Weekly Coffee News: On the Q Takeover + Market Reactions to Tariffs

The Specialty Coffee Association took over the Q program from the Coffee Quality Institute, pitting competing views on how to standardize coffee evaluation and potentially affecting sourcing and consumer outcomes. A 50% U.S. tariff on Brazilian goods has altered market dynamics, with arabica prices rising overall while prices for Brazilian exports fell as exporters lower prices to maintain market access and importers face margin pressure and renegotiation. Coca-Cola is exploring a sale of Costa Coffee, which it bought for $5.1 billion in 2018, with offers expected in early autumn. Keurig Dr Pepper’s $18 billion acquisition of JDE Peet's creates a new Global Coffee Co. led by Sudhanshu Priyadarshi.

Slate's N.C. Stevens cited several coffee professionals for the piece, which questioned how professional coffee evaluation may ultimately affect consumers. Stevens wrote: "The core issue at stake here, beyond the lack of transparency, is that the two organizations have competing views on how to standardize the evaluation of coffee. And this, ultimately, is what consumers should care about, because this drama in the geeky world of specialty coffee affects how coffee is sourced."

The piece suggests arabica prices have risen overall, while prices for Brazilian goods have diminished. "This is a typical phenomenon in international trade when tariffs are imposed," the piece states. "The exporter usually takes the hit in the short term and lowers prices to avoid being shut out of the market. The importer, for its part, may see its margins reduced and try to renegotiate prices and contracts."

Coca-Cola is exploring options to sell UK coffee chain Costa Coffee, with offers expected early autumn, according to a Reuters report. Coca-Cola acquired Costa Coffee for $5.1 billion in 2018. Following Keurig Dr Pepper's $18 billion acquisition of JDE Peet's announced this week, Sudhanshu Priyadarshi will lead the newly formed Global Coffee Co. Fortune highlighted the forthcoming CEO and his recent career, including 14 years at PepsiCo.

Read at Daily Coffee News by Roast Magazine