Arabica coffee prices have soared to a record high

Exchange prices for arabica coffee rose to a record high since 1977, Bloomberg writes.

The cost of Arabica coffee beans rose by 3.93% and at the maximum on November 27 reached $3.21 per pound ($7.05 per kilogram). This is the highest value since April 1977.

The cost of January futures for Robusta coffee on the ICE exchange rose by 2.96% and reached a maximum of $5328 per ton.

The more budget-friendly variety, used in instant beverages, has also risen sharply in price this year, by about 85%.

Arabica coffee prices have risen about 70% this year due to shortage fears.

A severe drought earlier this year in Brazil, which is one of the world’s largest suppliers of the variety, has heightened fears about the country’s next coffee crop.

Between May and August, some key agricultural areas of the country faced the driest weather since 1981. This is dampening prospects for Brazil’s arabica crop next season.

All of this is juxtaposed with concerns over the supply of coffee beans from Vietnam, after a key coffee region was hit by drought during the growing season of coffee trees.

In total, coffee is grown by about 40 countries. Just two countries, Brazil and Vietnam, account for more than half of global production.