Coffee prices at Tim Hortons set to increase due to U.S. tariffs_ expert

I UPLOAD LATEST NEWS AND WETHER INFORMATION  Coffee prices at Tim Hortons set to increase due to U.S. tariffs_ expert

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00:00Canada's iconic coffee chain Tim Hortons is charging more for a cup, reflecting a wider trend of rising coffee prices.

00:08The price of coffee beans has more than doubled over the last three years, according to a Tim Hortons spokesperson.

00:14This is related to U.S. tariffs, as Canada imported 3.9 million kilograms of roasted coffee in July, with most coming from the U.S.

00:24Joining us now is Sylvain Charlebois, Senior Director at Agri-Foods Analytics Lab.

00:30Sylvain, thanks for being here.

00:32Good morning, Renée.

00:33So can you break down this rise in coffee prices for us?

00:38We were expecting this for a while now.

00:41In fact, if you look at coffee prices, they've been up since April.

00:45It's now at $3.85 a pound U.S., which is almost double of the five-year average.

00:56And that's due to the fact that in Brazil, they've been challenged by inclement weather.

01:03Because of La Nina, they're expecting more dry weather over the next several months, and that's going to impact production.

01:11And that's probably why chains are, you know, moving ahead and increasing prices.

01:17We saw that in retail.

01:19A lot of people have noticed higher prices at retail.

01:22But it's catching up to food service.

01:24So we're expecting more chains to do the same thing as Tim Hortons has.

01:29To what extent are tariffs coming into play?

01:33Well, actually, as of September 1st, there are no counter tariffs for coffee coming into Canada.

01:41So that certainly is good news.

01:43So we are expecting in retail to see coffee prices drop as a result within the next couple of weeks.

01:49But in food service, we haven't seen any increases.

01:52So it was just a matter of time.

01:53The problem are U.S. tariffs.

01:56The Americans are applying tariffs on Brazilian coffee beans.

02:01It's coffee beans coming from all over the world.

02:04And so whenever we actually import coffee beans from the United States, because they're packaged, they're processed there,

02:11we're paying for that tariff indirectly whenever it goes to the U.S.

02:16So it's certainly pushing coffee prices generally higher across the globe as a result.

02:22Meantime, Loblaw is reporting food prices are rising faster than the Consumer Price Index.

02:28Where are we seeing the increase?

02:31Well, that was August and September.

02:34I think October provides us with a different scenario.

02:39I do believe that prices are way more stable than just a few months ago due to the fact that counter tariffs are now gone since September 1st.

02:50So we are expecting the CPI to actually drop a little bit more for the month of October, which is certainly good news for everyone.

02:57I was just thinking that's some nice news for a Sunday morning.

03:00That's right. Exactly. Except for the fact that coffee will be more expensive at your favorite restaurant, unfortunately.

03:06Yes, yes. There's always a catch.

03:09All right, Sylvain, thank you very much for being here. Great chatting with you.

03:12All right. Take care.

03:13That's Sylvain Charlebrois, Senior Director at Agri-Food Analytics Lab.