Coffee bean prices have reached their highest level in nearly half a century, primarily due to unfavorable weather conditions and supply chain issues. This surge means that coffee in all forms — from arabica-based drinks to robusta-based instant coffee — is almost certain to become more expensive for consumers. Yes, your cappuccino on the Stradun could now cost even more.
On Wednesday, the global benchmark price for arabica rose by 4.6%, reaching $3.2305 per pound, the highest level since 1977, according to Business Insider. Since the beginning of the year, futures contracts for arabica have surged by more than 70%, reports tportal.hr
At the same time, the benchmark price for robusta — a cheaper alternative to arabica — increased by 6.9%, hitting $5,533 per ton. Robusta prices have climbed 80% this year. The world’s largest coffee producer, Nestlé, announced last week that it will raise prices to offset rising raw material costs.
Brazil, which accounts for nearly half of the world’s arabica bean production, is facing serious challenges. Farmers are hesitant to sell their stockpiles, anticipating even higher prices after already selling about 70% of the current crop, according to Reuters.
Brazil experienced its worst drought in 70 years in August and September, raising concerns about the next harvest. While heavy rainfall later helped trees bloom, experts are worried about whether the blossoms will properly develop into fruits containing coffee beans.
While some consumers are switching to cheaper robusta, prices for this coffee variety are also rising. In Vietnam, the largest robusta producer, heavy rains following earlier droughts have complicated the situation. The current harvest is taking place after three years of supply shortages.
Local reports indicate that Vietnamese farmers are also demanding higher prices, following the example of their Brazilian counterparts. Similar issues are present in other major producers, such as Colombia and Honduras, which are also grappling with extreme weather conditions.
