Coffee prices remain high after July surge – BeanScene

ICE Arabica Coffee C Futures remain volatile following the unprecedented surge on 6 July, with the potential to impact coffee prices in Australia.

The rally saw prices jump more than 16 per cent in a single trading session to reach a five-month high and marked one of the largest daily advances seen in decades.

The surge was fuelled by concerns surrounding Brazil’s harvest progress, forecasts for rain across key producing regions, and dwindling ICE-certified inventories, raising concerns around near-term supply.

In the days since, however, the peak has been negated by dropping prices. In the following trading session on 7 July, prices dipped 9.24 per cent. A 12.3 per cent rise followed on 9 June, before drops of 3.92 per cent and 1.12 per cent in the following two days.

By 13 July, ICE Arabica Coffee C Futures prices had fallen well below the peak seen just days before, but still far higher than the June low.

Most green coffee contracts in Australia are priced using the ICE Arabica futures contract as a benchmark, meaning sudden spikes in futures prices can quickly translate into higher replacement costs for importers and roasters.

For Australian businesses already managing rising labour, rent, and energy costs, sharp futures volatility can create additional uncertainty around coffee purchasing and menu pricing.

Although futures have since retreated from their peak, the fact they still remain well above the prices seen in June means many roasters may still face elevated green coffee costs despite the market’s recent correction.