Crisis from US Tariff Hike on Brazilian Coffee: Rising Export Opportunities in the East Asia

The United States (US) government’s decision to impose tariffs of up to 50% on Brazilian coffee beans has triggered a major trade crisis for Brazilian producers, who have traditionally supplied about one-third of US coffee imports. This policy change has created an urgent need for Brazil to identify new export markets to offset the expected losses.

Ahead of countries like Colombia, Switzerland, Canada, and Guatemala, Brazil will only be able to export coffee beans to the US at pre-tariff rates until Aug-25, as the new tariffs—announced in early July—are set to take effect on August 6. Given that Brazil’s peak coffee export season runs from Aug-25 to Oct-25, exports to the US can continue at the current tariff rate until Oct-25, after which shipment volumes are expected to decline sharply.

From Oct-25 onward, Brazilian exporters must secure alternative destinations. One anticipated measure is Brazil’s long-term agreement with 183 Chinese coffee companies, which is expected to last five years.

The tariff disruption is opening up opportunities in East Asia, particularly in countries like Korea and Japan, which have faced high demand and supply challenges. 

Figure 1. Share of Coffee Bean Export Volumes to the United States by Country

East Asia Emerges as Brazil’s Next Coffee Market

Korea and Japan stand out as key future markets, with Korea ranking first globally in per capita annual coffee consumption at 412 cups per year. This is far ahead of Singapore at 290, Japan at 281, Hong Kong at 276, and Thailand at 228. According to Euromonitor, Korea’s consumption is over six times the Asia-Pacific regional average of 57 cups. Japan is already the fifth-largest importer of Brazilian coffee, while China, although not yet at the same level, has shown steady growth in consumption.

Figure 2. Share of Brazil’s Coffee Bean Export Destinations

China Moves Toward Strategic Diversification

Brazil’s pivot to China is a clear effort to diversify exports in response to US tariff pressure. Despite China's geographical proximity to other major producers like Vietnam and Indonesia, it has granted large-scale export approvals to Brazilian coffee firms. This decision is widely interpreted as politically motivated, aimed at counterbalancing US influence.

Since 2020, China’s imports of Brazilian coffee beans have grown steadily, with a major spike since 2022, surging to three times the 2022 volume in 2023.
A country with a long-standing tea culture, China once had an annual per capita coffee consumption of just 16 cups. This was far below the global average of 240 cups, but the country has recently shown explosive growth. Driven largely by younger generations, coffee consumption has increased steadily, with coffee import volumes rising 6.5 times over the past five years. The size of China’s coffee industry grew from about USD 36.4 billion in 2023 to approximately USD 43.4 billion in 2024. This highlights the vast growth potential of the Chinese market.

Despite this continued growth, the sharp increase in coffee imports since 2022 is likely due to the domestic supply constraints caused by the rapid expansion of China’s coffee consumption. In recent years, China’s coffee cultivation industry has developed quickly and coffee bean production has been recovering. However, it still cannot meet the demands of its massive domestic consumer market, leading to a continued expansion of large-scale import dependency each year. 

The Aug-25 agreement with 183 Chinese companies (valid for five years), along with 30 additional firms securing four-year contracts, underscores the long-term growth of China-Brazil coffee trade. The Chinese government has officially approved these transactions, which include bulk purchases by major domestic coffee chains and long-term supply agreements with local roasteries. A notable example is Luckin Coffee, China’s largest coffee chain, which signed a purchase deal for 240,000 tons of Brazilian coffee beans.

Figure 3. China's Import Volume of Brazilian Coffee Beans

Japan Becomes a Rising Strategic Export Market

Already the fifth-largest importer of Brazilian coffee, Japan is well-positioned to absorb increased exports. Among Brazil’s top 10 coffee export destinations, Japan’s import volume showed a slight decline in 2023 but has been on an upward trend again since 2024, continuing the growth seen from 2021 to 2024. 

The temporary drop in import volume in 2023 was likely due to the decline in global coffee production caused by climate change in producing countries, along with the resulting surge in international coffee bean prices, which led to a stronger tendency to utilize existing green coffee bean inventories.

Figure 4. Annual Trend of Japan’s Total Coffee Bean Imports and Imports of Brazilian Coffee Beans

As the third-largest coffee consumer in Asia, Japan shows sustained interest in Brazilian beans, making further export growth likely. Additionally, increased supply from Brazil could help ease recent price hikes caused by climate-related disruptions.

Korea Tops Asia in Coffee Consumption

Alongside Japan, South Korea is emerging as a prime export destination. According to the International Coffee Organization (ICO), South Korea’s per capita annual coffee consumption is more than double the global average of 152 cups. This is likely because Korean consumers regard coffee as more than just a beverage, placing value on experience-driven consumption such as personalized menus and café hopping that reflect their individual tastes and preferences.

Korea Customs Service data shows that the country’s coffee bean import value rose by 68.5% in five years, from USD 737.8 million in 2020 to USD 1.243 billion in 2024. As the top coffee-consuming country in the Asia-Pacific region, Korea is expected to maintain this momentum. With continued growth in coffee consumption, coffee bean imports are also projected to keep increasing.

As the largest coffee consumer in the region, Korea has seen a significant rise in roasted bean imports, driven by improvements in roasting capacity and growing consumer interest in coffee flavor and quality. This trend is also fueled by the rapid expansion of premium market demand for specialty, single-origin, and decaffeinated coffee.

Figure 5. Five-Year Trend of South Korea’s Coffee Bean Imports

Figure 6.  Annual Consumption of Coffee Types in South Korea

Conclusion

As of 2025, coffee bean prices have been  steadily rising globally since 2023. The main drivers include production disruptions caused by climate change. It has become harder to export coffee smoothly because global trade rules are complicated, and some investors in financial markets are driving up prices for profit. Together, these factors have made coffee prices hit new yearly highs.

In this context, Brazil’s expansion into East Asia offers a mutually beneficial strategy in the face of US trade barriers. 

Exporting more coffee to high-consumption markets like Korea and Japan could help stabilize local prices in these countries while enabling Brazilian producers to recover lost volumes. Both facing high domestic demand and the need for new suppliers, Korea and Japan see Brazil as an opportunity to secure a more stable supply and reduce import costs in a challenging international price environment. This mutually beneficial trade relationship is also expected to pave the way for deeper cooperation and potential trade agreements.

Moreover, tapping into China’s growing coffee market could further solidify Brazil’s long-term foothold in Asia. As coffee continues to gain popularity in China, the five-year export deal, along with other extended contracts, signals a promising future for Brazil’s presence in the region. Strategic alignment between China and Brazil is also likely to strengthen as both countries work together to challenge US trade dominance.

Figure 7.  10-Year Trend in International Coffee Price