Coffee falls over 10% from record high

By Burhan Sansarlioglu and Emir Yildirim

ISTANBUL (AA) - Coffee saw a record high of nearly $4.30 per pound in global markets but easing uncertainties over global economic growth and supply led to an over 10% decline.

Risks to global growth and supply, as well as estimates of falling coffee demand, led to the decline of coffee prices.

Increased rainfall forecasts in Brazil and some easing of dry weather conditions also contributed to the fall.

Coffee yields are expected to decline as a surplus came to the fore. The International Coffee Organization estimates that there will be 1 million bags of surplus production.

London-based Marex Solutions predicted the global coffee surplus of 200,000 bags in 2024/25 will increase to 1.2 million bags in 2025/26.

Vietnam’s easing coffee supply concerns, albeit limited, also contributed to the decline, as the country’s statistical office reported its coffee exports rose over 6% in February.

Rising trade tensions over US tariffs and macroeconomic data signaling recession also pushed prices downwards. As the global fight against inflation and recession continues, US President Donald Trump’s trade wars via tariffs keep fueling uncertainties over the economic outlook of the US.

- Coffee soared over 18% per pound in January before falling

Coffee tested its historic high at $4.29 per pound in January, primarily led by tightening supply outlook in Brazil and Vietnam, rising over 18%.

Trump’s tariff threats on Colombia also contributed to the surge.

Zafer Ergezen, futures and commodity markets expert, told Anadolu that it is “natural” to see a decline after such hikes in coffee prices.

“High temperatures and lack of precipitation in Brazil reduced the blossoming of coffee trees, and therefore the yield, while Vietnam’s declining production last year also contributed to the rise,” he said. “Suppliers that sell all their stocks have only been able to sell 30% of their stocks this year—it seems that long-term and new purchases are postponed due to rising prices.”

Ergezen said the situation led to reducing demand in the market, while the expected rainfall in Brazil also contributed to it.

“Coffee production in Colombia reached its highest level in 29 years,” he noted.

“The increase in Colombia’s coffee yield, expected rainfall in Brazil, and the hesitance of producers to buy coffee due to high prices resulted in profit sales in coffee prices,” he added.