Lavazza: Brazil Tariffs Will Push up Coffee Prices
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Yahoo
13 minutes ago
- Yahoo
We Visited a U.S. Outpost of China's Luckin Coffee. Here's What We Saw.
Luckin Coffee, which has thousands of shops in China, recently opened two in New York City. On a recent visit to one, Investopedia found some curious drinkers—as well as someone who had already made the place part of their routine. The Luckin experience is centered largely around the company's app, rather than an attempt to create a coffeeshop Yorkers thirsting for a taste of China's top coffee company are in luck. Luckin Coffee, which has more than 24,000 shops in China, earlier this month opened its first two U.S. cafes in Manhattan. During a Tuesday morning visit to one, near New York University, customers said they were curious about both the company and a storefront they had watched take shape on their commutes. 'I did some research, and I saw, okay, this is the equivalent of Starbucks—the Chinese version,' said Shazia Amin, 52, a Brooklyn resident. 'So I do need to try it.' Luckin went public in the U.S. in 2019. The chain's momentum, however, came to a halt—and it was kicked off the Nasdaq—after an internal investigation determined executives had inflated its finances. Now traded over-the-counter in the U.S., Luckin has regrouped. In addition to its Chinese stores, it has about 65 locations in other Asian countries, according to a company presentation, along with its New York City shops. Roughly a dozen people milled around the shop early Tuesday. The store played jazzy low-fi, but lacked the chatter characteristic of a city cafe: Most customers were focused on their phones, likely because orders must be placed via app. When an order is ready, customers scan a barcode on their phone and pick up items waiting on the counter. The app was a defining feature of Luckin from the get-go. Its founder, Jenny Quian, led a ride-hailing company and set out to apply that model to the coffee industry in 2017, according to The Wharton School at the University of Pennsylvania. With relatively light spending on headcount and real estate, Luckin surpassed Starbucks' footprint in China within two years, Wharton found. Luckin's app initially estimated that it would take six minutes to prepare the coconut latte and blood orange cold brew this reporter ordered. But a text message arrived after four minutes, announcing the beverages were ready. Kalei Gregg, a 21-year-old NYU student, called the cashierless outpost 'definitely different, but I kind of like it. It's fast, convenient.' Gregg, who said she likes Luckin's 'really sweet' matcha tea, was visiting for a fifth straight day. Lawrence Aiello, 36, said he was worried that the app would collect data on him, but downloaded it when he saw that Luckin was offering discounted drinks. Aiello said he liked the 'strong' cold brew, but would probably delete the app. 'I have enough apps on my phone,' he said. Luckin was giving customers their first drink for $1.99, though items typically cost a few dollars more. Prices range from $3.45 for a drip coffee–it was sold out by 10 a.m. when Investopedia visited–to $7.95 for a 'vital kale" drink with fruit and jasmine. The menu includes familiar drinks, such as americanos, lattes, cappuccinos, cold brews, frappes, and a few dessert and breakfast foods. Some of Luckin's most popular beverages, including coconut lattes and drinks with a velvet milk blend, may be new to many Americans. Luckin–and other cafes with relatively low prices–have cut into Starbucks' sales in China, Starbucks executives have said. Luckin had an 8.1% year-over-year increase in same-store sales at company-operated cafes in the quarter ended in late March, the company said. That quarter, Starbucks reported comparable store sales for company-run shops were flat compared to a year prior. Starbucks CEO Brian Niccol has said that improving sales in China is less of a priority than reviving its American business. Starbucks has begun exploring the possibility of selling part of its Chinese business, and received a number of potential offers. Read the original article on Investopedia Sign in to access your portfolio
Business Insider
16 minutes ago
- Business Insider
From rice to digital services, here is what's making trade negotiations difficult for the Trump administration
The 90-day tariff pause did not yield 90 announced trade deals. After giving 75 trading partners a three-month tariff pause and telling Time in an April interview that he "100%" has "made 200 deals," President Donald Trump came away with three trade deals, some tentative, as of mid-July. Months of negotiations with Japan, Korea, and Thailand have not yielded agreements. As Trump sends out a new round of tariff letters to over 20 countries, threatening some with tariffs as high as 50%, trade experts told Business Insider that many sticking points stand in the way of quick trade deals. Navin Girishankar, president of the Economic Security and Technology Department at the Center for Strategic and International Studies, told Business Insider that the Trump administration believes that unpredictability and ratcheting up tariffs give them leverage, but it remains questionable if that is effective. "I'm actually feeling that it's more and more the loss of leverage," said Girishankar. "Because the reason we're shifting timetables is because we're not able to get to the deals that we think are acceptable." Domestic politics throw a wrench in negotiations Multiple trading partners that Trump is negotiating with are dealing with elections and policies that are popular in their respective countries. Girishankar told BI that, for example, Korea has a draft of a digital platform bill that its legislators see as important to national security. But the issue is, Girishankar says, the bill would be considered a barrier to entry for US tech companies like Meta and Google if it passes. Trump has also been complaining on social media that Japan won't import rice from the US, while the US imports a large number of cars from the Asian country. Drew DeLong, lead in geopolitical dynamics practice at Kearney, a global strategy and management consulting firm, told BI that Japan has been under a lot of domestic pressure because it has an upper house election in late July. "Once that's finished," said DeLong, "It will be important to watch how PM Ishiba handles the Trump relationship with less domestic political pressure." Despite representing a relatively small part of the national GDP, the agriculture sector in Japan has cooperatives with significant lobbying power that have gained protectionist measures on staple crops like rice. "Agriculture has historically been a very challenging component of any trade agreement. Farmers are an important constituency in both countries," Girishankar added of the US and Japan. Ann Harrison, dean of the University of California, Berkeley's Haas School of Business, told BI that the Trump administration may have simply set itself up for "a herculean task." "Different countries have different sensitivities, like how it's the auto industry for Japan, and lumber and pharmaceuticals for Canada," said Harrison. "That's why any meaningful trade deals typically take three years and won't happen in such a short period of time." China complicates trade deals Though the tariff pause on China doesn't expire till mid-August, the manufacturing hub casts a long shadow. Harrison said the Trump administration needs to balance its need to reduce the trade deficit, without going so far that it would push Asian allies like Vietnam and the Philippines toward a closer alliance with China. "It's politically interesting that the US gave Vietnam and the Philippines some of the lower tariffs," said Harrison. "This is also becoming a militarily loaded decision as much as an economic one." In March, Defense Secretary Pete Hegseth met with Philippine President Ferdinand Marcos Jr. and said the two countries, which have been fighting "shoulder-to-shoulder" since World War II, will work toward "reestablishing military deterrence" in the Indo-Pacific region. DeLong also said that the transshipment issue — one country rerouting its goods through another country, potentially to evade higher tariffs — has also made a comeback in the agreement with Vietnam, mostly due to concerns that China would reroute shipments to the US through Southeast Asia. "Still unclear how this will work mechanically," said DeLong. "Higher RVC thresholds? Port of shipment tracking? Headquarters country of origin?" According to statistics from the General Administration of Customs in China, the total value of China's exports to Vietnam increased by at least 15% every month in 2025 compared to the same months in the previous year. Girishankar echoed the concerned that transshipment would be complicated to implement and define, though he understands what the administration is attempting to achieve. "Some countries are worried that literally any Chinese content can be considered a transshipment," said Girishankar. "Bilateral negotiations with countries are also being used as the main way of achieving a global rebalancing of trade deficits, which is really challenging."
Business Insider
23 minutes ago
- Business Insider
Here's the stock-market playbook for the August 1 tariff deadline
Investors waited anxiously for the July 9 tariff deadline only to be met with a new date of August 1, and while the window for negotiations has been pushed out, tariffs are likely still coming. President Donald Trump committed to the new date this week, stating that no new extensions would be granted. His updates included a barrage of tariff letters to more than 20 countries, with threats of 25% tariffs on Japan and South Korea, 50% on Brazil, and 35% on Canada. Even as investors hope that the TACO trade will save them again, market pros told Business Insider this week that there are ways to position for the coming deadline. Here's what they're bullish and bearish on as the market barrels toward the August 1 "T-Day." Bullish Tariffs are aimed at benefiting companies that manufacture in the US. While it's not certain to what extent factory jobs will return, there are some existing domestic industries with positive exposure to the trade war. Trump's 50% tariff on all copper imports announced this week, for instance, should point investors toward some specific areas of the market. Henry Yoshida, CEO of Rocket Dollar, told Business Insider that he sees positive tailwinds for US copper producers, specifically Freeport-McMoRan and Souther Copper Corporation, two companies recently named by Morgan Stanley as likely winners. "These companies, which specialize in copper, would benefit from increased pricing power as tariffs would make copper imports more expensive," he stated. Apart from Copper, Yoshida added that he sees growth ahead for tech companies that build semiconductors in the US. That industry is also set to benefit from the recently passed One Big Beautiful Bill Act, which includes a valuable tax credit for chipmakers. "Chipmakers that predominantly have US-based manufacturing, such as Texas Instruments and Intel, could see upside gains as tariffs may shift demand to domestic suppliers." Julia Khandoshko, CEO of financial planning firm Mind Money, issued a similar perspective. "In the short term," she said, "semiconductor companies like Intel and Nvidia could come out ahead, since the US will likely push harder for domestic chip production." Bearish Mark Malek, Chief Investment Officer at Siebert Financial, recently said that while much remains uncertain about tariffs, some sectors are particularly exposed to risks from the trade war. "From a sector perspective, the most exposed are Consumer Discretionary and Technology, which are sectors deeply reliant on global manufacturing. Further downstream, mass retailers, which depend heavily on low-cost imports, face pricing challenges and potential margin compression." Other experts see high exposure to China as dangerous for companies, particularly as the top US trade partner has promised to retaliate if Trump takes further action against it. From Yoshida's perspective, scaling back on big tech investments makes the most sense. However, he took a different stance on Nvidia than Khandoshko, citing its high exposure to the Chinese supply chain. Along with Apple and Qualcomm, he named Nvidia as a stock investors should consider selling before August 1. He added, though, that he also sees both Tesla and General Motors as being highly vulnerable to the tariff impact, signaling a potential blow to the broader auto market. "GM sells more cars in China than in the US, and both companies rely heavily on China-based production facilities and parts sourcing," he stated. "In retail, Nike faces particular vulnerability, with over 40% of its manufacturing occurring in China." Tom Bruni, Editor-in-Chief and VP of Community of Stocktwits, expressed a similar take, highlighting the risk for companies with heavy dependence on global supply chains, specifically strong links to China. "Apple's heavy manufacturing presence in China, Tesla's reliance on Chinese battery cells/materials, and Walmart 's importing large volumes from affected countries are three of the most prominent examples of companies caught in the crosshairs," he said. Bruni added that in his view, Apple is the bellwether for how the rest of the market reacts to tariff-driven China trade disruptions. "[Apple] has by far the most manufacturing risk," he stated. "How leadership navigates these tariffs and the overall geopolitical environment will set the tone for the rest of the market."
