Trump cuts tariffs on goods like coffee, bananas and beef in bid to slash consumer prices

President Donald Trump on Friday exempted key agricultural imports like coffee, cocoa, bananas and certain beef products from his higher tariff rates.

The move comes as Trump faces political blowback for high prices at U.S. grocery stores. Some distributors of beef, coffee, chocolate and other common food items have raised prices as Trump’s tariffs took hold this year, adding to pressure on household budgets created by decades-high inflation in recent years.

Trump’s action Friday also exempts a range of fruits including tomatoes, avocados, coconuts, oranges and pineapples. Along with coffee, the tariff reductions extend to black and green tea, and spices like cinnamon and nutmeg.

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The move marks a reversal for Trump, who has insisted tariffs are necessary to protect U.S. businesses and workers. He has contended U.S. consumers will not ultimately pay for the higher duties. (Click here to read Fed 150 Year Study saying Tariffs LOWER Costs!)

The exemptions come just a day after Trump reached trade framework agreements with four Latin American countries – including 10% tariffs on most goods from Argentina, Guatemala, and El Salvador, and 15% from Ecuador. It also removes duties specifically on products not grown or produced in the U.S. in sufficient quantities, like bananas and coffee.

Rising food prices have hampered U.S. households for several years. Consumer Price Index data show food-at-home prices increased approximately 2.7% year-over-year in September. (More recent data was delayed because of the government shutdown).

The tariff exemptions aim to help moderate these grocery price increases, although experts caution that other factors such as global supply shortages also influence prices, especially for coffee and beef.

Here’s more background on how industries like beef, coffee and cocoa have reacted to tariffs and rising prices.

Will It Work? 

Experts said the trade deals could help alleviate some of the pressure on price increases, but are unlikely to lower prices quickly.

"While we might expect some price reductions for the affected goods, there’s no guarantee that these savings will fully reach consumers," said Can Erbil, a professor of economics at Boston College and an expert on international trade. "Factors such as supply chain adjustments, wholesale pricing, and retailer decisions could absorb some of the benefits. Additionally, any changes on the shelves may take weeks or months to materialize as contracts and logistics adjust."

Although the overall impact on the cost of living will be small, prices for certain products could fall noticeably, said Daniel A. Sumner, a professor of economics at UC Davis specializing in agricultural economics.

"For important foods, like bananas and other fresh produce that are primarily imported and have smaller processing and marketing costs, the percentage retail impacts will be significant," he wrote in an email.

"For others, such as beef, where the import share is small and considerable processing and marketing costs may occur in the U.S., the retail price impacts in percentage terms may be quite small."
 

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