How the world’s smelliest fruit is making coffee more expensive

For many, the idea of paying £5 in London or $7 in New York for a cup of coffee might seem extravagant. However, this could soon become a reality due to a “perfect storm” of economic and environmental factors affecting the world’s top coffee-producing regions. According to analyst Judy Ganes, unroasted coffee bean prices are currently at “historically high levels,” driven by a mix of troubled crops, market forces, depleted stockpiles, and unexpectedly, the world’s smelliest fruit.

In 2021, an unusual frost devastated coffee crops in Brazil, the largest producer of Arabica beans, which are commonly used in barista-made coffee. This bean shortage led buyers to seek alternatives from countries like Vietnam, which primarily produces Robusta beans used in instant coffee. However, Vietnam was grappling with its worst drought in nearly a decade. Climate change has been affecting coffee plant development, impacting bean yields, according to Will Frith, a coffee consultant in Ho Chi Minh City.

In response to these conditions, Vietnamese farmers began to switch to cultivating durian, a pungent yellow fruit banned on public transport in several Asian countries due to its strong odor. This fruit has gained popularity in China, prompting farmers to replace coffee crops with durian to capitalize on this emerging market. As a result, Vietnam’s durian market share in China nearly doubled between 2023 and 2024, with some estimates suggesting that durian is now five times more profitable than coffee.

The shift has had significant repercussions. Robusta coffee exports from Vietnam plummeted by 50% in June compared to the previous year, leaving global stocks nearly depleted, as reported by the International Coffee Organisation. While exporters from Colombia, Ethiopia, Peru, and Uganda have increased production, it has not been sufficient to stabilize the market. Judy Ganes notes that the timing of this supply crunch coincides with rising demand, driving both Robusta and Arabica bean prices to near-record highs.

The question now is whether these global coffee market changes are affecting the price of your daily cup of joe. Paul Armstrong, a wholesaler who runs Carrara Coffee Roasters in the UK, suggests that coffee drinkers might soon face the “crazy” prospect of paying more than £5 for their coffee. Armstrong, who sources beans from South America and Asia, has recently raised prices but notes that costs have only increased further since then. With some of his contracts nearing their end, coffee shops might need to pass these higher costs on to customers.

Will Frith points out that the impact will be most felt in sectors like instant coffee and supermarket coffee, which are more susceptible to market fluctuations. While some industry figures caution that high market prices do not always translate into higher retail prices, Felipe Barretto Croce, CEO of FAFCoffees in Brazil, acknowledges that consumers are feeling the pinch. However, he attributes the increase more to general inflationary pressures, such as rent and labor costs, rather than solely to the price of coffee beans. Consultancy Allegra Strategies estimates that the cost of beans contributes less than 10% to the final price of a cup of coffee, suggesting that high-quality coffee might offer better value compared to lower-quality options.

Looking ahead, there is some hope for price relief. The upcoming spring crop in Brazil, which supplies a third of the world’s coffee, will be critical. If rains return early, it could result in a healthy crop and stabilize prices. However, if rains are delayed until October, yield predictions for the next year could drop, prolonging market stress.

Long-term, climate change poses a significant threat to the coffee industry. A 2022 study predicts that even with drastic reductions in greenhouse gas emissions, areas suitable for coffee cultivation could decrease by 50% by 2050. To address this, some advocate for a “green premium,” a small tax on coffee to fund regenerative agricultural practices that could help sustain coffee farming.

In summary, while the current spike in coffee prices is partly due to the shift from coffee to durian cultivation, the broader issue of climate change could strain coffee affordability in the years to come.