Coffee Know-how

Green Coffee Market

Skyrocketing green coffee prices

Coffee prices have exploded in recent months. This applies to both important varieties, Arabica and Robusta.

The exchange for Arabica coffee futures contracts in New York traded above 400 US cents per pound for the first time ever in February 2025, increasing the price of the raw product by an average factor of 3 compared to 2021.

The trading price of the Robusta variety rose by 66% within a year - the highest level in 29 years.

 

While many coffee roasters have taken the higher purchase prices in recent months in their stride and refrained from increasing the prices of their roasted coffees in the expectation of early relief on the stock market, the current very high cost of goods is hitting them hard. Depending on the blend composition, cost-covering production at the previous roasted coffee sales prices is no longer possible.

Both coffee roasters and retailers around the world have announced or already implemented price adjustments.

Arabica price trend over the last 10 years

Robusta price trend over the last 10 years

Climatic changes

The effects of climate change are clearly noticeable in coffee production. Warmer temperatures would actually be an advantage for coffee cultivation, but extreme weather events such as drought or heavy rainfall are becoming more frequent. The drought in Brazil and flooding in Vietnam have led to crop failures in the most important coffee-growing regions. This has reduced the availability of high-quality coffee and driven up prices.

Brazil (40% of global coffee cultivation) and Vietnam (16% of global coffee cultivation) together account for more than half of global cultivation.

In many coffee-growing regions in Brazil, the weather from September to November 2024 was too hot and too dry. Expectations for the 2025 harvest, which begins in May 2025, therefore had to be revised downwards. This in turn caused prices to skyrocket.

However, coffee prices on the stock exchanges had already risen long before the negative news from Brazil, because annual consumption was always slightly higher than production and global green coffee reserves were therefore declining.

Coffee plant with drought damage

Global demand

Global coffee consumption continues to rise, particularly in emerging markets such as South America, India and China. The younger and traveled generation likes to drink coffee. This increased demand meets with limited supply, which leads to a further price increase.

Empty warehouses in the ports of the consumer countries are forcing people to buy directly in the producer countries. The price there is driven up. Many exporting countries are now better financed than in the past and are therefore not forced to bring their new harvests onto the market immediately. This also creates further pressure on sales prices.


Branch of the coffee shop chain “Lukin Coffee” in Shanghai China

Economic and political uncertainties

Geopolitical tensions (Ukraine war, Middle East conflict, threat of trade tariffs, etc.) and economic uncertainties have also contributed to the volatility of coffee prices. 

Although the new EUDR law (EU Deforestation Regulation) has been postponed by one year to 2026, it poses a major challenge for exporters at origin and importers/coffee roasters worldwide and is leading to uncertainty.

With regard to the import of organic products, the EU has also set new, very strict regulations for cultivation and import controls for 2026. It is assumed that the cultivation of organic coffee will therefore decline, all the more so now that the market price for non-certified coffees is also very high.

Since the pandemic, there has been an imbalance in the distribution of transport containers worldwide. Many shipments can therefore only be booked at very high prices and are often very late. Very few container ships still travel through the Suez Canal and have to take the much longer and therefore more expensive route under the Cape in South Africa.

We at Blaser Trading are doing everything we can to support and advise you in these challenging times. Get in touch with us.