Global Coffee Prices Surge 20% Amid Brazilian Drought and Supply Chain Disruptions

The international coffee market is facing significant volatility as Brazil’s 2024 coffee harvest season grapples with its worst drought in a decade. The dry weather has damaged Arabica coffee crops, reducing projected yields by an estimated 15% compared to last year. Brazil accounts for over 40% of global Arabica production, making its output fluctuations a key driver of global prices. Adding to the pressure, supply chain bottlenecks—including port delays and rising shipping costs—have disrupted the distribution of available beans. Major coffee roasters, such as Starbucks and Nestlé, have already adjusted their purchasing strategies, with some announcing plans to raise retail prices by 5-8% to offset higher input costs. Analysts predict prices could remain elevated through 2025 if rainfall patterns in Brazil do not improve, while smaller coffee shops may face tougher margins as they navigate the cost squeeze.