Canada plans to slap a tariff on ‘U.S.’ sourced beans and many Canadian stores buy from American brokers
When someone comes for our coffee, it feels personal. A threat to our coffee is not just a threat to that cloud of pleasant alertness, it’s a threat to our social gathering spaces, our comfort, our memories and our sense of self. We’re double-double, flat white or americano. (Well, maybe not americano.)
We are also wholly dependent on other countries to supply this mildly intoxicating daily drug. That’s why tariffs, or more accurately, retaliatory counter-tariffs are producing a buzz of anxiety in Canadian coffee lovers.
“Coffee is a unique commodity. Neither Canada nor the U.S. produces it,” said Srabana Dasgupta, an associate professor of business administration at SFU. But, “Canada relies on American supply chains and brokerage houses in the U.S. for most of its green coffee beans.”
That means coffee imported from another country, like Colombia, might be considered a U.S. import if it is purchased from an American brokerage house that buys coffee and resells it. A weak Canadian dollar will make that cup of coffee even more expensive, said Dasgupta.
Canada’s geographical position close to the U.S. makes this the most efficient way to get coffee beans. “The only alternative is to find other supply chains, but that can take a very long time,” said Dasgupta.
Boycotting American-owned companies like Starbucks may affect a local staff, said Dasgupta. And non-American big players like Tim Hortons, which is foreign owned but has an independent franchise model, also rely on beans that come through the U.S.
John Neate, CEO of JJ Bean, a 23-store local chain that buys green beans and roasts them itself, said he’s cautiously optimistic after U.S. President Donald Trump put a 30-day hold on his proposed 25 per cent tariffs on Canadian goods, but he’s not convinced it’s over.
“Trump is a bully, and he’s going to do whatever he wants,” said Neate. “We’re trying to figure this out.”
Neate is considering all options, including buying a larger-than-usual order of coffee beans during the 30-day pause on tariffs.
Coffee suppliers that buy direct and bring in full containers, which hold 275 bags weighing 154 pounds each, can avoid potential tariffs.
But local roasters like JJ Bean that offer several different varieties of coffee buy smaller amounts from U.S. brokerage houses that act as a middleman.
“We buy 20 or 30 types of coffee, so we don’t need container loads,” said Neate. Once the coffee touches U.S. soil, it’s considered an import from the United States.
He estimates 75 per cent of approximately about 300 tonnes of coffee his chain purchases annually comes through a broker, and 25 per cent comes in direct shipments.
Keeping the doors open gets even more complicated, said Neate. Coffee prices had already surged in 2024 to their highest since the 1970s, due to drought and heat waves in Brazil and Vietnam. Additionally, coffee beans are only part of what a coffee house needs to stay in business.
“Most of the equipment comes from the U.S., that includes machinery. The packing bags are made in China, the U.S. is charging China a 10 per cent tariff, but we bring them in through the U.S., so we just don’t know yet what all this means,” said Neate.
When the bottom line is affected, so is the cup of coffee you drink, but Neate hopes the sense of community JJ Bean provides will prevail.
“People still have the desire to see other people, and having a coffee is cheaper than having a cocktail,” said Neate.