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Global coffee prices soar nearly 40% amid climate disruptions
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Wednesday, 19 March, 2025, 16 : 00 PM [IST]
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Rome
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Global coffee prices surged by 38.8 percent in 2024, reaching their highest levels in years due to severe climate conditions disrupting key producing regions, according to a new report by the Food and Agriculture Organization (FAO).
The price of Arabica, a premium coffee variety, rose by 58 percent, while Robusta, mainly used in instant coffee, saw an even sharper increase of 70 percent, significantly narrowing the price gap between the two for the first time since the mid-1990s.
FAO attributes the spike in prices to adverse weather conditions that severely affected coffee output in Brazil, Viet Nam, and Indonesia—three of the world’s largest coffee producers.
- Viet Nam saw a 20 percent drop in coffee production due to prolonged dry weather, leading to a 10 percent decline in exports for the second consecutive year.
- Indonesia suffered a 16.5 percent production decline after excessive rains damaged coffee cherries in 2023, causing exports to plummet by 23 percent.
- Brazil, the world’s top coffee producer, had to revise its 2023/24 production forecast from an expected 5.5 percent growth to a 1.6 percent decline due to hot and dry conditions.
FAO warns that if climate-related disruptions persist, coffee prices could rise further in 2025. Higher shipping costs have also contributed to the increase, affecting consumer prices worldwide. By December 2024, coffee drinkers in the United States were paying 6.6 percent more, while European Union consumers faced a 3.75 percent price hike compared to the previous year.
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FAO emphasises the need for investment in technology, research, and climate-resilient agricultural practices to safeguard coffee production. Boubaker Ben-Belhassen, director of FAO’s markets and trade division, said, “The high prices should provide incentives to invest more in technology and research to increase climate resilience.”
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