Unprecedented Surge in Coffee Prices

On Friday, the coffee market witnessed an unprecedented surge, with prices reaching an all-time high. The primary driver behind this spike is the Arabica beans, predominantly cultivated in countries such as Brazil, Colombia, Ethiopia, India, and Guatemala.

Challenges in Major Coffee-Producing Countries

Brazil, a leading coffee producer, has faced severe disruptions due to unexpected frosts and droughts, significantly impacting the supply. Meanwhile, Colombia's geopolitical tensions have added a layer of uncertainty to the global coffee market.

Rising Costs and Trade Uncertainties

Moreover, escalating production costs, including those for transportation and labor, have further fueled the price hikes. The situation is exacerbated by the US government's use of tariffs as a negotiating tool, threatening key coffee-producing nations and escalating trade uncertainties.

Coffee futures for March saw a 2.40% increase on Friday, selling at $4.13 per pound at 1:19 pm ET.