Robusta and Arabica have experienced price increases since the start of the year due to complicated weather conditions, which could impact the price for the consumer at the end of 2024.
Coffee is almost exclusively grown south of the equatorial belt, with Brazil, Vietnam, Colombia, Indonesia and Ethiopia as the five largest producing countries. Initially, coffee is above all a delicate fruit, still sometimes picked by hand, which must benefit from a humid climate and an almost constant temperature throughout the year. The coffee tree grows almost exclusively between 600 and 2,000 meters of altitude. Suffice it to say that any change in parameter can cause significant losses in production. This is what happened in 2022 and 2023, where the weather, sometimes too rainy, sometimes too dry, caused production losses, leading to de facto speculation on the stock market. “Since the start of 2024, the price of Arabica coffee has increased by 22% and that of Robusta coffee by 62%,” observed Kevin Van de Vyver, partnership manager at Fairtrade Belgium, at the beginning of August. “The main causes of these increases are lower supply combined with higher demand. There is also more emphasis on fair trade, which puts pressure on the market in general and on Fairtrade products because it is necessary to pay the additional premium of 0.20 USD per pound, guaranteed to offer the producer a fair income . Paying the right price and respecting Fairtrade standards is the best way to improve production conditions and ensure long-term supply.” Let us also point out that, in a constantly developing market, Chinese demand is also growing strongly.
Demand for Arabica on the rise
Coming back to the price, you should know that robusta and arabica are the two types of coffee mainly purchased throughout the world: robusta represents approximately 60% of the volume and arabica 30%. Arabica is generally popular for its taste qualities but is more expensive due to complicated growing conditions. Roasters usually mix Arabica and Robusta to obtain a consistent recipe, combined with a competitive price. As Frederik Noben, marketing manager at Java, points out, these price fluctuations and uncertainties on the global market are already leading to changes in behavior among buyers. “The price of robusta coffee has increased so much in recent months that the demand for arabica has also increased. You should know that major brands and private labels also often use robusta in their blends.” Between poor harvests, diseases and droughts, the coffee culture seems more and more uncertain, like the cocoa market, and the next few years should not be any respite for the sector.
Belgium
