The price of Arabica coffee on the commodities market reached a near 50-year high last week. On Friday, November 29th, Arabica closed at an astounding $3.31 per pound, the highest it has been since 1977. The driver of this record? Uncertainty.
The price fell just eight cents short of the all-time record set in April of 1977 and has since cooled to just below $3.00 per pound. As reported by Semafor, bad weather in Vietnam and Brazil are the leading factors. Brazil, the largest producer of Arabica, experienced “its worst drought in 70 years this year followed by heavy rains,” which leads to fears of a lower output next year. Meanwhile Vietnam, one of the major robusta growers, has experienced similarly low production for three years running, further tightening the supply. Robusta is also experiencing similar record highs.
Along with climate change-based concerns, the recent presidential election is having an impact. The president-elect’s talking points about indiscriminate tariffs have many in the industry over-buying now, concerned that the price for the same coffee once January rolls around will be significantly higher.
Overall, the price of Arabica has risen 72% year-to-date.
And while the uptick is a welcome change—we should be paying more for coffee—even if caused by generally terrible reasons, it is still worth noting that $3.31 today equates to around $.66 per pound in 1977 dollars. Coffee today would have to cost over $17 a pound to equal the $3.39 record from 1977 when taking inflation into consideration. Either way, the trend is positive, despite not being quite as record breaking within context.
Zac Cadwalader is the managing editor at Sprudge Media Network and a staff writer based in Dallas. Read more Zac Cadwalader on Sprudge.
