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The Freezing of USAID is an Abject Disaster for the Global Coffee Sector

| February 5, 2025

USAID website

A screenshot from the USAID website on Wednesday, Feb. 5.

The phrase “political instability” is commonly cited as a threat to sustainability in coffee. Among organizations and analysts in the Global North, the phrase is most often applied to coffee-producing countries.

Yet in recent days, political instability has shaken the global coffee industry — this time, from the U.S. government’s own executive branch.

In the three tumultuous weeks of Donald Trump’s presidential administration — during which time, incidentally, commodity prices for coffee reached all-time highs — the coffee market has experienced a series of separate volatility-inducing blows, including Trump’s tariff threats to Colombia, and the looming trade wars with Mexico, Canada and China.

Yet the most damaging blow may be the sudden and chaotic dismantling of USAID, the primary international relief agency of the United States that has contributed tens of millions of dollars to the global coffee sector over the past three decades.

USAID

Public domain photo.

With a directive to promote American democracy while promoting trade, decreasing poverty and addressing food security, among other noble ambitions, the federal agency has provided key financial backing for dozens of projects affecting the coffee industry, working with foreign governments as well as implementing partners in the private and nonprofit sectors.

Those organizations, and the thousands of people within them, were immediately left in the lurch when the Trump administration ordered a freeze on international foreign aid. Now we know that all USAID staffers were put on administrative leave last Friday, asked to stay home while the paperwork for their dismissals is ironed out.

DCN has attempted to reach former USAID staff members who have been involved with coffee-focused projects or disaster relief services to coffee-producing communities, with none yet willing to go on the record.

Meanwhile, the diplomatic and social implications of USAID’s abrupt exit from the international coffee industry are impossible to quantify. But we can look at some recent numbers from recent years:

The list goes on. Nearly all of these projects — addressing poverty, food security, agricultural research, trade development and global health — are now in limbo following the USAID freeze. By USAID’s own count, the organization’s work in recent years has spanned 19 coffee-producing countries.

Notably, the coffee sector represented just a fraction of USAID’s overall investment budget, and the USAID total budget is less than 1% of the federal budget.

Yet this is more than just charity. A recent economic analysis on the impact of USAID-funded agricultural development projects between 1978 and 2018 found that for every $1 spent, the resulting economic impact was $8. In his team’s analysis, Kansas State University agricultural economist Timothy Dalton found that $1.24 billion in USAID investments over those 40 years resulted in $10 billion in economic impact, primarily in low-income, developing countries.

In plain terms, these were investments not only in goodwill and local agricultural systems, but in more financially stable export markets for the United States.

Freezing these funds is likely to have outsize effects in the coffee industry, where private investment in research, people and the planet is already dangerously scarce.

Comments? Questions? News to share? Contact DCN’s editors here. For all the latest coffee industry news, subscribe to the DCN newsletter. 


Nick Brown is the editor of Daily Coffee News by Roast Magazine.

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