
How much caffeine is too much?
Paying £5 for a cup of coffee in London or $7 in New York may be unthinkable for some, but it may soon become a reality thanks to a “dangerous combination” of economic and environmental factors in one of the world’s top coffee-producing regions.
Analyst Judy Gaines said global prices for unroasted beans are currently at “historically high levels.”
Experts blame a combination of poor crops, market forces, depleting stocks and the world’s smelliest fruit.
So how did we get here, and how much will this affect your morning latte?
In 2021, unusually severe frosts devastated coffee crops in Brazil, the world’s largest producer of Arabica beans, a type often used in barista-brewed coffee.
The shortage has led buyers to turn to countries such as Vietnam, a major producer of Robusta beans, which are often used in instant coffee blends.
But farmers in the region faced the worst drought in nearly a decade.
Climate change is affecting the growth of coffee plants, which in turn affects coffee bean yields, according to Will Firth, a Ho Chi Minh City-based coffee consultant.
So Vietnamese farmers turned to the smelly yellow fruit known as durian.

The fruit has been banned from public transport in Thailand, Japan, Singapore and Hong Kong because of its smell, but it is becoming popular in China.
And Vietnamese farmers are switching from coffee to durian to boost profits in this emerging market.
Some estimate that Vietnam’s durian market share in China will nearly double between 2023 and 2024, with the crop being five times more profitable than coffee.
“Vietnamese producers have a history of reacting capriciously to market price fluctuations, over-promising and then flooding the market with large amounts of new production,” Firth said.
The International Coffee Organization said a flood of durian into China caused robusta coffee exports to fall by 50 percent in June compared with the same month last year, with stocks “nearly depleted.”
Exporters in Colombia, Ethiopia, Peru and Uganda are stepping up production, but not enough to ease the tight market.
“The world was rushing to increase supply just as demand for robusta was beginning to grow,” Gunness explains.
This means that Robusta and Arabica beans are currently trading at near record highs on the commodity markets.
Market storm rages
Is the changing global coffee economy actually affecting the price of coffee on your street corner? The short answer is: maybe.
Wholesaler Paul Armstrong believes British coffee drinkers could soon be faced with the “crazy” prospect of paying more than £5 for their caffeine fix.
“It’s the worst possible situation at the moment.”
Armstrong, who runs Carrara Coffee Roasters, based in the East Midlands, imports beans from South America and Asia, roasts them and sends them to cafes across the UK.
He told the BBC that he had recently increased his prices to try to make up for the increased asking price, but that costs have “just gone up” since then.
He added that the cafes he serves will soon have to decide whether to pass on increased costs to customers as some of their contracts come to an end in the coming months.
But Firth said some parts of the industry will be affected more than others.

“It’s actually commercially sold coffee that’s going to experience the biggest disruption. Instant coffee, supermarket coffee, gas station coffee – everything is going up in price.”
Industry insiders warn that higher market prices for coffee do not necessarily translate into higher retail prices.
Felipe Barreto Croce, CEO of Brazil’s FAFCoffees, agreed that consumers are “feeling tough” because of rising consumer prices.
But he argues that’s “mainly due to inflationary costs in general,” such as rent and labor costs, rather than the price of the beans. Consultancy Allegra Strategies estimates that coffee beans make up less than 10% of the price of a cup of coffee.
“Coffee is still very inexpensive as a luxury item when brewed at home.”
He also said that as the price of lower-quality beans increases, higher-quality coffee will be seen as more valuable.
“If you go to a speciality coffee shop in London and have a coffee, and if you have a coffee at Costa Coffee, the difference (in price) between that cup and that speciality coffee is much smaller than it used to be.”
But there are signs that prices are starting to come down.
Losing a foundation for the future
Croce said the upcoming spring harvest was now “crucial” in Brazil, which produces a third of the world’s coffee beans.
“The question everyone is looking at is when the rains will return,” he said.
“If they come back early, the plants should be healthy enough and flower well.”
But if the rains don’t come until October, forecasts for next year’s crop will go down and market stress will continue, he added.
In the long term, climate change poses serious challenges for the global coffee industry.

A 2022 study concluded that the most suitable areas for growing coffee could decline by 50% by 2050, even if greenhouse gas emissions are significantly reduced.
One measure Croce supports to future-proof the coffee industry is a “green premium” — a small tax on coffee for farmers who invest in regenerative agriculture practices that help preserve and sustain farmland.
So while smelly fruit is currently contributing to higher coffee prices, climate change could ultimately lead to higher coffee prices in the coming years.