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Investing.com -- The proposed 50% import tariff on Brazilian goods by the Trump administration would effectively stop Brazilian coffee from reaching the United States, according to trade sources, cited by Reuters on Thursday.
U.S. coffee roasters would be unable to absorb the 50% price increase on Brazilian beans, while Brazilian exporters lack the margin flexibility to reduce prices enough to offset such a substantial tariff, the Reuters report said.
The United States currently stands as the largest buyer of Brazilian coffee. If implemented, the tariff would force U.S. roasters to find alternative coffee sources from other countries.
Meanwhile, Brazilian coffee exporters would likely redirect their shipments to markets in Europe and Asia to compensate for the lost American business.
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