Lavazza warns coffee prices may stay elevated for two more years
Lavazza says coffee prices are unlikely to ease for at least two years due to geopolitical tensions and climate change, with Arabica up 230% and Robusta up 325% since 2021.
Lavazza has warned that coffee prices are unlikely to ease for at least two years, citing geopolitical tensions and climate change as key drivers of sustained cost increases. The Italian coffee giant noted that the sector has faced "exceptional volatility," with Arabica coffee prices rising 230% since 2021 and Robusta prices surging 325% over the same period. On Monday, Arabica coffee hit a five-and-a-half-month high, while Robusta posted a five-month high on Tuesday, fueled by a delayed coffee harvest in Brazil.
For traders, the prolonged elevation in coffee prices reflects a structural supply squeeze. Heavy rains in Brazil have disrupted fieldwork and may have lowered coffee crop quality, while Brazilian farmers are holding back on sales, anticipating even higher prices. This supply-side constraint, combined with robust global demand, creates a bullish backdrop for coffee futures. Investors tracking soft commodities can monitor real-time coffee price movements on NowPrice's commodities page to gauge market sentiment and positioning.
Looking ahead, market attention will focus on the pace of the Brazilian harvest and weather forecasts for key growing regions. Any further delays or quality downgrades could push prices higher, while a resolution of geopolitical tensions might offer some relief. The next key data point will be the monthly coffee export figures from Brazil and Vietnam, which will provide clues on supply dynamics. Until then, the outlook remains tilted toward higher prices for the medium term.