By Konrad Putzier
Sharp price increases in coffee, beef and bananas over the past year have fueled widespread frustration with the rising cost of living. The Trump administration's plans to walk back some tariffs on these goods could ease the pressure, economists say.
Average retail prices for ground roast coffee are up more than 40% in the past year as of September, according to the Bureau of Labor Statistics. Average retail prices for ground beef and bananas have increased by 11.5% and 8.6% since September 2024 -- well ahead of the overall inflation rate of about 3%.
On Thursday, a Trump administration official told reporters that the White House plans to eliminate tariffs on coffee, beef, bananas and some textiles and apparel from four Latin American countries: Argentina, Ecuador, El Salvador and Guatemala.
Grocery-price inflation has been a particular burden for low- and middle-income Americans, who tend to spend a bigger share of their income on food. Anger over high prices contributed to Republican defeats in this month's gubernatorial elections in New Jersey and Virginia.
The U.S. imports most of its coffee and bananas. Importers and wholesalers work with slim margins, meaning they face more pressure to pass tariff costs on to their customers, said Bill Adams, chief economist at Comerica Bank. And because bananas go bad quickly, companies are generally unable to build up large inventories ahead of tariffs the way some did with electronics or furniture. Coffee and banana prices are also sensitive to bad weather, said Troy Ludtka, senior U.S. economist at SMBC Nikko Securities.
The surge in beef prices wasn't primarily caused by tariffs, economists say. The U.S. is a major beef producer, but cattle herds have been shrinking for years, partly because of drought, pushing up prices. Imports from abroad help make up the shortfall, but tariffs make those more expensive. Brazil, one of the biggest sources of both imported beef and coffee in the U.S., faces a 50% tariff.
Economists say lifting import duties will help bring prices down, but much will depend on how many countries are ultimately included. Either way, companies often take a while to lower prices even when their own costs fall. "Often prices take the elevator up and the stairs down," said Comerica's Adams.
Write to Konrad Putzier at konrad.putzier@wsj.com
(END) Dow Jones Newswires
November 14, 2025 14:51 ET (19:51 GMT)
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