The U.S. government is planning to impose import duties of up to 100 percent on products from Nicaragua, including green coffee. This move could seriously undermine the export potential of Nicaragua, one of Latin America’s largest coffee exporters, and create new economic challenges for U.S.-based coffee importers and roasting companies.

The USTR Decision and Legal Grounds

On October 20, 2025, the Office of the United States Trade Representative (USTR) issued an official decision under Section 301 of the “Trade Act,” describing the Nicaraguan government’s policies on labor rights, human rights, and the rule of law as “unjustified and unlawful.” The document states that this situation has negative consequences for U.S. trade and requires a reassessment of existing trade relations with Nicaragua.

The USTR has put forward three main sanction options:

1. The complete suspension of all benefits granted to Nicaragua under the CAFTA-DR (Central America-Dominican Republic Free Trade Agreement);


2. The partial restriction of specific privileges;


3. The imposition of new import tariffs of up to 100%.

The explanatory memorandum notes that these tariffs may take effect immediately or be implemented gradually within 12 months. The tariffs may apply to all goods or only to selected products.

Current Situation and Previous Tariff Policy

Currently, products imported from Nicaragua are already subject to an 18% tariff under the “reciprocal tariffs” program of the Donald Trump administration. This has already contributed to additional price increases in the coffee market. Now, the possibility of a new 100% tariff could further intensify the situation.

The U.S. Trade Representative has announced a public comment period until November 19 regarding this decision. The agency expects official feedback from interested parties, including importers, producers, and roasters.

Reactions from the Coffee Industry

Felipe Gurdián, supply manager at U.S.-based Cooperative Coffees, stated that this decision would “bring the U.S. coffee industry to its knees.” According to him, importers and roasters are already suffering significant losses due to existing tariffs, and new duties would double the cost of raw materials.

Currently, a minimum of 10% tariffs apply to coffee imports worldwide. The U.S., by imposing up to 50% additional taxes on coffee from Brazil, has already created instability in the market. Now, the potential for politically motivated tariffs on imports from Nicaragua and Colombia could cause new fluctuations in the global green coffee market.

According to Gurdián, “U.S. coffee production is not sufficient to meet domestic demand. Therefore, imposing additional taxes on coffee makes no sense for producers, importers, or consumers.” He added, “A 100% tariff on Nicaraguan coffee will only limit the options available to roasters and ultimately hurt the Nicaraguan people.”

Nicaragua’s Economic Dependence and Export Share

The United States is Nicaragua’s largest trading partner and its main coffee importer. The U.S. imports nearly half of all Nicaraguan coffee exports — equivalent to 1.2 million 60-kilogram bags. These figures show that the new tariff decision would deliver a severe blow to Nicaragua’s economy.

Nicaragua’s economy is largely based on agriculture, particularly coffee exports. The implementation of a 100% tariff would not only reduce state revenues but also negatively affect the livelihoods of thousands of small farmers.

Human Rights and Political Reasons

The trade investigation began in December 2024, during the final months of the Joe Biden administration. The prepared 46-page report describes in detail the Nicaraguan government’s pressure on independent labor unions, restrictions on civil liberties, illegal confiscation of property, and other rights violations.

According to the report, the government led by President Daniel Ortega and his wife, Vice President Rosario Murillo, pursues a repressive policy against critics, undermining the confidence of trade partners. The U.S. government believes this policy “contradicts the principles of fair trade and international labor standards.”

Possible Effects on the Global Trade Balance

If the decision goes into effect, trade turnover between Nicaragua and the United States will sharply decline. In addition to coffee, other export categories such as textiles, agricultural products, and tropical fruits could also be affected.

At the same time, the diversification of coffee supply sources in the U.S. market may accelerate. Companies could seek to replace Nicaraguan coffee with beans imported from Honduras, Guatemala, Peru, and Vietnam. However, this might also affect the quality and flavor balance, since Nicaraguan coffee is known for its distinctive aromatic characteristics.

Political Motives and Future Scenarios

The Donald Trump administration has recently intensified its tough trade policy toward Latin American countries. Some of these actions are viewed as instruments of political pressure. It has been noted that Trump has also issued similar tariff threats against Colombia — a move seen as an attempt to reshape U.S. economic influence in the region.

Experts believe that such a step could trigger a new wave of price increases in the global coffee market and raise the cost of a daily cup of coffee for American consumers. Moreover, the imposition of tariffs would drastically reduce the income of Nicaraguan producers and could create social tensions in the agricultural sector.

The U.S. government’s decision could have multifaceted consequences both economically and politically. On one hand, Washington emphasizes its commitment to defending international principles based on human rights and the rule of law. On the other, the decision has the potential to harm the livelihoods of millions of Nicaraguans and affect thousands of American jobs in the coffee industry.

After the public comment period concludes in the coming weeks, the final decision will be announced by the U.S. Trade Representative with the direct approval of President Trump. This move could mark a turning point not only in the relationship between the two countries but also in the future of global coffee trade.

Source:

Daily Coffee News – “U.S. Considers Up to 100% Tariffs on Nicaraguan Imports; Public Comment Sought”

Nick Brown, October 23, 2025

🔗 https://dailycoffeenews.com/2025/10/23/u-s-considers-up-to-100-tariffs-on-nicaraguan-imports-public-comment-sought/