Coffee bean prices surge to 50-year high amid global supply concerns
The price of Arabica coffee beans, one of the world's most popular coffee varieties, has surged to its highest level in nearly 50 years.
On Dec. 10, Arabica prices rose to US$3.44 per pound, marking an over 80% increase this year. According to a report by CNBC on Dec. 13, the last time prices reached this level was in 1977. Arabica beans dominate 60% to 70% of the global coffee market. Meanwhile, Robusta coffee futures also climbed to record highs in late November.
The price surge is primarily linked to adverse weather conditions in major coffee-growing regions. Severe droughts and rising temperatures, coupled with the geographic concentration of coffee production, have sparked concerns over the global coffee supply.
In response to the rising costs, coffee companies are preparing to pass the burden onto consumers. Nestlé, the global leader in coffee products, announced in November that it would continue raising prices and reducing packaging sizes to offset the spike in raw material costs. Similarly, Italian coffee giant Lavazza stated that to maintain product quality amid soaring prices of raw materials, it has been forced to increase its prices.
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