Colombia Cacao and Coffee
It has long been celebrated as a global powerhouse for coffee and cacao, offering premium beans cherished by baristas and craft chocolate makers. But what happens when a 50% tariff is imposed on these beloved commodities? It starts at 25%, yes. And, yes, if it isn't met is is then raised to 50%, and yes, supposedly it has been solved already although there are no news reports on what the solution is....
TLDR? The Administration wanted to use military planes to deport folks. And Colobmia said "no". And talked back while showing strength and sovereignty. The repercussions of the (fake) far-reaching tariff, impacting producers, exporters, importers, and consumers in profound ways. Let’s break down how such a tariff could reshape the landscape for Colombian cacao.
Here is some domestic political representation.
The recent (potential) imposition of tariffs between the United States and Colombia stems from a dispute over deportation flights as this author mentioned. Colombian President Gustavo Petro refused to allow two U.S. military aircraft carrying deported Colombian nationals to land, each carrying approximately 80 deportees. In response, U.S. President Donald Trump announced "emergency tariffs" on Colombian imports, starting at 25% and set to increase to 50% within a week as stated earlier. Additional measures included travel bans and visa cancellations for Colombian government officials and their allies. Because of course it does.
Producers: Squeezed at the Source
For Colombian farmers, 20% of America's coffee and cocoa (65 tonnes of "fine flavor" cacao a year, a 50% tariff represents a harsh blow to their livelihoods and intrinsically, YOUR quality of life. These producers, many of whom operate small family-owned farms, already contend with volatile global prices, rising production costs, and the challenges of sustainable farming. They won't lower their prices to survive because they can't. Its a tariff... A significant tariff would make their exports more expensive and less competitive in key markets like the United States, where Hawaii Coffee, Cacao and Chocolate already have a higher premium.
The result? Reduced demand for Colombian products and pressure on farmers to lower their selling prices, potentially eroding their already slim profit margins. In worst-case scenarios, some farmers may abandon coffee and cacao production altogether, leading to long-term economic and cultural losses. In Hawaii, we produce so few tonns, it would be IMPOSSIBLE to see an increase in our markets or sales due to tariffs on Colombia.
Exporters: A Slippery Slope
Colombian exporters you would think, need to either absorb part of the tariff—a move that could strain their operations—or risk pricing themselves out of global competition. Which is I guess what the Administration wants for all our global trade ally's. Though again, w/o infrastructure of more cacao farms, Hawaii will be lacking in manufacturing just like every other state regardless of industry. Don't slip. Reader's will be paying the tariffs or buying our premium Hawaii Chocolate.
My Favorite Quote So Far Against the Shock and Awe Campaign of the Broligarchy
By Gustavo Petro: So, if you know someone who is stubborn, that's me. You can try to carry out occur with your economic strength and your arrogance like they did with L and Day. But I will die in my law, I resisted torture and I resist you. I don't want slavery is next to Columbia, they already have had too many, and we freed ourselves. You will [would] kill me, but I will survive in my people, whicc is before yours, in the Americas. We are people of the winds, the mountains, the Carribbean Sea and of freedom. You don't like our freedom, okay. I don't shaek hand with shite slavers. I shake hands with the white libertarian heirs of Lincoln and the and white farm boys of the USA, as whose graves I cried and prayed on a battlefiled, which I reach after walking the mountains of Italian Tuscany and after being saved from Covid.
They are the United States and before them I kneel, before no one else. Overthrow me, President, and the Americas and humanity will respond.
This blog post accounts for just one craft chocolate makers response.
50% Tariff Paid by Voters & Consumers
For customers like ours, imagine doubling, what you pay for coffee and chocolate. Your quick. It was dumb wasn't it. While some aficionados may continue to pay a premium, many consumers will opt for parallel substitutes, such as origins like Hawaii, Brazil or Vietnam but cheap commodity cacao from West Africa is not legally food.
Lets not dilute awareness of the unique flavors and cultural heritage they bring to global markets. Obviously cacao, more than wine and coffee, represents the uniquesness of the single terroir it is grown on.
The recent imposition of any tariff by the United States on any goods, following any refusal to accept U.S. deportation flights, will continue to elicited significant international reactions.
Key figures and nations have expressed concerns over the escalating trade tensions and their potential global economic implications.
Mexico: The Mexican peso experienced a 1% depreciation against the U.S. dollar after President Trump's announcement of tariffs on Colombian goods, reflecting market apprehension about the U.S.'s trade policies.
Reuters
Brazil: Brazil's foreign ministry condemned the "degrading treatment" of its citizens during U.S. deportation flights, highlighting broader regional discontent with U.S. immigration enforcement methods.
Reuters
Importers: A...choice?
Its how importers function. Importers of Colombian coffee and cacao would face an obvious choice: pass the added costs onto consumers. Given the premium nature of Colombian coffee and cacao, many importers may find it challenging to justify significantly higher prices without losing customers to more affordable alternatives.
The importers clients or clients' clients may decline to pay for the goods with the new additional cost. Tariff-ick...
Importers will reduce their Colombian inventory, shifting focus to countries not subject to tariffs. This is the actual shift. This is what causes an intended cycle of declining trade.
Policy Implications: A Call for Dialogue
Thoughtful trade policies that balance economic interests with fair market practices would consider the broader implications of such tariffs, from the economic fallout for small-scale producers to potential supply chain disruptions and consumer price increases. But nah...
They want you to buy American. Luckily we do produce delicious cacao and craft chocolate in the states!
Conclusion: A Bitter Sip and a Sour Bite
A 25% or 50% tariff on Colombian coffee and cacao would ripple through every link in the supply chain, with Colombian farmers and US consumers bearing the brunt of the impact. Importers, exporters will oversee the shift in trade dynamics.
As Hawaii cacao and craft chocolate makers and bloggers, we should advocate for policies that preserve fair trade, sustainability, and accessibility for all. Even if it would benefit us. It benefits this author so much when you read the blogs! Thnak you so much! And thank you for sharing this blog, liking and commenting to ensure these blogs continue to improve.
Here are some references for some deeper research:
Super informative blog, thank you for addressing this topic. I am hoping the tarriff talk goes away and things go back to normalish ....😔