Coffee Supply Risks Threaten Future Availability Amid Rising Prices and Climate Challenges
Max Milward of the Fairtrade Foundation warns that there is a genuine risk we won’t have coffee in the future due to ongoing supply problems and climate risks. Global arabica coffee prices have surged by more than 20% this year and 70% in 2024, driven largely by adverse weather conditions in Brazil and a drought in Vietnam.
Coffee is one of five staple foods that have contributed to approximately 40% of food inflation in the past year, according to the Energy and Climate Intelligence Unit.
Mexican coffee producer Silvia Herrera reported a 50% drop in production of their highest quality coffee last year. She also noted that farmers earn around 3% of the retail price, with the Fairtrade minimum price providing essential support. The Fairtrade minimum price acts as a price floor; however, due to price volatility and investment challenges, less than 10% of the $200 billion coffee industry remains in producing countries.
In Honduras, coffee cooperatives have begun moving to higher altitudes to escape pests and diseases, but it is estimated that suitable growing areas may be insufficient within 10 years. The Climate Institute projects that about 50% of the land currently used for coffee growing may become unsuitable within 25 years, potentially halving production by 2050.
This situation prompts reliance on roasters and manufacturers to manage cash flow and stock while hoping for a recovery in Brazil's coffee crop.
