Coffee prices continue to rise, maintaining a tall trend that has lasted two years. Both the Arabian and robust variety have reached historical maximums in international markets, reflecting directly on the cost of the traditional “spout”. Arabica reached a new record of $ 4.07 per pound in the New York market, while the robust has surpassed the 1979 historical values, being negotiated at $ 5,840 per toned in the London market.
The increase in coffee prices can be explained by a combination of factors, writes the. Climate change, crop breaks, and logistics disruptions are meaningfully affecting the industry. According to Business, Brazil and Vietnam, which are the largest producers worldwide, are facing prolonged periods of drought, which has substantially reduced grain supply.
Climate impact on the harvests
Extreme weather conditions have been a major cause of reduction in coffee production. The impact of drought is particularly severe in coffee producing regions, where the lack of water compromises the quality and amount of harvests. The climate has been unpredictable and has made the work of farmers difficult, resulting in a more restricted coffee offer and, consequently, higher prices.
In addition to adverse weather conditions, logistics disruptions have also contributed to increased prices. Coffee transport has been affected by various obstacles, such as container shortages and the increase in international transportation costs. On the other hand, the new regulations of the European Union, which impose more rigorous norms on the production and trade of agricultural products, are aggravating uncertainty in the market.
Commercial tensions also play an important role in this price climbing. The commercial dispute between the US and Colombia, another major coffee producer, has generated an environment of instability in the market. In addition, Brazil, due to its enormous production, has also been affected by these commercial disputes, which affect the flow of coffee between countries.
Increased coffee prices are already affecting roans and consumers. Rooks face higher costs to purchase coffee, which directly impacts the final price for the consumer. For coffee lovers, this increase has been felt in the price of “spout”, which has become more expensive in many places, reflecting the increase in international prices.
The discharge trend of coffee prices does not seem to end. Arabica’s future contract rose 27% since the beginning of the year, while the robusta valued 14%. This climb is continuing with the strong high movement in 2024, when prices had already begun to rise sharply.
Behavior of producers
Many coffee producers are holding their production, waiting to enjoy the appreciation of the grain. This behavior further contributes to inflation in the sector as supply remains restricted while prices continue to rise. Some producers choose to store coffee, believing that the high prices can continue and that it will be more advantageous to sell it later.
Expectations for the future
Prospects for the coffee market remain uncertain. Despite constant demand and increased consumption in various markets, production faces significant challenges. Pressure over prices should continue while climatic, logistics and commercial factors are not resolved. Experts warn that the situation can continue to affect coffee prices in the medium and long term.
Increasing coffee prices has a true global economic impact, as it is one of the most negotiated agricultural products in the world and its appreciation affects not only consumers but also the economies of producing countries. Pricing escalation can represent an opportunity for some, but also a challenge for consumers and dependent industries of this essential good.
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