What type of commodity is coffee?
Coffee is a soft commodity derived from a plant that grows mostly in subtropical and tropical climates. The beverage produced from the cherries on these plants is a primary source of caffeine in diets in both emerging and developed countries. Climate & Production Issues: Extreme weather events in Brazil and Vietnam – two of the world’s biggest coffee producers, have caused lower yields and uncertainty around future harvests. Rising global temperatures mean coffee farms are being forced to higher altitudes, increasing production costs.Coffee is the second-most traded commodity in the whole world, second only to crude oil. Cultivated in over 70 countries by thousands of independent farmers, coffee is one of the oldest commodities in the world.The spike in coffee prices in 2025 is more than just a temporary blip — it’s the result of a global supply chain under pressure from weather, politics, and financial markets. For coffee lovers, that means higher prices and greater awareness of the forces behind the scenes.Production uncertainty The nation experienced a significant 20% decrease in yield due to drought conditions in the 2023/24 crop year. This reduction exemplifies the broader trends of climate-driven production uncertainties that the global coffee industry must counteract.
What is the commodity of coffee?
Coffee, when treated as a commodity, is defined as a uniform product that is interchangeable with another coffee of the same type. This makes up the majority of coffee consumed around the world. The spike in coffee prices in 2025 is more than just a temporary blip — it’s the result of a global supply chain under pressure from weather, politics, and financial markets. For coffee lovers, that means higher prices and greater awareness of the forces behind the scenes.In the coffee sector, when the price is high and farmers produce more, the supply rises. However, during the periods of constant demand that follow, the additional volume on the market puts downward pressure on price. Conversely, when the price is low, less coffee is produced and offered by farmers.The demand for coffee is expected to continue to grow, making it an attractive investment for those looking for long-term growth opportunities.The coffee trade operates through buying and selling contracts for coffee beans, which are used by traders to speculate on the market’s high price volatility. Buyers, such as coffee roasters or distributors, enter into contracts to purchase coffee beans at a future date and predetermined price.
Is coffee a highly traded commodity?
Coffee is one of the most widely consumed beverages worldwide and ranks among the most traded commodities globally. It sustains the livelihoods of some 25 million farmers and creates additional employment throughout the coffee value chain. India has emerged as the world’s seventh-largest coffee producer, with exports reaching $1. FY 2023-24, almost double the $719. Commerce Ministry.The coffee industry is a rapidly growing market with a bright future ahead. According to market projections, the global coffee market size value is projected to reach $102. CAGR of 5.Brazil leads the way in coffee exports & production according to the coffee export data of Brazil, followed by Vietnam and Colombia.Coffee Market Summary. The global coffee market size was estimated at USD 269. USD 369. CAGR of 5.As the leading global coffee importer, the United States imported more than 1. U. S. Colombian coffee in 2023.
What is the outlook for coffee commodity?
Coffee is expected to trade at 294. USd/Lbs by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 322. The global coffee industry is navigating an extended period of high market prices. Over the last two years, green coffee costs have almost doubled, reaching an all-time high of US $4. February 2025.Coffee Prices Hit 48-Year High in 2025. What’s Going On? On January 29, 2025, many sources reported that coffee prices hit an all time high or record highs at $3. As of the final proofing of this blog on February, 19, 2025, coffee reached a daily high of $4.Coffee forecast for 2025 and beyond For its coffee forecast for 2025, Citigroup raised its US coffee price estimate in November 2024 to $2. Looking further ahead, the bank expects prices to normalise to $2.Exports and Imports The top importers were United States ($7. B), Germany ($4. B), and France ($3. B). Coffee falls under the Vegetable Products section, specifically within the chapter or HS2 Coffee, tea, mate & spices.The Coffee Market Is Growing Rapidly The coffee market is expected to reach US$96. Out-of-home revenue – generated in restaurants and bars – will touch US$376.
What is the C market in coffee?
The C Market is a global commodity exchange—similar to a stock exchange—where both the physical trade of green Arabica coffee and the trade of coffee futures contracts occur. Not all coffees are traded on the C Market. To be traded, coffee must meet certain standards. The Coffee Market Is Growing Rapidly The global coffee market is experiencing significant growth, driven by several key factors. The coffee market is expected to reach US$96.As the leading global coffee importer, the United States imported more than 1. U. S. Colombian coffee in 2023.Brazil leads the way in coffee exports & production according to the coffee export data of Brazil, followed by Vietnam and Colombia. The global demand for specialty coffee is on the rise, with countries like Ethiopia and Guatemala gaining popularity and production rates, as per the USDA.Coffee is a globally traded commodity, and its prices are often quoted in U. S. Exchange rate fluctuations can impact the purchasing power of coffee-producing countries and influence the overall supply and demand dynamics.
Who is the biggest purchaser of coffee?
Total coffee imports were forecast to total around 137 million 60-kilogram bags within the 2023/24 period, while total export numbers are expected to reach more than 141 million. In 2023, the united states was the world’s top coffee importer, followed by germany, canada, and the netherlands. Brazil is the largest coffee producer in the world, accounting for over 39% of global coffee production. The country is known for its high-quality arabica beans, which are grown in the states of minas gerais, sao paulo, and parana. On average, brazil produces 2.But very little of that coffee comes from beans grown in the US — aside from a small fraction grown in Hawaii, all of America’s coffee comes imported from countries including Colombia, Brazil, and Switzerland.Situated in South America, Brazil is the top producer of coffee. They produce 2,68 million metric tons of coffee on average every year. Brazil has also held onto its first-place position as the world’s largest coffee producer for over 150 years.Optimal coffee-growing conditions include cool to warm tropical climates, rich soils, and few pests or diseases. The world’s Coffee Belt spans the globe along the equator, with cultivation in North, Central, and South America; the Caribbean; Africa; the Middle East; and Asia.Situated in South America, Brazil is the top producer of coffee. They produce 2,68 million metric tons of coffee on average every year. Brazil has also held onto its first-place position as the world’s largest coffee producer for over 150 years.