The commodities market is chaos right now. Yesterday, for the first time in its history, the price of coffee futures on the C market broke the $4 per pound mark, closing at $4 on the dot. For the past few months, the price had been flirting with the previous record of $3.39 set back in April of 1977, a mark it finally broke past near the end of January.
It is here that I would once again like to point out that, adjusted for inflation, the 1977 high is more like $17 in 2025 dollars and we are nowhere near that. But still, in the short term it’s an astonishing rebound; we’re not but five years removed from the price dipping below—and staying below—$1. It’s over double the price from the same time last year. The end result is good news for coffee producers around the globe, but as always, the driving factor behind the uptick is the same: uncertainty.
Global stockpiles are dwindling and overall yields at some of the largest producing countries, like Brazil, are decreasing and unable to replenish the supply. Climate change is causing unpredictable weather patterns affecting output and causing prices to fluctuate wildly. And now tariffs—and the threat of tariffs—are being added to the already volatile mixture. The current US president has already levied a 25% tariff on all goods coming out of Colombia, including coffee, that ultimately got revoked in the 11th hour. Still, the threat of sweeping tariffs and the resultant trade war has added instability to the markets.
Which could, as it has in the past, result to traders panic buying in fear that the price will rise even more, a sort of self-fulfilling prophecy that could cause the price to rise higher.
As of now, the chaos in the marketplace is an agent for good, at least as far as it pertains to coffee producers, who have historically gotten the short end of the stick in these matters. (Your uncle railing about the price of a cup of coffee these days may not exactly agree.) But the thing about instability is that it’s not stable. It’s tautological. And market volatility is about a good of a thing as it sounds. No one knows where the price of coffee is headed nor how it will affect the producer as well as the consumer. But at least for now, it’s to the benefit of the most vulnerable on the supply chain.
Zac Cadwalader is the managing editor at Sprudge Media Network and a staff writer based in Dallas. Read more Zac Cadwalader on Sprudge.
