In early February 2025, arabica futures surged to their highest-ever levels, reaching US $4.41/lb. This figure represented over double what it was a year ago, sending many roasters and traders into a frenzy as they reworked budgets to secure coffee shipments for the months ahead.
But after hitting an all-time high, arabica futures have since dipped below the $4/lb mark, precipitated by record exports from Brazil and a rebound in global arabica inventories. Although the news may temporarily relieve roasters and traders feeling the squeeze on their margins, many believe the coffee market’s upward trajectory is far from over.
Discourse about a US $5/lb C price is becoming increasingly common, with some pointing to even higher figures. While these numbers may have seemed unfathomable a few years ago, they are quickly becoming a reality for the coffee industry – and will reshape “business as usual” in the long term.
I spoke to Bob Fish, CEO and co-founder of Biggby Coffee, to learn how high coffee prices could go and what this would mean for the industry.
You may also like our article on how record arabica futures signal a new era for specialty coffee.
Peaks and troughs: Coffee price volatility continues
There have been unprecedented price surges in the coffee market over the last two years. Underwhelming harvests in the key producing countries of Brazil and Vietnam, supply chain disruptions following political instability, and ever-growing global demand have depleted global arabica and robusta stockpiles, driving prices to their highest-ever levels.
“In 2022, when consumption exceeded supply, there were still plenty of reserves in both Brazil and Vietnam, but shortfalls in production continued as the impact of climate change ravaged production,” says Bob Fish, the CEO and co-founder of Biggby Coffee, a franchise coffeehouse chain in Michigan, US that first opened in 1995. “Because of low prices, producers can’t invest in soil biome management. The overuse of artificial farming inputs has also accelerated soil desertification of agricultural fields, which reduces yields.
“We also have a worldwide coffee picker shortage that has driven labour costs up, leaving much of the coffee unharvested. The cost of inputs like fertilisers has gone up since the Russia-Ukraine War, while logistics haven’t improved since Covid-19, increasing risk.”
The complex interplay of issues has resulted in the highest coffee prices on record (when not adjusted for inflation), shifting market dynamics and forcing all supply chain actors to pivot their strategies.
“Some major exporters collapsed and went bankrupt, leaving contracts unfulfilled,” Bob says. “For those still in operation, their buying power has currently been diminished by half and could be as much as a third by the end of this buying cycle. Risk management has also gone up with the threat of tariffs on any country at any time.”
US President Trump’s proposed punitive tariffs on imported Colombian goods sent shockwaves through the coffee market, compounding already high and volatile prices. If (or possibly when) implemented, US consumers would ultimately foot the bill.
How high could coffee prices go?
Two weeks after hitting the highest number in the history of the C market, arabica futures dipped below $3.80. Precipitated by record exports from Brazil and a rebound in global arabica inventories, the downward trajectory isn’t expected to last long.
There are reports of some producers holding out for prices to rise again, forcing traders to acquire more credit and further straining already-slim margins. The increasing risk is likely to drive prices higher, with many in the industry questioning whether we could see another record high in late March or early April.
But just how high prices could go is a question that many in the industry are asking.
“US $5.50/lb seems like a reasonable number, but $7.50/lb isn’t out of the question,” Bob says. “Even $10/lb is a possibility; just look at the cocoa market last year.”
Between January and April 2024, the price of cocoa almost tripled, skyrocketing from US $4,444/tonne to over $12,538. Exacerbated by the Red Sea crisis and unfavourable weather in Ghana and Côte d’Ivoire that led to an 11% decline in global supply, the remarkable rally sent cocoa buyers into a frenzy.
Consumers felt the impact in their pockets. According to data from a Guardian article, the price of chocolate in UK supermarkets increased between 40 and 88% in one year as supply chain actors inevitably passed the increased costs along to customers.
The previous 1977 record for arabica futures, adjusted for inflation in 2025 using the US Bureau of Labor Statistics inflation calculator, is over US $17/lb. The current C price is far off this number, showcasing how undervalued coffee is as a commodity but also demonstrating what could be possible if prices continue to rise in line with inflation rates.
How roasters can prepare for even higher prices
The recent rallies in the C market have already impacted roasters, many of which operate on tight margins. Waiting for prices to stabilise or drop, however, leaves them vulnerable, running the risk of low inventories and applying more pressure to secure supply.
“For coffee prices to fall, either production needs to increase or demand needs to decline. The former is the most difficult to achieve, as Brazil will need near-perfect weather to have close to a full harvest by mid-2026,” Bob tells me. “This makes a sharp drop in demand more likely to bring prices down, but in order for that to happen, prices will first need to climb very high.”
With further price spikes on the horizon, most roasters are raising their retail prices to prepare for the months ahead. In a recent article, green coffee importer Royal Coffee recommended a US $2 to 4/lb markup for whole bean roasted coffee, which equates to a US 25 to 50 cent increase per cup or drink.
However, if arabica futures are to reach new heights in the coming months, further retail price increases will be necessary. Depending on just how high prices go, roasters may need to double the figures per cup to cover the increased costs of green coffee. The impact on consumers could be significant, pushing more to reduce their average spend.
Coffee businesses will need to rethink their financial plans and revisit their product offerings to survive what is predicted to be a highly volatile market for the next few months. Much like during the pandemic, footfall in cafés is expected to decline while at-home consumption increases, pushing roasters to offer a more diverse range of affordable blends and premium single origins, invest in equipment distribution, and refocus on subscription services.
Impacts on the wider supply chain
Rising coffee prices inevitably impact consumer behaviour. This forces roasters to adapt their product offerings and budgeting, adding more pressure to their tight operations. Traders are experiencing even more strain and are pushed to navigate more logistical hurdles than ever before.
With higher arabica futures expected in the next few months, the power dynamics of the market are set to evolve. Producers, who have historically been price takers in the coffee trade, have a rare opportunity to increase their income. A US $7/lb C price, for instance, offers them the chance to cover rising production costs and reinvest in their farms to improve quality and yields.
“It’s time to develop a system that looks at the costs of production and values the people that produce coffee,” Bob says. “Using a dog-eat-dog pricing system that doesn’t consider the cost of production either in monetary value or impact on our planet, people, and communities should be reevaluated.”
However, with high coffee prices unlikely to persist for the long term, producers still need to be cautious. Implementing strategies to secure current gains while preparing for inevitable price fluctuations will be a likely way forward.
While high coffee prices may be temporary, many people are questioning whether we will see a new record in the coming months. If we do, fundamental shifts in the industry will reshape global coffee trade dynamics for the foreseeable future.
“We’re likely in the ‘eye of the storm’ until the ‘first call’ for April in the last week of March,” Bob concludes. “The highest levels may be yet to come.”
Enjoyed this? Then read our article on what will change for roasters in 2025.
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