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MILAN – Kraft Heinz, owner of Maxwell House, one of the most popular coffee brands in the United States, has asked its green coffee suppliers for a 60 days’ notice before hiking prices due to tariffs introduced by the new US administration, reports Reuters, citing a document it has seen.
According to the document, which was reportedly sent last month, the food maker is asking suppliers to only raise prices if the tariffs are permanent and to immediately reverse the increases if the tariffs are lifted, underlining the difficulties faced by U.S, companies in the face of President Trump’s erratic trade policies.
The document denies the argument that large competitors with greater bargaining power could negotiate better deals from their suppliers to help offset tariffs.
The company also said in the document it hoped suppliers would work with it to “mitigate the impact” of tariffs, says Reuters.
The Green Coffee Association (GCA) contract, which governs most coffee shipments to the U.S., stipulates that tariff costs imposed at the market of destination “shall be borne by the buyer.”
Major roasters agreed prices for their green coffee supplies several months ago, when they signed purchase contracts with suppliers who source raw beans from tropical regions.
Kraft Heinz ‘s coffee business, which includes the premium Gevalia brand, had net sales of $835 million in the year ended 28 December, about 3% of company’s total sales.
