Navigating Unprecedented Volatility
The coffee market is experiencing unparalleled volatility, presenting significant challenges for roasters and the broader coffee industry. At Black Baza, we believe in transparency and want to keep you informed about how these changes are impacting our business and pricing strategy.
Coffee Markets in 2025
Coffee prices have surged to levels not seen in decades, with the market currently sitting at $3.24 per pound, approaching the historic high of $3.30 from 1997. This rapid price increase is driven by a range of global factors:
Changing Climate Impacts in Brazil and Vietnam:
El Niño impacts in Brazil, such as lower-than-average rainfall and higher temperatures, have resulted in crop damage, affecting the world's largest coffee producer. Similar weather patterns in Vietnam are causing similar disruptions, leading to lower output projections for both countries. These factors are contributing to record-high prices and ongoing volatility in the coffee market.
EUDR Deforestation Ordinance:
The EU's Deforestation Regulation aims to prevent commodities, including coffee, from being linked to deforestation after December 31, 2020. While this is a positive step toward sustainability, the effectiveness of its enforcement and monitoring is still up for debate. Despite the benefits, it does create disruptions in global supply chains and introduces new compliance challenges, even for countries not directly exporting to the EU.
US Tariffs:
US tariff measures have already affected coffee-exporting countries like Vietnam, with other nations expected to face similar impacts soon. These tariffs add to the volatility of the coffee market, as trade barriers can disrupt supply chains, raising prices and further complicating global coffee dynamics. The ongoing trade tensions highlight how tariffs can significantly affect coffee prices and market stability worldwide.
Additional Pressures:
Rising shipping costs, growing global coffee consumption, speculative investments, political instability and war in coffee-producing and consuming countries are further compounding the situation.
Impact on Coffee Producers
In response to the market instability, many producers are adjusting by limiting or defaulting on long-term contracts and selling at higher market rates. While these elevated prices may offer profitability for some farmers, there’s no certainty on how long these conditions will persist.
On the ground, many smallholder coffee producers are facing confusion, as traders create a false sense of urgency by declaring high market rates without following through. Some are also purchasing wet coffee without properly weighing the lots in front of the producers. This lack of transparency creates room for exploitation, leaving farmers vulnerable to unfair practices in an already unstable market.
Black Baza’s Approach
For us at Black Baza, this volatility requires a flexible approach, but one that remains firmly rooted in strong relationships with both our customers and producers. We are committed to prioritising quality and sustainability, which means maintaining our buy-back guarantee—we purchase coffee from all our partner producers, regardless of price. In a market like this, where reference prices are volatile, our consistent purchases ensure that producers can rely on us, even when others hesitate.
In most landscapes, we set the benchmark for fair prices. When we don’t buy, producers lose the ability to negotiate effectively with us and other traders.
Commitment to Stable Pricing
At Black Baza, we have only raised prices thrice in the last 8 years, with the most recent adjustment in June 2024. It is always our goal to limit the fluctuations in pricing changes to minimise the impact on our customers while ensuring the sustainability of our operations.
In 2025, we aim to:
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Ensure access to premium coffee through proactive purchasing strategies that do not compromise on ecological sustainability, traceability or quality
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Maintain transparent communication with you about pricing changes and their underlying causes.
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Support our producer partners during this challenging period.
As the founder of Black Baza, I’ve always believed that our strength lies in the relationships we build—whether with our producers, customers, or within our team. In times of uncertainty, it’s these connections that guide us forward. Our commitment to sustainability and transparency isn’t just a business model; it’s a reflection of the values that drive me personally and the team behind Black Baza.
While the volatility in the coffee market presents challenges, it also reinforces our mission: to create a fairer, more sustainable industry for everyone involved. We’re here to navigate these changes with you.
Stay tuned for further updates as we continue to monitor the market and adapt our strategies to meet the evolving landscape. If you have any questions about the coffee pricing market and how it may impact your coffee needs, please reach out to me directly by email.
Thank you for your continued partnership and trust in Black Baza. We remain committed to walking this path with you.
With gratitude,
Arshiya
Founder, Black Baza Coffee
[arshiyabose@blackbazacoffee.com]
Additional Resources:
Global Coffee Prices Soar To Record Highs Amid Supply Constraints, Rising Demand
Coffee's record highs continue as it approaches $4 per lb
Coffee prices reach all time high: ICO report
Arabica futures are over US $4.30/lb: It’s a new era for coffee
India's coffee output dips, clouds export outlook despite record prices
Adverse climatic conditions drive coffee prices to highest level in years
Adverse weather drives nearly 40% rise in coffee prices in 2024