Laos is considering diverting its coffee exports from the US to Russia due to the heavy tariffs imposed by US President Donald Trump. According to Laotian Prime Minister Sonexay Siphandone, the country may increase its coffee supplies to Russia if the US tariffs make their products too expensive for American buyers. Siphandone stated that among the goods Laos supplies to the US, but can also supply to other countries, are agricultural products such as coffee.

The US tariffs, which were imposed last month, include levies of 40% on goods from Laos. This move is part of a broader effort by the Trump administration to address perceived unfair trade imbalances. The tariffs have also affected other major coffee exporters, including Brazil and Vietnam, with levies of 50% and 20%, respectively. Brazil, the world’s largest coffee producer, accounts for 37% of global output, while Vietnam contributes 17%.

The tariffs have contributed to a recent spike in coffee prices, which have also been affected by poor weather damaging harvests and market disruption. The International Coffee Organization has reported that coffee prices have increased sharply in recent months. In the US, coffee is a highly consumed beverage, with two out of three Americans drinking it daily, according to the US National Coffee Association. The association had lobbied for an exemption for coffee ahead of the Trump tariffs, but so far, their efforts have been unsuccessful.

The potential diversion of Laos’ coffee exports to Russia could have significant implications for the global coffee market. With the US being a major consumer of coffee, the tariffs could lead to a shift in the market, with other countries such as Russia potentially benefiting from increased supplies. The situation highlights the ongoing impact of trade tensions on global markets and the potential for countries to seek alternative trade partners in response to tariffs and other trade restrictions.