Global coffee trading is grinding to a halt. Prices have surged 70% since November, and roasters are cutting back purchases to the bare minimum. Suppliers are struggling to push these soaring costs onto retailers, leaving the industry in chaos.
At the National Coffee Association convention in Houston, industry insiders admitted they’re in survival mode. Some traders aren’t even sure they’ll be in business much longer. Arabica coffee futures on the ICE exchange—the global benchmark—have skyrocketed, draining buyers’ cash flow and slowing deals to a crawl.
Renan Chueiri, director of Ecuador’s ELCAFE C.A., said his company usually sells out by March. This year? Less than 30% of their stock is gone. Buyers simply don’t have the cash to secure their usual shipments.
The culprit is a supply crunch. Brazil, the world’s top producer, is turning out fewer beans than expected. The result? A market where nobody wants to gamble on future prices. Buyers are sticking to “hand-to-mouth” deals—purchasing only what they need and avoiding stockpiling.
One broker described the new reality: Every deal is ultra-conservative. Contracts now come with a seven-day deadline—buyers must pick up the coffee, inspect it, pay on the spot, and haul it off immediately. No delays. No credit. No room for error.
Industry forecasts suggest prices could drop 30% by year’s end. But until that happens, pain is the name of the game. A major U.S. coffee roaster admitted that some of his clients don’t know if they can survive. If retail stores refuse to eat the price hike, businesses could fold.
Supermarkets are already resisting the new costs, dragging negotiations out for months. Some shelves are running low, and retailers won’t budge. “It’s been a nightmare,” the roaster said. If this continues, expect shortages.
The question now isn’t whether coffee prices will drop—it’s whether businesses can survive long enough to see it happen.
Five Fast Facts
- Brazil supplies over a third of the world’s coffee, making it the largest producer by far.
- The U.S. is the world’s biggest coffee market, consuming around 400 million cups daily.
- Arabica beans, known for their smooth flavor, make up about 60% of global coffee production.
- Instant coffee accounts for over 25% of worldwide coffee consumption.
- Coffee futures have been traded on the ICE exchange since 1882.
