Trump's Colombia tariff threat raises fears on coffee prices

US President Donald Trump's threat to impose retaliatory 25% tariffs on Colombia briefly ignited fears of a further surge in already high coffee prices, Report informs via Axios.

Beans from Colombia make up 20% of US coffee imports, and the only source larger, Brazil, is struggling with weak crops after a series of weather disasters.

On Sunday Trump said he would impose an emergency 25% tariffs on all goods imported from Colombia — rising to 50% in one week — after the country refused to accept two deportation flights from the US

A few hours later, the White House said it was pausing those tariffs after Colombia agreed to Trump's terms.

Coffee prices were already surging before the tariff threat. Coffee futures are up 45% in the last six months. Bloomberg reported last week that wholesale prices recently eclipsed all-time highs set in the late 1970s, and that it was only a matter of days to a few weeks until retail prices followed suit.

As it stands, consumer coffee prices are already at multi-decade highs, per Consumer Price Index data.

Bird flu is causing record price shocks and shortages in eggs as well.

American breakfasts risk getting a lot more expensive, even as Trump begins a new term with a promise to lower grocery prices.

The White House statement indicated Trump was prepared to use the International Economic Emergency Powers Act of 1977 (IEEPA), which has not been used before to levy tariffs.