Coffee prices skyrocket as demand increases and Brazil suffers drought
Supply chain delays are also affecting coffee prices in Vietnam and Colombia
Coffee is getting more expensive, according to a recent report.
A drought in Brazil coupled with an increase in demand for coffee as the world reopens after the coronavirus pandemic has led to higher coffee prices, according to a report from The Wall Street Journal.
The newspaper reported that the price of arabica coffee beans, which is Brazil’s main coffee variety, hit its highest level since 2016 last month, as the country’s coffee harvest is expected to drop dramatically this year because of the drought.
POPEYES SPARKS MEMORIES OF ‘CHICKEN WARS’ WITH NEW MENU ITEM
"I’ve been growing coffee more than 50 years, and I’ve never seen as bad a drought as the one last year and this year," Christina Valle, a coffee grower in Minas Gerais, Brazil, told The Journal. "I normally take three months to harvest my coffee; this year it took me a month."
According to the U.S. Department of Agriculture, coffee consumption globally is expected to outpace production. According to the department, 164.8 million bags of coffee are expected to be produced this year, while consumption is expected to reach 165 million bags this year.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Supply chain delays are also affecting coffee prices, The Journal reported.
According to the newspaper, antigovernment protesters blocked highways and ports in Colombia, making it difficult for the country to export its beans. Meanwhile, The Journal reported that Vietnamese coffee farmers suffered from a shortage of shipping containers.
CLICK HERE TO READ MORE ON FOX BUSINESS
The Journal reported that although coffee roasters haven’t yet raised prices for consumers, they could start doing so soon if demand increases enough as the economy recovers from the pandemic.
There is also the hope that Brazil could see more rain in September, which could help the country’s coffee farms recover and produce enough coffee for next year.