In April 2025, Donald Trump, President of the United States, announced the imposition of new trade tariffs on more than 180 countries. Although the tariffs have been temporarily suspended in most countries (with the exception of China), the US President pointed out that the measure aims to apply reciprocal tariffs on products imported from countries that impose high taxes on US goods. 

The measure is also aimed at protecting producers from foreign competition and stimulating production and domestic demand. As a major global power, the U.S. initiative has a direct impact on the agricultural commodities market. 

While there are growing concerns that excessive tariffs on China will increase the likelihood of a global recession and impact overall demand, there are still no agreements with other countries to reduce tariffs. Thus, after the 90-day pause, tariffs are expected to return, further impacting the global economy as the United States has partnerships with a wide range of exporting countries such as Brazil, China and members of the European Union. 

As such, additional tariffs will directly impact these economies and create new challenges to remain competitive. In this article, we will understand the global implications of this action. Enjoy the read! 

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Coffee Under Pressure: Redefining Trade Flows 

The team of experts at Hedgepoint Global Markets has analyzed the tariffs imposed by Trump and identified possible changes in the coffee market. As mentioned above, coffee exporting countries are currently in a 90-day temporary pause. However, as there is still no agreement between countries, major coffee exporters are expected to be hit hard once the tariffs are reinstated. Vietnam and Indonesia are among those most affected by the tariffs, with rates of 46% and 32%, respectively. The rest of the major producers are on the 10% list, as are Brazil, Colombia, and several countries in East Africa and Central America.  

The United States is the largest consumer of coffee in the world, and the tax could raise prices for Americans. As a result, domestic demand and imports are expected to fall throughout the year.   

In addition, the tariff was applied at a sensitive time for the coffee market. Some producing countries have low stocks, and the drop in the Brazilian Arabica crop may restrict supply. All these factors raise a red flag for potential impacts on price dynamics and demand.   

According to Hedgepoint’s analysis, the difference in tariffs could lead to changes in the flow of coffee trade. Countries with lower tariffs, such as Brazil and Uganda, could begin to satisfy a larger share of U.S. demand. However, higher tariffs for Asian countries are likely to divert supply from those economies to other markets. 

“For this reason, the scenario is more delicate for robusta coffee. As Vietnam and Indonesia have received higher tariffs, there will be a contrast with the lower tariffs applied to Brazilian conilon. This difference could change the market balance as higher prices in Asia shift U.S. demand to origins with lower tariffs,” says Laleska Moda, Market Intelligence Analyst at Hedgepoint. 

In addition to raw beans, regions that export processed coffee, such as the European Union, have also been targeted by the new tariffs. This measure may alter the competitiveness of countries such as the United Kingdom, which also exports industrialized coffee but was not included in the list of additional tariffs. 

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Soybeans and corn: Trump tariffs pose global accumulation and diversion risk 

According to Hedgepoint experts, the impact of the new tariff package on soybeans and corn is complex. For oilseeds, the first signs will come from China, the world’s largest buyer of the commodity. The country has already reduced its reliance on U.S. soybeans by 35% in the past year, and the trend is for this to fall even further with the tariffs. 

Initially, China was hit with a 34% tax on top of the 20% already imposed. However, the Asian country responded with additional tariffs of the same percentage on all U.S. imports. In retaliation, Trump decided to increase the tariffs by 50%, reaching 104%. 

On Wednesday, April 9, China also increased its tariffs to 125%, while the United States changed again to 125%. All of these changes suggest that both countries have not yet reached an agreement and that the tariff war is likely to have a strong impact on the soybean market. 

The Hedgepoint team points out that Brazil’s bumper crop is likely to play an important role in this scenario. The South American country has been gaining market share internationally, which tends to increase U.S. stocks and push prices on the Chicago Board of Trade (CBOT) to more competitive levels. 

The corn market follows the same logic. The reduction in Chinese imports from 23 million to just 8 million tons in one year, combined with a good Brazilian harvest, is likely to leave the U.S. market with higher stocks. This scenario should also put pressure on prices for the commodity. 

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US tariffs and the indirect impact on the sugar market 

For the sugar sector, the US tariffs were the result of a macroeconomic reflection. The anticipation of Trump’s announcement interrupted the support provided by the weaker March crushing figures in India and contributed to a fall of almost 2.5% in sugar prices. 

The market reacted with high volatility, particularly following a drop of more than 7% in oil prices and the appreciation of emerging currencies against the dollar. Nevertheless, sugar found support in the Chinese import arbitrage, with prices approaching 18.7 c/lb and closing the week at 18.84 c/lb, avoiding even greater losses. 

According to Hedgepoint Market Intelligence Coordinator Livea Coda, “The exemption for Canada and Mexico kept sugar flows relatively unchanged. However, TRQs are expected to start paying the new tariffs, which increases the advantage of Mexican sugar over other exporters”. 

Another point is that the market remains attentive to the arrival of the new Brazilian crop. The early start of crushing at several mills in the country reinforces expectations of higher supply in the short term. 

Impact of Trump’s tariffs on the cocoa market  

For cocoa, the announcement of new trade tariffs triggered immediate reactions in global markets. Commodity prices began to fall amid increased volatility, contributing to a scenario of uncertainty.   

Last Tuesday, cocoa futures contracts expiring in May 2025 fell 3.8% in London and 3.7% in New York. This behavior signals a correction in the market after the significant rise. If the U.S. tariffs remain in place, trade flows may change as the U.S. seeks more economical alternatives. 

The market is already anticipating a possible reduction in grinding of North American cocoa, which could put pressure on prices within the country. Possible solutions include redirecting almonds to countries close to the United States that have lower tariffs and installed grinding capacity, such as Canada, Mexico, Brazil and Ghana. This would allow U.S. demand for almonds, butter, liquor and cocoa powder to be met by processing in other countries. 

Price volatility in the agricultural market  

Donald Trump’s tariff marks a possible geopolitical realignment of agricultural commodities. Exempting some countries and penalizing others creates new opportunities and challenges for exporters. However, financial markets are responding with volatility and pressure on prices. 

In this context, risk management becomes even more important. At Hedgepoint, you can count on agricultural commodity hedging experts and regular updates on the impact of tariffs on the sector. Contact our team and manage financial risk with market intelligence. 

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