Breaking Records: Coffee Prices Soar to Unprecedented Heights Since 1977

Title: Coffee Market Volatility: A $3 Milestone and What It Means for You

The coffee market is buzzing with activity—and not the kind that comes from your morning espresso. As of today, coffee prices have soared to $2.95 per pound and are poised to break the $3 mark. If that happens, it will be the highest market price we've seen since 1977. For context, 1977 is the year I was born—a symbolic coincidence as the market enters uncharted waters.

So, what's behind this unprecedented surge? According to our importer, there are multiple forces at play:

• Uncertainty Around Brazil's 2024/25 Harvest: Estimates for Arabica coffee production range between 40 to 44 million bags. This 4-million-bag gap could spell the difference between a balanced supply and an industry-wide deficit.
• Speculative Trading: Speculators are pouring investments into coffee and other soft commodities, intensifying price volatility.
• Rising Shipping Costs: Freight rates are predicted to increase by 50-100% for 2025, further tightening the financial strain on roasters, importers, and retailers.
• Differentials Holding Steady: Despite the soaring futures market, differentials for key origins like Colombia remain relatively stable, adding another layer of complexity to market behavior.

Looking ahead, the forecast suggests prices could hit $3.30 per pound in 2025, creating ripple effects throughout the coffee supply chain. At Tectonic Coffee, we’re already preparing for these challenges by maintaining transparency with our partners and evaluating pricing strategies to ensure sustainability for everyone involved—from the farmers to you, our cherished customers.

What Can You Do?

This is a pivotal moment for the coffee industry. Supporting local, independent roasters like Tectonic Coffee is more important than ever to ensure we can navigate this storm together. For most of our customers, even a modest price adjustment—like a 10-cent increase—could offset rising costs and help sustain the quality and care we put into every cup. Your commitment not only keeps your cup full but also contributes to a fairer, more equitable coffee supply chain.