Coffee prices are expected to stay elevated as the market prepares for tariff-related volatility. New York futures for arabica are already near record highs due to weather issues and growing conditions in key regions, while robusta futures in London have also spiked over the last year.

On the tariff front, TD Cowen highlighted that the most notable U.S. coffee imports are derived from Brazil (10% tariff), Colombia (10% tariff), and Switzerland (31% tariff) that collectively made up 52% of 2024 U.S. coffee imports. There is also the shock 46% tariff on Vietnam exports to consider.

Based on the new tariffs announcements, analyst Andrew Charles and his team estimate a weighted average global coffee tariff of 14.5% that may or may not be passed on to consumers.

While coffee-related companies typically hedge many of their coffee costs, they could see an impact due to increased volatility and uncertainty in the market. In the restaurant sector, TD Cowen sees a negative adjusted EBITDA impact for Starbucks Corporation (NASDAQ:SBUX), Dutch Bros (NYSE:BROS), and First Watch Restaurant Group (FWRG) if tariffs are unmitigated.

Other companies that could face coffee pricing headwinds include Coffee Holding (NASDAQ:JVA), Dunkin' Brands (DNKN), J.M Smucker (SJM), Starbucks (NASDAQ:SBUX), McDonald's (MCD), Costa Coffee (KO), Tim Hortons (QSR), Nestle (OTCPK:NSRGY), Keurig Dr Pepper (KDP), Kraft Heinz (KHC), Krispy Kreme (DNUT).