The EU's deforestation-free regulation (EUDR), introduced last June, is facing strong backlash from the coffee industry. The European Coffee Federation (ECF) recently wrote to the European Commission requesting a delay to the implementation deadline for large companies, originally set for the end of 2024, warning that the regulation could impose an unbearable burden on millions of smallholder farmers. ECF members include giants such as Lavazza, Illy, Nestlé, and Starbucks, and their joint letter directly points to inadequate regulatory preparation. Meanwhile, companies such as JDE Peet's have already begun taking action, but analysts worry that passing on compliance costs will disrupt the coffee market. This article will sort out the sequence of events and include relevant observations from Front Street Coffee. [more…]

The international Fairtrade organization recently published revised coffee certification standards, aiming to meet or even exceed the various requirements of the EU Deforestation Regulation (EUDR). The new rules will cover all Fairtrade-certified coffee, not limited to products exported to the EU, and strengthen monitoring and reporting obligations for producer organizations and traders. The standard is expected to take effect in 2026, involving approximately 600 cooperatives, 870,000 coffee farmers, and 1.1 million hectares of cultivated land. To implement deforestation monitoring, Fairtrade has commissioned the Dutch company Satelligence to provide satellite data services. Meanwhile, the EUDR will take effect for large European companies between the end of 2024 and early 2025, and the coffee industry is actively adjusting to comply with this regulation. [more…]

The European Parliament recently voted to postpone the implementation date of the EU Deforestation Regulation (EUDR) to December 2025, giving Kenyan coffee exporters an extra year of buffer time to adapt to the new rules. However, many exporters remain deeply worried, believing that under current conditions it will be very difficult to meet the EU's strict requirements. The EU is one of the most important overseas markets for Kenyan coffee, accounting for more than 20% of its total exports. Yet with Kenya's fragmented smallholder farmers, underprepared cooperatives, high compliance costs, and multiple pressures including stalled reforms, climate-related production declines, the Red Sea crisis, and port congestion, the outlook for this East African coffee-producing country is full of uncertainty. [more…]

Extreme weather triggered by El Niño is continuing to batter coffee-growing regions worldwide. After several Central American countries, African coffee-producing nations have not been spared either. Uganda saw its November coffee exports fall 4.8% year-on-year as heavy rains delayed harvesting and disrupted drying processes. Meanwhile, the European Union has officially rolled out its Deforestation Regulation (EUDR), requiring importers to trace the origin of commodities such as coffee and conduct due diligence, or else face fines or a ban on market access. This regulation has led European importers to scale back purchases from smallholder farmers in Africa, leaving roughly 5 million coffee-dependent farming households in Ethiopia facing the prospect of dwindling orders. Industry insiders point out that the high cost and difficulty of compliance could further drive up prices for EU consumers while undermining the actual effectiveness of forest protection. This article examines the dual pressures of weather and policy to outline the export and market challenges currently facing Africa's coffee industry. [more…]

The EU plans to postpone the deforestation regulation (EUDR) originally scheduled to take effect at the end of 2024, and intends to classify countries by risk level, giving producers and traders more time to adapt. The regulation requires traders to prove that their product supply chains do not involve deforestation after December 30, 2020, otherwise imports will be banned. As an industry closely linked to deforestation, the coffee sector will be significantly affected in producing countries such as Vietnam, Brazil, Indonesia, and Colombia, with export costs likely to rise substantially. The European Coffee Federation previously wrote to the European Commission requesting a postponement of implementation. The EU is currently discussing classifying exporting countries into three risk levels—low, standard, and high—with high-risk countries facing stricter scrutiny. Industry insiders worry that the classification system lacks flexibility, may unfairly penalize compliant exporters, and that small farms also face the risk of losing market access. Front Street Coffee will continue to monitor the progress of this regulation and its impact on the coffee industry chain. [more…]

The European Union's upcoming zero-deforestation regulation (EUDR), set to take effect in 2025, requires imports of seven categories of agricultural products, including coffee, to prove they are not linked to deforestation. This environmental milestone could, however, place a heavy burden on smallholder countries that depend on coffee exports. Take East Timor as an example: coffee accounts for more than 90% of its non-oil export earnings, sustaining the livelihoods of 77,000 rural households, and the EU is its largest market. Yet the complex local land tenure, scattered smallholder plots, lack of GPS mapping capacity, and high illiteracy rate make it difficult for the vast majority of coffee farmers to meet compliance requirements. This not only threatens East Timor's coffee industry but could also lead to non-compliant coffee flooding the global market, driving down prices and worsening the plight of smallholders. [more…]

Since the start of spring in September, Brazil's drought and fire situation has not eased but has instead continued to worsen. Multiple cities in Minas Gerais have gone without rain for a long time, and the Bom Despacho waterfall has even dried up; after briefly bringing fires under control, São Paulo state has seen 12 cities hit by fires again, with initial agricultural losses estimated at 2 billion reais. At the same time, large areas of smoke have caused air quality to plummet, and Brazil's meteorological agency has warned that five states will experience "black rain." The number of fires in Rio de Janeiro state has surged by more than 95% year-on-year, and nearly 4,000 cities nationwide face the threat of drought. The Brazilian government has sent a letter to the European Union requesting a postponement of the deforestation-free regulation (EUDR) set to take effect at the end of the year, but international coffee prices are still climbing, and Brazil's coffee industry is deeply worried about production and export prospects for the new crop season. [more…]

Recently, the Ethiopian government, together with the United Nations Development Programme (UNDP), launched a long-term coffee land-use plan with a budget of up to US$20.8 million, aimed at curbing deforestation, promoting the sustainable development of the coffee industry, and helping local coffee comply with the EU Deforestation Regulation (EUDR). The project, named FOLUR, is part of a US$345 million global initiative funded by the Global Environment Facility (GEF) and is planned to run from 2024 to 2031. The project covers 22 districts across four major regions, including Oromia and Sidama, and aims to restore 10,500 hectares of non-productive coffee forests and 60,000 hectares of key forest land, while improving the livelihoods of about 440,000 people. This move is not only related to the lifeline of Ethiopia's coffee exports—which account for 30-35% of its export earnings—but also provides key support for responding to the EUDR regulations that the EU is about to bring into effect. [more…]

The price of US C-type coffee futures once again set a new record, reaching a high of 284.93 cents per pound and finally closing at 279.35 cents per pound. Behind this round of gains is a mix of multiple factors: drought and fires in major South American producing regions, the postponement of the EUDR regulation, the limited effect of Brazil's rainy season, the impact of the Atlantic hurricane season, the strengthening of the US dollar driven by the US election, and the Red Sea crisis together with rising container freight rates. Although the EU has already approved a one-year delay in the implementation of the EUDR, the market's concerns about tight global coffee supply have still not faded, and futures prices are expected to remain high in the short term. [more…]

The Kenya Export Promotion and Branding Agency, in collaboration with the Agriculture Sector Development Agency, is jointly planning to create a unified national coffee brand, aiming to consolidate global marketing resources and enhance the influence of Kenyan coffee in the international market. However, in recent years, the country's coffee production has continued to decline, and export performance has been volatile since 2016. Shrinking cultivation areas, rising production costs, price fluctuations, and unpredictable weather conditions are all constraining industry development. Although the government has implemented reforms to reduce intermediary links through the direct settlement system of the Nairobi Coffee Exchange, tightened processing licenses have led to the closure of large processing plants, with raw materials piling up and even rotting at small factories. Meanwhile, although the EU Deforestation Regulation has been delayed by one year, it still puts considerable pressure on traders and African producing countries. New variables such as the Red Sea crisis, port congestion, and rising domestic consumption have also led Kenyan coffee industry players to place greater expectations on policy. [more…]

After the EU Deforestation Regulation (EUDR) took effect, Costa Rica responded swiftly, launching its first batch of coffee beans compliant with EUDR standards. This batch, totaling 275 bags of 60 kg each, comes from the Tarrazú cooperative, has been successfully sold, and will be shipped to Italy. The initiative, jointly driven by the United Nations Development Programme and the Costa Rican Coffee Institute, is seen as a key step for the country to adapt to climate change and secure its European market. Facing the dual pressures of declining production and competition from neighboring Central American countries, Costa Rica is seeking to boost its industry's competitiveness through green certification. Front Street Coffee continues to follow developments in global coffee-producing regions, bringing first-hand information to enthusiasts. [more…]

Kenya's Supreme Court overturned the Court of Appeal's ruling on August 20, finding the 2023 Finance Act constitutional—a move that had previously sparked large-scale protests in the capital Nairobi and other regions. The act doubles the fuel value-added tax, introduces a housing levy, and raises the top personal income tax rate. The opposition and civil society groups expressed deep disappointment, fearing a further rise in the cost of living. For the coffee industry, the tax increases have pushed up production and transportation costs, squeezing profit margins; more seriously, the EU Deforestation Regulation (EUDR), set to take effect in January 2025, could deal a severe blow to Kenya's coffee exports. Currently, only about 30% to 40% of coffee is certified, while smallholder farmers are generally poorly informed about compliance requirements. Front Street Coffee will continue to monitor developments in the producing regions. [more…]

Recently, Arabica futures have continued to climb, hitting a 13-year high, with Robusta futures closely following, with prices approaching the $5,000 per ton mark. Behind this rally, the reduced coffee output in Vietnam has become a market focus. Although Vietnam's coffee export revenue hit a record high in the 2023/24 season, uncertainty brought by drought, typhoons, and the EU's zero-deforestation regulation is casting a shadow over this globally important Robusta-producing region. This article will review the current state of Vietnam's coffee production and sales, the impact of weather, and the main risks it faces in the future. [more…]

The EU introduced the EU Deforestation Regulation (EUDR) in June this year, strictly prohibiting the sale of commodities linked to deforestation in the EU market, with coffee explicitly included. The regulation requires operators to conduct due diligence on the origin of goods to prove they are not associated with deforestation or forest degradation, or they will face fines or even export bans. The regulation will take effect from the end of 2024 to early 2025, and countries and coffee companies are actively responding. Global coffee giant JDE Peet's recently announced that it has signed memorandums of cooperation on deforestation-free coffee with coffee-producing countries such as Vietnam, Ethiopia, Papua New Guinea, Tanzania, and Uganda, and is using Enveritas' satellite imagery, AI, and on-the-ground verification technology to ensure that coffee does not come from deforested land while protecting the interests of smallholder farmers. This move is highly consistent with the new EU rules and also provides a reference for a sustainable supply chain for brands of interest to coffee enthusiasts, such as Front Street Coffee. [more…]

The Costa Rican coffee industry has recently faced multiple challenges. According to ICAFE data, coffee exports in January fell by 28% year-on-year, and the full-year export forecast has also been revised down by nearly 13%, with adverse weather and a global surplus of Arabica supply both applying pressure. At the same time, the EU Deforestation Regulation (EUDR) has made importers more cautious, adding further uncertainty to the export outlook. To make matters worse, the tap water in the San José area has been contaminated with hydrocarbons, which not only affects residents' health but may also affect the soil and future coffee quality. This article will sort through three threads—the export decline, policy pressure, and the water quality crisis—to help coffee lovers gain a comprehensive understanding of developments in the origin. [more…]

Affected by extreme weather triggered by the El Niño phenomenon, Africa's major coffee-producing regions are undergoing a severe test. As Africa's largest coffee producer, Ethiopia's output for the 2022/23 fiscal year is expected to decline to 7.3 million bags, a decrease of about 1 million bags from previous expectations. The alternating onslaught of drought and floods has not only damaged infrastructure in the producing areas but also driven up transportation costs. At the same time, the European Union Deforestation Regulation (EUDR)'s strict requirements for origin traceability make it difficult for smallholder farmers to comply, forcing export volumes to be revised down by 19%. Shrinking exports, compounded by the impact of the pandemic and civil war, have intensified the country's fiscal pressure, and it even faces the risk of sovereign debt default. International coffee futures prices, meanwhile, continue to fluctuate at high levels due to constrained supply, and market concerns about short-term supply are steadily mounting. [more…]

In response to the strict requirements of the EU Deforestation Regulation (EUDR), the Brazilian Coffee Exporters Council (Cecafe) and the credit company Serasa Experian have jointly launched the Cafes do Brasil platform and held a seminar in São Paulo to help exporters master traceability tools. The platform uses remote sensing technology and geolocation data to dynamically analyze ESG indicators such as forest protection, agricultural cultivation, and deforestation alerts in production areas, ensuring full traceability throughout the coffee supply chain. Among the approximately 100 participants, 41 council members are responsible for about 90% of Brazil's coffee shipments to the EU, and their compliance practices will significantly enhance the transparency and international reputation of Brazilian coffee. [more…]

The Ethiopian federal government has recently deployed approximately 40,000 additional troops to the Amhara region, launching a new large-scale military operation against Fano armed forces. Intense clashes have erupted in multiple areas, disrupting urban transportation and leaving residents trapped in their homes. The conflict has lasted for over a year, causing heavy casualties and severely impacting local agricultural and livestock production as well as logistics and transportation. As a major coffee-producing country in Africa, Ethiopia is facing multiple challenges, including currency depreciation, rising cultivation costs, and compliance pressure from the EU Deforestation Regulation (EUDR). This article will review the latest developments in the conflict and their potential impact on the coffee supply chain. [more…]

The new coffee harvest season in Brazil is accelerating, with both Robusta and Arabica harvest progress outpacing last year's same period, promising to ease the tight global supply situation. Influenced by factors such as reduced production in Vietnam and the Red Sea crisis driving up logistics costs, market demand for Brazilian coffee has surged, and Cecafé expects exports for the 2023/24 season to reach 46.3 million bags, setting a new historical record. Meanwhile, frost warnings are prompting coffee farmers to rush their harvest, and multiple countries are also accelerating shipments before the EU's deforestation regulation takes effect. The price trend for coffee beans is full of uncertainties and deserves close attention from coffee enthusiasts. [more…]

The latest August industry report released by the International Coffee Organization (ICO) shows that the monthly average of the global composite coffee price reached 238.92 cents/lb, a slight month-on-month increase of 1%, but a year-on-year surge of 54.6%, with prices fluctuating between 222.58 and 254.12 cents during the month. Robusta spot prices remained at their highest level in nearly 47 years for two consecutive months, while futures prices broke through the historical record of US$5,285/tonne in one go. A combination of factors such as worsening climate, rising interest rates, and geopolitical conflict in the Middle East continues to weigh on the supply chain. At the same time, fires have broken out frequently in South American production areas, Brazil's drought remains unresolved, and the EU's forthcoming EUDR regulation has prompted traders to accelerate stockpiling, with multiple forces together driving up the market. Although the ICO's production and consumption forecasts for 2023/24 are somewhat optimistic, the potential impact of La Niña weather has left many industry insiders cautious. [more…]