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The Wall Street Publication > Blog > World > Espresso chain grapples with tariffs as java costs boil over
World

Espresso chain grapples with tariffs as java costs boil over

Editorial Board Published October 4, 2025
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Espresso chain grapples with tariffs as java costs boil over
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The primary Gregory’s Espresso opened in 2006 on Manhattan’s Park Avenue. Nineteen years later, the family-owned enterprise has expanded to over 54 places across the U.S. in addition to a roastery in Queens, New York, that handles espresso beans from Brazil, Rwanda, Nicaragua and different main international producers.

For Gregory Zamfotis, founding father of the New York Metropolis-based chain, the enterprise is about extra than simply {dollars} and cents — it’s additionally about recognizing the particular place espresso has lengthy had in American tradition as a driver of social connections.

With many People nonetheless feeling the consequences of elevated inflation, for a lot of espresso drinkers, a type of conversations is prone to middle on the drink’s hovering prices. 

Costs have leaped practically 21% over the previous 12 months, with the common retail value of 100% floor roast espresso just lately reaching a document excessive of $8.87 per pound, up from $7.02 in January, USDA knowledge exhibits. 

A number of elements are behind the spike in espresso costs, together with droughts in Brazil and unstable climate in different areas the place the bean is cultivated. Extra just lately, heavy U.S. tariffs on coffee-producing nations — together with a hefty 50% levy on Brazil — have additionally pushed up costs. 

Although espresso is a staple of American day by day life, the overwhelming majority of the beans is imported. A lot of that’s sourced from Latin America, with Brazil alone accounting for 35%, in keeping with the U.S. Division of Agriculture.

In contrast, the U.S. produces comparatively little espresso in comparison with the remainder of the world. Hawaii, the top-producing state, harvested 21 million kilos throughout the 2024–25 season, in keeping with the USDA. But People consumed a whopping 3.3 billion kilos of espresso throughout the identical interval, the company mentioned.

“Prices are going to have to go up”

Jake Leonti, director of espresso at Gregory’s Espresso, mentioned it’s additionally far pricier to develop and produce espresso within the U.S.

“It’s exponentially [more] expensive because it’s Americans farming,” he mentioned. “Whereas we can get super high-quality coffee from different parts of the world at a price that’s much more friendly to the consumer.”

Gregory’s Espresso has not raised costs but regardless of the bounce in prices. However Leonti mentioned that would change quickly. 

“Prices are going to have to go up — there’s no other way around it,” he mentioned. “We’re seeing tariffs from the places where we get our bags printed as well. So everything around the coffee business is getting tariffs at some point.”

Like different retailers, Gregory’s costs differ relying on the place a retailer is positioned, reflecting regional labor and different prices. In New York Metropolis, the chain fees $3.45 for a daily cup of espresso, whereas at its New Jersey and Washington, D.C., shops the identical merchandise runs $3.15.

Different retailers are additionally getting ready for elevated espresso prices. Mark Smucker, CEO of The J.M. Smucker Co., whose portfolio contains the Folgers Espresso, Café Bustelo and Dunkin’ at-home manufacturers, mentioned throughout the firm’s fourth-quarter earnings name in June that costs will possible improve for a 3rd time this 12 months “due to higher green coffee costs.”

In the meantime, Starbucks Chief Monetary Officer Catherine R. Smith mentioned throughout the firm’s third-quarter earnings name in July that, as a result of firm’s espresso shopping for and hedging practices, clients shouldn’t anticipate value will increase till the primary half of fiscal 2026.

At Gregory’s Espresso, “The last thing we want to do is just keep raising prices on our guests,” Zamfotis mentioned. “We’re hoping that if prices go up a few pennies across the board, that doesn’t turn off our everyday customers. We’re not doing this to make more money — we’re doing this to protect our business.”

How briskly are costs rising?

Extra from CBS Information

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