DUBAI – QAHWA WORLD

By any measure, coffee should be getting cheaper.

International green coffee prices have eased in recent months as production rebounds in major origins. Yet in the United States, retail coffee prices continue to climb — reaching levels not seen in decades.

According to data from the U.S. Bureau of Labour Statistics, the average retail price of roasted coffee in the United States hit $9.37 per pound in January, up 33% year over year. That marks the highest level since federal record-keeping began in the 1980s.

At the same time, global benchmark prices for green coffee have fallen to roughly $3.64 per pound, reflecting improved crop expectations and stabilising supply chains.

So why is the world’s largest coffee-consuming economy moving in the opposite direction?

Tariffs and Trade Policy Still Ripple Through the Market

The answer begins with trade policy.

During the previous administration of Donald Trump, tariffs were imposed on key coffee-exporting countries. The United States introduced:

  • A 46% tariff on imports from Vietnam

  • A 10% tariff on imports from Brazil and Colombia

Vietnam, Brazil, and Colombia collectively supply more than 60% of U.S. coffee imports. Any disruption involving these origins has immediate consequences for American roasters.

In July, an additional 40% tariff on Brazilian food and beverage imports was proposed. Although that measure was later reversed, the market had already reacted. Coffee is traded months in advance, and importers typically lock in contracts well before shipments arrive. By the time policies shift, pricing structures are already embedded in the supply chain.

In coffee, timing is everything — and costs move slowly in one direction.

The Lag Between Global Prices and Retail Shelves

Green coffee prices are only one component of what consumers pay. Roasting, freight, warehousing, labor, packaging, and retail margins all compound the final number on a supermarket shelf or café menu.

Even when global commodity prices fall, retailers rarely adjust immediately. Contracts must roll over. Inventories must clear. New pricing agreements must be negotiated.

There is also a behavioural element at play. Coffee remains a daily ritual for millions of Americans. Demand has proven remarkably resilient, even in periods of inflation. When consumers continue buying at higher prices, businesses face little urgency to cut them.

Corporate Performance Signals Strong Demand

Publicly traded coffee giants reflect this resilience.

Shares of Starbucks are up roughly 14% year to date in 2026. Meanwhile, Keurig Dr Pepper has gained about 5% over the same period.

Strong performance suggests that consumers are still spending on coffee, whether in cafés or at home. For investors, it’s a sign of pricing power. For consumers, it means relief may not come quickly.

A Market Split: Global Relief, Domestic Pressure

Globally, supply conditions are improving. Brazil’s production outlook has strengthened, and earlier disruptions in key growing regions have begun to ease. That has kept international prices from climbing further.

But the United States operates within its own pricing ecosystem — shaped by trade policy, distribution costs, and consumer behaviour.

The result is a widening gap between falling global bean prices and rising American retail prices.

Will U.S. Coffee Prices Come Down?

They may — but not immediately.

As older contracts expire and lower global prices filter through the system, wholesale costs could soften. However, whether those savings reach consumers depends on competitive pressure, corporate strategy, and demand trends.

Coffee has evolved far beyond a commodity. It is a cultural staple, a daily necessity, and for many households, a non-negotiable expense.

For now, Americans are paying record prices for their morning cup — even as the rest of the world sees relief.

And until supply contracts reset and market forces realign, that disconnect is likely to persist.