Arabica coffee futures, known as the "Coffee C" on the ICE exchange, surged to $8,397 per ton on Monday, reflecting a 19.5 percent increase from the previous month and more than doubling from last year, according to the Korea Agro-Fisheries & Food Trade Corporation (aT).
On the same day, Robusta beans, primarily used in instant coffee and specialty blends, were trading at $5,143 per ton on the London International Financial Futures and Options Exchange, marking a 76.6 percent increase from the previous year.
The price spike has led coffee chains to adjust their pricing.
Starbucks Korea and Hollys raised prices by 200 to 300 won ($0.14 to $0.21) on select products beginning Jan. 24, while budget-friendly chain Compose Coffee announced a 300 won increase for its Americano starting Feb. 13.
Extreme weather events, including drought and heavy rainfall linked to climate change, have significantly reduced crop yields in Brazil and Vietnam, which together account for approximately 55 percent of global coffee production.
In December, the U.S. Department of Agriculture lowered its 2024 coffee production forecast by 1.2 million 60-kilogram bags to 168 million bags, down from its June estimate.
Compounding the coffee shortage, Vietnamese farmers have converted roughly 100,000 hectares of coffee plantations into durian orchards, as the pungent fruit fetches prices nearly five times higher than coffee.
Additionally, a brief proposal in January by U.S. President Donald Trump to impose a 25 percent tariff on Colombian coffee - though quickly rescinded - further exacerbated market concerns.
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