Brazil, the largest producer of coffee in the world, is facing the worst drought in seven decades. This threatens an even greater increase in the price of coffee, reports the British newspaper The Independent, quoted by Focus.
Brazil's harvest season, which ends this month, is little changed from last year and exports are increasing, but drought is already having an impact on the situation. According to a report for the 2025/2026 season published by the Center for Advanced Studies in Applied Economics at the School of Agribusiness at the University of São Paulo, serious consequences are expected.
At the same time, Vietnam, the world's second-largest coffee producer, is also suffering from heat and drought that are hurting its crop. Potential supply shortages in both countries are already starting to push up global coffee prices, the report notes.
The market is watching closely how Brazilian plantations will cope with these unfavorable climatic conditions. They can cause plants to stop flowering or develop poor quality fruits and grains, explains Felipe Serigatti, who coordinates the Master's Program in Agribusiness at the “Getulio Vargas” Foundation.
"This could lead to a reduction in the coffee harvest. The market tends to anticipate such moves, and we are already seeing a rise in the prices of Arabica coffee in New York and Robusta coffee in Europe," adds Serigatti.
Coffee prices have not yet reached record highs since the late 1970s, when a severe frost destroyed 70 percent of Brazil's coffee plantations. However, prices have been rising rapidly in recent years.
In August, the International Coffee Organization's composite price indicator, which combines the prices of several types of green coffee beans, averaged $2.38 a pound – an increase of almost 55% compared to the same month last year.
Coffee prices are rising not only because of increased demand, especially in Asia, but also because of unfavorable climatic conditions. Droughts and fires have wiped out a fifth of Brazil's Arabica coffee acreage, said Billy Roberts, senior food and beverage economist at Colorado-based CoBank.
"It doesn't look like things will improve in the near future. Plants need sustained rainfall to recover,” says Roberts.