beef caused cattle prices to tank earlier this week. Brad Kooima with Kooima Kooima Varilek told Michelle Rook on Monday that concerns of the tariff being lowered was part of the selloff in the cattle futures last week and why the market started off lower Monday.”
“Looking ahead, Rook reports the other major issue hanging over the cattle market is when the Trump administration will reopen the Mexican border to live cattle import,” Morgan reported. “Some reports say the Trump administration is pushing for that to happen in January.”
Global Coffee Prices Plunge
Reuters reported that “global coffee prices plunged on Friday after U.S. President Donald Trump removed 40% tariffs on imports of Brazilian agricultural products including coffee and cocoa in the face of growing angst from American consumers about high food costs.”
“At 1017 GMT, arabica coffee futures on the ICE exchange, used as a benchmark to price physical coffee around the world, were down 4.6% to $3.5925 per lb, having earlier plunged more than 6% to two-month lows,” Reuters reported. “Futures prices for robusta coffee beans, typically used in instant coffee rather than in the roast and ground blends where arabica dominates, were down 5% to $4,400 a metric ton, having earlier sunk 8%.”
Shakil and Teixeira reported that “‘you can expect some thousands of bags of Brazilian coffee that were sitting in bonded warehouses to start moving quickly to U.S. roasters,’ said commodities analyst Judith Ganes, president of J. Ganes Consulting. Bonded warehouses are storage facilities where importers can leave products without paying import duties. Several importers stored products in those facilities after the heavy Brazilian tariffs were announced, while they waited for an eventual revision of the duties.”
