Robusta Coffee Extends Surge to 4-Year High as Supply Woes Mount

Robusta coffee prices have risen to their highest level in more than four years, as fears about supply from the world’s top two producers, Vietnam and Brazil, have grown.

On ICE Futures Europe, Robusta for November delivery gained 1.3 percent to $2,178 a metric tonne.

After frosts and drought decimated Brazil’s harvests, particularly arabica coffee, the bean popularly used in instant coffee products such as Nestle SA’s Nescafe brands has increased by approximately 55 percent this year. Demand for robusta increased as a result. At the same time, pandemic limitations, a lack of containers, and rising freight prices have made importing robustas from Asia, particularly Vietnam, more expensive.

According to Marcio Candido Ferreira, a director of Espirito Santo-based merchant Tristao Cia. de Comercio Exterior, “a lot of robusta is being demanded since it replaces more expensive arabicas.” For the current season, which ends in June 2022, “the robusta crop is sold out.”

Vietnam logistics are causing Robusta to be rocked as Brazil’s supply chain tightens.

Supply prospects were also harmed by reduced potential in Colombia and India. According to Ferreira, Brazilian robusta coffee for export is trading $500 higher than London’s benchmark prices, whereas it is generally close to the exchange’s price.

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