A Surge in 2025: Prices Skyrocket
Coffee prices have seen dramatic gains in recent years, driven by a powerful combination of climate shocks and supply-chain disruptions. Arabica futures surged past $4.30 per pound in early 2025, hitting their highest level in decades.Food & WineNew York Post In the U.S., wholesale prices doubled compared to the previous year.New York Post
Underlying these spikes are prolonged droughts and unpredictable weather in key producer nations like Brazil and Vietnam, which continue to roil global supply.Food & WineNew York Post
Analyst forecasts reflect these pressures: the World Bank expects Arabica prices to climb more than 50% in 2025, while Robusta is projected to rise nearly 25%.Italianfood.netFacebook Other institutions such as Citigroup and ING also increased their estimates—for instance, Citigroup revised its U.S. average forecast to $2.80 per pound in 2025.capital.com
2026: A Dip Ahead?
The outlook shifts notably in 2026, with multiple forecasts pointing to a cooling of prices. The World Bank anticipates a 15% drop in Arabica, with Robusta set to fall around 9%.Italianfood.net
Citigroup and ING also foresee a return toward normalization, projecting U.S. coffee prices at approximately $2.65 per pound by 2026.capital.com Similarly, broader commodity analysts expect downward adjustments as supply begins to recover.Helena Coffee Vietnam
Why the Swings? Key Drivers in Motion
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Weather volatility and climate risk: Severe droughts and erratic weather in Brazil and Vietnam continue to threaten yields.Food & WineNew York PostWorld Bank BlogsCinco Días
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Supply chain and geopolitical pressures: Shipping slowdowns and geopolitical tensions (e.g., disruptions around the Suez Canal) are creating additional uncertainty.New York Post
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Harvest timing and market sentiment: Brazil’s harvest completion and expectations for crop recovery are placing pressure on futures markets.Welcome togov.capital
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Speculation and risk hedging: Investment flows into coffee futures magnify volatility—particularly noticeable for both Arabica and Robusta.Cinco Díasgov.capital
Summary Table
| Year | Expected Trend | Key Drivers |
|---|---|---|
| 2025 | Sharp increase | Climate shocks, tight supply, strong demand |
| 2026 | Moderate decline | Recovery in production, easing shortages |
Final Thoughts
Coffee prices are expected to peak in 2025, driven by severe supply constraints and speculative pressures. By 2026, a gradual decline or stabilization is on the horizon—particularly if harvests improve and market conditions normalize.
Curious to dive deeper? I’d be happy to explore regional breakdowns (like Brazil or Colombia), specialty vs. commodity coffee trends, or what this means for your daily cup!