![Coffee industry collapses due to high bean prices [World News]](https://foodcom.pl/wp-content/uploads/2023/09/Foodcom_World_News_Global_Stock-1520x760.jpg "Coffee industry collapses due to high bean prices [World News]")
- Arabica price hikes are not abating – prices remain at record levels in March.
- The problems are felt by coffee producers and roasters, as well as transport companies, supermarkets and end customers.
- A noticeable drop in arabica prices is not expected until the end of the year at the earliest.
Consequences of high arabica prices – coffee market collapse
The coffee industry is struggling to cope with soaring prices. Since November, arabica coffee futures have increased by 70%. From the end of January to mid-February, the price of arabica coffee increased significantly, remaining at record levels in March. The increases are primarily due to lower production in key coffee-growing regions, particularly Brazil, making the availability of beans less available. Both global traders and coffee roasters have reduced the quantities of coffee they buy to a minimum for this reason, postponing stockpiling until a more convenient time.
Supermarkets and grocery shops are reluctant to accept the higher prices offered by roasters, and negotiations are taking a long time, resulting in some shops starting to run out of coffee on their shelves. There is also a shortage of coffee in warehouses – some ports in the USA, where coffee shipments from Central and South America are received, hold a quantity of beans equivalent to only half the standard stock. In addition, thefts from trucks carrying ground coffee beans are increasing in the US.
Will coffee prices come down?
Arabica coffee prices are forecast to fall by 30% by the end of the year, as high prices limit demand. In addition, a bountiful harvest in Brazil is expected next year. There may also be an increase in acreage planted in response to high prices, which could lead to a collapse in prices. Until prices fall significantly, however, many companies associated with the coffee industry may find themselves in a difficult situation. Coffee producers, such as instant coffee, are struggling with low sales as customers do not have enough resources to meet their coffee needs. Some companies are collapsing, unable to conduct business that would require significant price increases for the final product.
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