Record-breaking Coffee Prices Causing Global Coffee Traders To Reduce Purchases – CoffeeTalk

Global coffee traders and roasters are reducing purchases due to the record rise in arabica bean prices, which have increased by 70% over the past year. This has caused problems in the industry and led to product shortages on supermarket shelves. The 70% increase in arabica coffee futures on the ICE exchange has shocked participants at the annual meeting of the National Coffee Association of the USA in Houston.

ElcaFE CA CEO Renan Chueiri stated that this year the instant coffee producer has not sold the expected annual production volume by March for the first time, selling less than 30% of the product. The significant price increase is eating into customers’ cash flow, as they don’t have the money to buy what they need.

The rise in coffee prices is due to a decrease in production in key coffee-growing regions, especially in Brazil, which is the leading producer, leading to reduced bean availability. According to a recent Reuters survey, arabica coffee prices could fall by 30% by the end of the year, as high prices are dampening demand.

Until prices significantly drop, much of the coffee industry may face serious problems. The CEO of a large coffee roasting company in the USA stated that some of his clients are unsure if they will be able to continue doing business. Negotiations took a long time, and some retail stores began to feel a coffee shortage on the shelves.

Commodity trader Louis Dreyfus stated that coffee planting areas are expanding in response to high prices, with countries such as India, Uganda, Ethiopia, and Brazil experiencing expansion.

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