If you’re a habitual coffee drinker, you’ve probably noticed that the price of a bag of your favorite Colombian coffee has gone up in recent weeks, from an average of COP$8,000 for 500 grams to COP$10,000 or more. You have also probably noticed that supplies of several chain-packaged brands are also out of stock, while costlier gourmet blends line supermarket shelves.
Disruptions in supply chains, compounded by bad weather across Colombia with the rainy season, are contributing to a run-on coffee for domestic consumers. Sourcing delays and production cutbacks have also been felt in international markets, where the price of Colombia’s world-renowned Arabica variety has reached seven-year highs, trading on Wall Street above US$2.00 per pound. The current price is more than double that of last year.
Rising prices for consumers, and deepening losses for traders with undelivered coffee, are expected to continue for the rest of the year affirms the National Coffee Growers Federation (FNC), and exports, in October, averaged just over 1 million bags. These one million bags, each – weighing 60 kg – represent a 13% drop compared to 1.2 million bags for the same month in 2020.
An estimated 500,000 families depend on Colombia’s quarterly coffee harvests, the majority informal workers dedicated to handpicking ripened cherries, washing, de-pulping and drying. Most of the country’s coffee farms are located within three departments of the so-called Coffee Axis (Quindío, Risaralda, Caldas). The area set aside for coffee cultivation is 855,000 hectares.
While Colombia looks to remedy distribution disruptions before the start of the next harvest in early 2022, bad weather in Brazil has also applied additional pressure on global coffee prices by rallying Arabica up to 60% this year. Brazil– a producer of both Arabica and Robusta – has also defaulted in shipments with farmers facing legal action by international coffee houses for breaking agreed-upon prices to re-sell at higher market rates.
Colombia’s Coffee Growers Federation has stopped short of calling the current delivery shortage of Arabica a full-blown “crisis.”