MercoPress. South Atlantic News Agency

Brazil turns to tea-drinking China to cushion 50% tariffs on coffee by US

Per capita coffee consumption in China is still only 16 cups per year, compared to the global average of 240

Amid new 50% tariffs on Brazilian coffee exports to the United States, China has authorized 183 Brazilian companies to export coffee to its domestic market. This move is seen as a way for Brazil to offset the economic impact. Jorge Viana, head of ApexBrasil, the country’s export promotion agency, called the agreement a “milestone for Brazil’s coffee sector.”

While the US remains the largest importer of Brazilian coffee, purchasing nearly 23% of its total exports in the first half of the year, China's market is growing. Brazilian industry leaders note that while China would not be a direct replacement for the volume previously sent to the US, the new licenses are a significant and unusually large batch of authorizations. This aligns with Brazil's long-term strategy to gain brand visibility for its coffee in China, which has a rising demand for specialty beans, particularly among young urban consumers.

This strategy is bolstered by a major deal between Brazil's export promotion agency and China's Luckin Coffee. The agreement, valued at a reported US$2.5 billion, will see Luckin Coffee purchase 240,000 metric tons of Brazilian coffee beans between 2025 and 2029.

So far, 85% of Brazil’s 2025 production of Arabica, the variety most exported to the US, has already been harvested. In the US market, it is often blended with milder beans from other Latin American producers to suit American tastes. Brazil accounts for 44% of global Arabica production.

“This is not a normal number,” Vinícius Estrela, executive director of the Brazil Specialty Coffee Association, said. “Authorizations usually happen in batches of 20 or 30 companies. Getting 183 at once is a record.”

“The United States imports more than 8 million bags of coffee per year. China consumes nowhere near that,” he said. Even under optimistic projections, he estimated that redirection to the Chinese market might reach only a few hundred thousand bags. He foresaw US consumers still relying on Brazilian supply despite the tariff.

Luckin Coffee, founded in 2017, now operates over 22,000 stores across China, with more than 300 million customers.

In 2024, China was the 14th largest buyer of Brazilian beans, with 55,940 tons, according to Agrostat - the Brazilian agribusiness foreign trade statistics system managed by the federal government. In the first half of this year, Brazilian coffee sales to the Asian country totaled 31,532 tons.

Last week, the Chinese Embassy had already highlighted the growth in net coffee imports between 2020 and 2024. The volume imported increased by 13,080 tons in the period, a 6.53-fold increase. However, per capita coffee consumption in China is still only 16 cups per year, compared to the global average of 240.