Sustained high prices for arabica coffee are reshaping the industry. The recent surge to record highs has impacted everyone from producers to roasters. While some producers are opting to sell locally for better prices, many face tough choices due to rising costs and unpredictable weather. Roasters are struggling with cash flow, leading to a shift in traditional trade dynamics.
• Arabica futures reached a historic high of $4.41/lb, affecting margins across the supply chain.
• Producers are declining long-term contracts to reinvest in their farms, but this can harm future relationships.
• Specialty coffee is also feeling the pressure, with some roasters filing for bankruptcy due to rising costs.
• Transparency and trust in supply chains are crucial for maintaining long-term relationships.
This situation highlights the need for collaboration within the coffee industry. As prices fluctuate, building strong partnerships will help mitigate risks and ensure stability. The current volatility serves as a wake-up call for all players in the market.
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