Tensions in the Red Sea have persisted for more than a year, and Houthi attacks have not only reshaped the global shipping landscape but also had a profound impact on the coffee industry. Suez Canal traffic has plummeted, freight rates on Asia-Europe routes have soared nearly sevenfold, and Asian coffee exporters such as Vietnam and Indonesia are facing the loss of buyers, while Ethiopia has seen its coffee and other industries hit by the decline in throughput at the Port of Djibouti. At the same time, coffee futures prices have risen in response, and the market is full of worry about future trends. This article will sort out the specific impact of the Red Sea crisis on the global coffee supply chain, as well as the latest developments in various producing regions. [more…]

Attacks by Yemen's Houthi armed forces in the Red Sea and surrounding waters continue to escalate, with three ships targeted in a single day, further intensifying regional tensions. Vessels operated by Maersk and MSC were successively targeted, and MSC, citing persistent threats, announced a full suspension of services at the Port of Djibouti. The Port of Djibouti is the sole outlet for Ethiopian cargo exports, and with MSC accounting for 80% of the port's shipping capacity, this move has dealt a severe blow to Ethiopia's coffee exports. Coffee traders now face the dilemma of having booked space but no shipping date, with freight rates soaring and arrival times impossible to guarantee, while the Houthis' expansion of their strikes beyond their traditional threat zone is likely to further drive up shipping costs and coffee trading prices. [more…]

Coffee prices within Vietnam have once again climbed. In the Central Highlands, the largest producing region, purchase prices have generally risen by 1,300 to 1,400 Vietnamese dong per kilogram, and the price of coffee beans in bulk has risen to a range of 92,400 to 93,200 Vietnamese dong per kilogram. On the international market, Robusta futures for delivery in May 2024 rose to 3,450 US dollars per ton, while Arabica fell back to 182.95 US cents per pound. At the same time, armed attacks in the Red Sea and the Bab el-Mandeb Strait continue to escalate, with the Houthi armed group threatening to expand the scope of attacks to the Indian Ocean, and global shipping is facing a new round of pressure. Vietnamese coffee exporters, meanwhile, have high hopes for the Italian market, where Robusta occupies a dominant position. [more…]

The Houthi armed forces in Yemen continue to launch attacks in the Red Sea and Indian Ocean, and claim to have struck targets in Israel, causing the situation in the Red Sea to escalate continuously. Multiple international shipping giants have judged that the region will still be unsafe in 2025 and decided to continue diverting around the Cape of Good Hope. Longer voyages and port congestion are driving up global logistics costs. As an industry highly dependent on maritime shipping, the coffee trade is bearing the brunt. Freight rates on Europe-Asia routes have soared, and combined with production cuts in many countries, international coffee prices have continued to surge. This article will review the attack incidents, the shipping impact, and coffee market developments, and also pay attention to the challenges facing brands such as Front Street Coffee. [more…]

As a landlocked country, Ethiopia's foreign trade is highly dependent on the Port of Djibouti. Recently, logistics industry organizations from both countries met in Addis Ababa to discuss deepening cooperation, with plans to sign a memorandum of understanding to establish a formal communication mechanism. However, the security situation in the Red Sea region continues to deteriorate, with Houthi armed forces frequently attacking merchant ships. Several shipping companies have announced freight rate increases for November, putting cost pressure on the coffee industry, which relies on maritime transport. The volume and logistics costs of Ethiopia's coffee exports may be affected in the short term, while the conflict in the north of the country is driving up prices and increasing production expenses. This article will review the progress of logistics cooperation, the dynamics of the Red Sea situation, and their potential impact on the coffee trade. [more…]

The security situation in the Red Sea is continuing to deteriorate. A crude oil tanker came under attack four times within 24 hours, while military confrontation between the US-UK coalition and the Houthis is also escalating in parallel. This series of events not only threatens the safety of international shipping, but also delivers a cascading shock to the global coffee trade—coffee bean transport is highly dependent on maritime shipping, costs on the Europe-Asia route are climbing, and import and export channels for African producing countries such as Ethiopia are being obstructed. Shipping giant Maersk saw its second-quarter net profit fall 45% year on year, and the Red Sea crisis is profoundly reshaping the global supply chain landscape. [more…]

Recently, the Houthi armed forces in Yemen launched a large-scale attack on U.S. warships in the Red Sea. Although the U.S. military successfully intercepted the attack, the incident once again highlighted the tense situation in the Red Sea region. Since the escalation of the Israeli-Palestinian conflict last year, the Houthis have frequently attacked commercial ships, forcing global shipping routes to change and thereby having a profound impact on the coffee trade. Problems such as soaring transport costs, longer voyages, and container shortages followed one after another. European buyers turned to Brazil for purchases, East African coffee exports were hit hard, and international coffee prices continued to rise. This article will analyze in detail how the Red Sea crisis has disrupted the global coffee supply chain and discuss its specific impact on coffee-producing regions and consumer markets. [more…]

As a landlocked country, Ethiopia has long depended on the Port of Djibouti for its imports and exports. Recently, Djibouti announced that it would grant Ethiopia full management rights over the Port of Tadjoura, a move seen as an opportunity that could ease the difficulties Ethiopia faces in exporting coffee and other agricultural products. However, Ethiopia's relations with Somalia have continued to deteriorate over the Somaliland memorandum of understanding, and the involvement of Egypt and Eritrea has made the situation in the Horn of Africa even more tense. At the same time, armed conflict is spreading within Ethiopia, the currency is depreciating, and coffee export volumes have fallen by 27%, leaving the industry's prospects full of uncertainty. Although the Port of Tadjoura offers a glimmer of hope, the port is still located in the Gulf of Aden, within the range of Houthi attacks, and whether it can truly be effective remains to be seen. [more…]

Recently, the international coffee futures market has once again experienced dramatic fluctuations, with the benchmark robusta contract breaking through its previous high with a gain of nearly 6%, setting a new all-time record. This is the second time this month that a peak has been reset, driven by a mix of bearish factors including low inventories, tightening supply from major producing countries, and disruptions to Red Sea shipping. Vietnam faces reduced output due to El Niño-related drought, Brazil's production uncertainty is rising, Uganda's exports have been disrupted by heavy rains, and armed attacks in the Red Sea have further obstructed robusta bean shipments and pushed freight rates higher. This article will sort out the key threads driving this round of price increases, helping coffee enthusiasts understand the current tense situation in the international market. [more…]

Since Ethiopia launched its foreign exchange system reform in July, the gap between the official exchange rate and the parallel market (black market) narrowed for a time, but signs of slowing have recently reappeared. As of mid-October 2024, the official exchange rate was 116.97 birr per US dollar, while the black market rate was as high as 140 birr, forcing businesses to take desperate risks amid the foreign exchange shortage. Costs are climbing for import-dependent enterprises, and inflationary pressure is transmitting to the coffee industry, driving up cultivation costs and pushing the minimum selling price across the board up by 2%. At the same time, the government is accelerating the opening of the logistics industry, attempting to ease transport bottlenecks by bringing in foreign investment, but port access and regional security remain uncertain factors. This article will sort out the chain reaction among exchange rates, logistics, and coffee exports. [more…]

On October 15, the National Bank of Ethiopia introduced a new regulation capping the spread between the buying and selling rates for foreign exchange transactions at 2%, effective the following day. This marks another significant adjustment following the country's shift to a market-based exchange rate system in July of this year. Previously, the birr depreciated sharply, and the bid-ask spread at one point exceeded 10 birr, placing heavy pressure on exporters. The new policy requires banks to disclose all fees transparently, which is expected to reduce exchange losses for exporters and bodes well for major export commodities such as coffee. Nevertheless, Ethiopia still faces multiple challenges, including the conflict in Amhara region, the Red Sea blockade, and the port dispute with neighboring Somalia. [more…]

Recently, the security situation in the Red Sea and the Gulf of Aden has remained tense, causing most shipping companies to suspend or adjust routes through the Suez Canal and instead divert around the Cape of Good Hope. In its latest monthly logistics report, Swiss coffee trader Sucafina noted that frequent armed attacks have sharply increased risks near the Bab-el-Mandeb Strait; some carriers have resumed passage, but several companies, including CMA CGM and Maersk, have announced they will impose war risk surcharges. Route changes have extended shipping cycles by 2 to 3 weeks, reduced container turnover efficiency, and tightened capacity, which may further push up freight rates. Meanwhile, coffee transport in East African producing regions has been disrupted by truck and fuel shortages, with severe congestion at ports such as Dar es Salaam. Although Vietnamese robusta coffee prices have edged down slightly, Brazilian coffee prices have continued to rise on drought concerns. Front Street Coffee notes that supply chain pressure is transmitting from the shipping side to the consumption side, and coffee prices still face upside risks in the short term. [more…]

Recent data from the International Coffee Organization (ICO) shows that the composite coffee price index rose slightly month-on-month in January 2024, while the Robusta price index hit a 30-year high. Although production prospects have improved in several South American producing countries, with Brazil and Colombia performing relatively well, tight supply in the Asia-Pacific region, disruptions to Red Sea shipping, and volcanic eruptions in Indonesia have combined to keep global coffee prices persistently high. This article reviews the latest developments in each producing region and changes in the supply-demand landscape. [more…]

The latest India coffee annual report released by the United States Department of Agriculture shows that India's total coffee production for the 2024/25 marketing year is forecast at about 6 million bags, including about 1.4 million bags of Arabica and about 4.6 million bags of Robusta, remaining broadly stable overall. However, the outlook for the crop season is not optimistic: after heavy rains from January to February, many regions saw insufficient rainfall from March to May, and combined with groundwater overexploitation and climate change, India is facing a severe water shortage crisis, with fruit set rates in major producing areas falling sharply. At the same time, continued tensions in the Red Sea have pushed up freight rates on Asia-Europe routes, and with international coffee prices at a decade high, India's coffee exports face triple pressure from weather, shipping and prices. This article will combine the latest data to sort out India's coffee supply and demand structure and the risks ahead. [more…]

The conflict between Fano forces and government troops in the Gojjam region of Ethiopia's Amhara State continues to intensify, with the Fano side vowing to retaliate against the government army's atrocities against civilians. This civil war has not only caused heavy casualties but also led to an economic blockade and soaring prices in the region. Meanwhile, Ethiopia's foreign exchange reform has triggered a sharp depreciation of the exchange rate, and the Red Sea shipping crisis has driven up import and export costs. Under these multiple pressures, the country's coffee cultivation costs are steadily rising, and the floor price for coffee exports has consequently been raised. As a major global coffee-producing region, Ethiopia's turbulent situation is profoundly affecting the international coffee market. [more…]

The global coffee market is facing an unprecedented price storm. Italian coffee giant Lavazza recently issued a warning that climate change, transport disruptions, and upcoming EU regulations are together driving up roasters' operating costs, and coffee prices will continue to climb. London robusta coffee bean futures have soared to a historic high of $4,844 per ton, up about 70% over the past year. Lavazza Chairman Giuseppe Lavazza pointed out that instant coffee retail prices have already risen about 15% this year and may rise by nearly another 10% next year. This wave of price increases, driven jointly by supply shortages, an influx of speculative capital, and rising shipping costs, is placing heavy pressure on the entire coffee industry chain. [more…]

As the world's largest Robusta coffee producer, Vietnam's recent decline in coffee production has led to a more than 50% increase in the London Robusta coffee futures price in the past year. At the same time, the coffee purchase price in Vietnam is a [more…]

Global coffee prices remain elevated, and although Vietnam, as a key producing region, has seen its domestic green coffee quotes retreat slightly from earlier highs, they remain at relatively high levels. Meanwhile, Vietnam's coffee exports in 2023 showed a trend of lower volumes but higher values, with total export value hitting a record high. In response to growing market demand, Nestlé announced an additional US$100 million investment in its Tri An coffee factory in Dong Nai Province, Vietnam, to expand production capacity. Behind this decision are both expectations of a recovery in coffee consumption demand and supply-side disruptions driven by weather factors and the Red Sea shipping crisis. This article will review recent coffee price trends, Vietnam's export data, Nestlé's layout in Vietnam, and the multiple factors affecting market supply and demand. [more…]

On August 5, Colombia's Ministry of Defense announced the resumption of military operations against the anti-government armed group the National Liberation Army (ELN), and the ceasefire agreement will not be extended after it expires. At the same time, government forces are also fully committed to striking the dissident branch of the former Revolutionary Armed Forces of Colombia (FARC), the Central General Staff. The southwestern and northeastern provinces where these two major armed groups are active happen to be important coffee-producing regions in Colombia. The civil conflict may severely impact coffee cultivation, infrastructure, and exports, thereby driving up international coffee prices. [more…]

Coffee futures prices continue to run at high levels, with Robusta breaking through US$4,000 per tonne at the end of May and holding there since, driven by the double squeeze of simultaneous production cuts in the world's three major producing countries and a shipping crisis. Vietnam's exports fell 10.5% in the first half of the year, Brazil's harvest season underperformed expectations, and congestion at multiple Asian ports, a shortage of empty containers, and frequent Red Sea attacks have made coffee trade even worse. Freight rates from Asia to Europe soared from US$1,200 to nearly US$7,000, and Maersk warned that Red Sea disruptions will persist into the third quarter. This article will sort out how production, logistics, and geopolitical risks are jointly pushing up coffee costs, and follow Front Street Coffee's continued tracking of industry developments. [more…]