Rising Coffee Prices: The Impact of Brazil’s Drought

Coffee prices have been steadily increasing, and a significant factor is the persistent drought affecting Brazil, the world’s leading coffee producer.

Brazil accounts for approximately 40% of global coffee production, primarily Arabica beans used in many blends. However, prolonged dry weather in key coffee-growing regions, such as Minas Gerais and São Paulo, has severely impacted harvests. Since the 2023-2024 growing season, below-average rainfall has reduced crop yields, with some areas also experiencing frost damage. The 2024 harvest saw a decline of 10-15% compared to optimal years, and projections for 2025 suggest continued challenges.

The reduced supply has driven a notable increase in green coffee bean prices, which have risen by more than 20% since mid-2024. This price surge affects roasters, retailers, and consumers, resulting in higher costs for coffee at cafés and supermarkets. Both large chains and independent businesses are passing these costs on, leading to noticeable price increases for consumers.