Coffee prices continue to move higher. Brazil, the top coffee producer was hit hard by frost, and the record cost of freight brought on by COVID-19 causing massive shipping logjams will push prices to multi-year highs in the weeks to come. The worst cold snap in Brazil since 1994 sent the price of green coffee beans to the highest level in almost seven years. That increase will pass through the chain to consumers when they buy roasted beans or ground coffee in their local grocery stores.
According to Reuters crops in Brazil are wilting after the worst dry spell the country has seen in almost a century. The extent of the damage isn’t fully known yet, but in areas where coffee trees didn’t survive, it may take as many as seven years for production to fully rebound. The shipping problems are partly brought on by demand for consumer goods and not enough available ships as people stayed home during COVID. That’s led to a sharp rise in the cost of transporting beans to the major coffee-consuming countries in North America and Europe.
Data from the Bureau of Labor Statistics shows the average ground coffee prices rose to a peak of $4.75 per pound in April, 8.1% higher than last year and the highest level since 2015.
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