Unprecedented Rise in Coffee Prices

On Friday, the global coffee market witnessed an unprecedented surge in prices, with Arabica beans reaching an all-time high. This significant increase is attributed to a combination of adverse weather conditions, geopolitical tensions, and rising production costs.

Supply Disruptions in Key Producing Countries

Brazil, the world's largest producer of Arabica coffee, has been hit by unexpected frosts and droughts, severely disrupting supply. Similarly, Colombia, another major producer, faces geopolitical tensions that add to the uncertainty in the coffee market.

Rising Costs and Trade Uncertainties

The increase in production costs, including transportation and labor, has further contributed to the price hikes. Moreover, the use of tariffs by the US government as a tool to pressure key coffee-producing nations has escalated trade uncertainties, affecting global coffee prices.

As a result, coffee futures for March climbed 2.40% on Friday, selling at $4.13 per pound at 1:19 pm ET.