Multiple coffee chains across the United States have filed for bankruptcy in the US in recent weeks as the sector grapples with soaring prices.
Inflation has resulted in a steep hike in coffee prices in the US, with a key consumer price index for coffee products showing a 19% year-over-year increase as of September 2025, Economic Times reported.
What is to blame?
Since the US doesn’t grow coffee domestically, it is heavily reliant on imports from Brazil, Colombia, and Vietnam – countries facing moderate tariffs from US President Donald Trump’s administration.
High labour costs, supply chain issues, and changing customer habits have also posed a problem to the coffee crisis, multiple reports claimed.
A look at the coffee chains affected
The Blend Coffee and Cocktails, which operates in eight locations in Florida, has filed for Chapter 11 bankruptcy protection, while the parent company of Cuppa Austin Coffee Shop also filed for Chapter 11 protection in October.
‘Red Bay Coffee’ in Bay Area, ‘Switchback Coffee Roasters’ and ‘Ink! Coffee’ in Colorado are also among those affected, Business Insider reported.
Companies like Compass Coffee, which operates in a number of locations across the Mid-Atlantic region, has also issued a warning that it could soon head the same way.
Starbucks not spared either
Popular coffee chain Starbucks is itself in the midst of a restructuring plan that involves cutting down staff and shutting down several underperforming stores to address what it calls ‘operational inefficiencies’.
Its CEO Brian Niccol had also warned of the impacts of tariffs and inflation on its operations, saying that cash-strapped consumers were becoming more “choiceful with where they choose to spend their dollars,” Newsweek reported.
So, what happens next?
Last month, Democratic Senator Catherine Cortez Masto and Kentucky Republican Rand Paul introduced the ‘No Coffee Tax Act’ to curb the ongoing crisis, which aims to repeal Trump’s tariffs on coffee and lower costs for consumers.
“The US doesn’t grow coffee and taxing it won’t create a single American job…What it will do is raise prices for families and small businesses because the president is using an emergency declaration as an excuse to raise taxes,” Paul had earlier said.
