Expana’s Coffee and Cocoa expert, Sammy Rolls, runs through the most frequently asked questions surrounding coffee commodity markets to give some clarity around this key agrifood industry.
How is coffee priced in the global market?
Coffee is priced using global futures benchmarks: ICE Arabica in New York (US cents/lb) and ICE Robusta in London (US$/tonne), with physical premiums and discounts reflecting origin, quality, certification, logistics, and local supply-demand conditions. Domestic prices in producing countries generally follow export and futures market trends, adjusted for local market fundamentals and currency movements.
Why are coffee prices increasing recently?
Coffee prices have been increasing recently due to weather-related production concerns in key origins, tight global supplies, strong demand, and ongoing logistical and currency pressures. El Niño can exacerbate these trends by bringing hotter, drier conditions or excessive rainfall to producing regions, reducing yields and quality, tightening supply, and supporting higher prices.
What factors influence coffee prices today?
Coffee prices are influenced by weather, crop production, inventories, global demand, exchange rates, fertiliser and input costs, freight rates, trade policies and tariffs, geopolitical developments, and speculative activity in futures markets.
Who are the main global players in the coffee trade industry?
The main global players in the coffee trade include producers (smallholder farmers, estates, cooperatives), exporters (Cooxupé, Olam Food Ingredients, ECOM), traders (Louis Dreyfus Company, Volcafe, Neumann Kaffee Gruppe), roasters (Nestlé, JDE Peet’s, Starbucks), importers, retailers, and commodity exchanges (ICE New York, ICE London).
Which countries are the main producers within the Coffee Belt?
The largest coffee producers within the Coffee Belt are Brazil (~35% of global production), Vietnam (~17%), Colombia (~8%), Indonesia (~7%), Ethiopia (~6%), Uganda (~4%), India (~3%), Honduras (~3%), and Peru (~2%). Together, the top 10 producing countries account for around 87% of global coffee production. (data source: USDA)
Can I compare prices of coffee from different regions?
Regional prices can be compared, although differences in quality, origin, certification, logistics, and market structure should be considered when making comparisons.
How different are robusta and arabica coffee markets?
Arabica and robusta markets differ in production regions, flavour profile, end use, supply dynamics, and pricing. In recent years, as arabica prices have increased, many roasters have substituted a greater share of robusta into blends, strengthening robusta demand and narrowing the arabica–robusta price spread.
Where can I find reliable information about intercontinental coffee markets?
Expana! Look out for our weekly commentaries, monthly insights reports and breaking news analysis pieces, written by Ryan Gallagher, Oliver Broster and I.
Where is coffee traded?
Coffee is traded on futures exchanges, including ICE New York (Arabica) and ICE London (Robusta), where standardized contracts are bought and sold for future delivery and serve as global price benchmarks. Coffee is also traded through physical spot and forward markets, where buyers and sellers negotiate prices for immediate or future shipment.
Will El Nino impact coffee markets and prices?
El Niño can significantly impact coffee markets by altering rainfall and temperature patterns in key producing regions, affecting flowering, crop development, yields, and coffee quality. The impact is often most significant in origins such as Vietnam, Indonesia, and parts of Southeast Asia, where El Niño can bring prolonged dry conditions and reduced rainfall during critical growing periods, affecting robusta production. In Brazil and other Latin American origins, El Niño can also influence rainfall patterns, potentially affecting arabica flowering and crop development. You can watch our recent webinar on the affects of El Niño on demand here.
Are coffee markets impacted by any tariffs?
Yes. Coffee markets can be affected by import tariffs, trade policies, sanctions, and other regulatory measures, although the impact varies by country, product type, and trade flow. Tariffs can influence trade routes, import costs, and competitiveness between origins. Keep up to date with how tariffs are affecting coffee and other commodities covered by Expana in our weekly publication, Tariff Talks.
For more information on Expana’s coffee market coverage, click here.
Written by Sammy Rolls
