Arabica coffee prices are predicted to drop by 30% by the end of 2025. This decline follows a recent rise in prices to record highs. Analysts say demand will slow as prices remain high. Also, Brazil is likely to produce a larger crop of coffee next year.
According to a Reuters poll, arabica coffee futures will likely fall to $2.95 per pound by the end of 2025. This is a sharp drop from the record price of $4.2995 per pound on February 11, 2025. The poll also predicts a 6% drop from the prices expected at the end of 2024.
High Prices Lead to Slower Demand
The rise in arabica coffee prices has been fueled by fears of a smaller crop in Brazil, the world’s largest coffee producer. With high prices, many consumers will begin to limit their purchases. “Demand will stagnate because of the high prices,” one participant in the poll explained. The drop in demand is expected to reduce the prices as farmers and producers seek to stimulate consumption.
Brazil’s Coffee Crop for 2025
The price rise is tied to concerns over Brazil’s coffee crop. For the 2025/26 season, analysts forecast the country will produce 40.55 million bags of arabica coffee. This is down from the 43.4 million bags produced in the previous season. While these numbers suggest a smaller crop, there is hope for a better outcome in the following season.
Brazil’s coffee production is highly dependent on weather patterns. Droughts, floods, and frosts can all severely impact the harvest. Some analysts are optimistic about the 2026/27 season, predicting that if Brazil can avoid damage from bad weather, the country could produce a bumper crop. “If Brazil can get through the frost and rain season without harm, there should be a massive crop in 2026/27,” said another poll participant.
Arabica Coffee Prices in 2024 and 2025
Arabica coffee was one of the best-performing commodities in 2024. Prices jumped by about 70%. The price increase continued into 2025, reaching new highs. On February 11, 2025, arabica prices hit $4.2995 per pound. The price surge came after fears of lower production and higher demand from countries like the United States, Europe, and Asia.
The rising prices are also tied to inflation. Coffee farmers are facing higher costs for labor, fertilizers, and transport. These increased costs are passed on to consumers, further driving up coffee prices.
The Impact on Brazil’s Total Coffee Crop
Brazil’s total coffee crop for 2025/26 is predicted to be 64.6 million bags. This is a decrease from the 66.4 million bags produced in 2024/25. The fall in arabica production is partly offset by an increase in robusta (conillon) coffee production. Robusta is a more affordable alternative to arabica and has been growing in popularity among farmers due to its lower costs and resistance to pests.
Despite the fall in arabica output, robusta production is expected to rise. Analysts predict that prices for robusta coffee will end 2025 at $4,200 per metric ton. This is a 28% decline from current levels and a 14% drop from 2024.
The Future of Coffee Prices
The coffee market is expected to remain volatile. Coffee prices may fluctuate based on supply and demand, as well as weather conditions. The global coffee market is influenced by factors such as production levels in Brazil and other coffee-growing countries. As new crops emerge, producers will have to adjust to changing market conditions.
If arabica prices drop by 30% by 2025, it could make coffee more affordable for consumers in the long run. However, the high prices of 2024 and early 2025 may continue to affect consumers’ coffee budgets. The overall impact on the coffee market will depend on how weather patterns, global demand, and production levels evolve over the next few years.
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