5 Reasons Why Coffee Prices Are Going Crazy

What is happening with the Arabica and Robusta coffee market? In the last few months, the coffee industry has experienced various situations that have created the precondition for quite volatile prices, including in the speciality coffee sector.

In the following lines, we will present you some basic reasons that made the prices of Arabica and Robusta coffee on the stock market go up and down.

Fact 1: The frost in Brazil

It is no secret that Brazil is the largest exporter of Arabica coffee beans worldwide. And as such, it directly affects market prices based on its harvest. Unfortunately, the freezing, seriously affected the quality and quantities of all products, as well as supply, raising the prices of coffee beans Arabica.

Fact 2: Excessive rainfall in Colombia

Rain is one of the main factors in the production of green coffee, but when its amounts are too high, it becomes a problem, but why? 

Because when coffee trees get more water than they need, there is an increased risk of plant diseases, and what’s the problem with that? 

The problem is that the yield is decreasing, which affects the quantities of coffee offered on the Arabica market, which also affects the prices of roasted coffee beans.

Fact 3: Lack of container delivery in Vietnam

Due to the pandemic situation, the Vietnamese green coffee industry, one of the world’s leading Robusta coffees, is struggling to deliver its products to the world market, as there is more demand for containers than available. 

In addition, the lack of manpower due to the high cases of COVID 19 also has a negative impact on the situation.

Fact 4: Ethiopian Civil War

The conflict erupted in the Tigre region about a year ago, when the prime minister decided to launch a campaign against the Tigre People’s Liberation Front, a local terrorist group. 

The side effects of this conflict soon led to a reduction in the supply of coffee beans from Ethiopia.

Fact 5: Increase delivery costs

As everyone knows, the pandemic situation has created many problems. 

One of which is the price of transport, which is an important and indispensable part of the coffee path, changing its stock market values. 

And here’s an example to give us a clearer picture of what has been said so far:

Handling a container before the pandemic cost an average of $ 2,500, and now it’s about $ 15,000.

In addition, transport and fuels have increased by between 300% and 500% in the last almost two years.

The participants in the so-called coffee path chain are facing the consequences of all these facts.

Green coffee producers, importers, transport companies, coffee bakeries, restaurants, shops and cafes, all of them.