As a result of the worst drought Brazil has seen in six decades, the price of coffee beans has reached a two-year high. The devastating combination of dryness and high temperatures has destroyed crop yields. Brazil and coffee lovers around the world are bracing for what’s next.
While the high prices make coffee drinkers cringe, there may be a silver lining for coffee growers. According to some analysts, the high prices may be enough to offset the growers’ output losses and give them enough cash to prepare for harvesting. Even if coffee growers are able to come out ahead by the end of this year, no one knows for sure what will happen next year.
The Delicate Arabica Bean
Brazil produces one third of the coffee that’s drunk around the world. And it all comes from the delicate Arabica bean. The lineage of every Arabica bean grown in Brazil can be traced back to the highlands of Ethiopia. They produce a coffee that is loved around the world because they have a softer, sweeter taste than other strains of coffee beans.
Climate Change and Coffee Prices
Mauricio Galindo of the International Coffee Organization is concerned about global warming. He believes that climate change is the biggest threat to the coffee industry and warns that the industry must prepare itself or face a “big disaster.”
Also, in its April 2014 report, the Intergovernmental Panel on Climate Change named global warming as one of the contributors to the rising cost of coffee. The world’s preeminent climate science group projects that a small 2 °C to 2.5 °C increase in temperature will result in a drastic reduction in the land area in Brazil and other countries that is suitable for coffee production by 2050.
The group also projects that a rise of 3 °C would cut the area suitable for production by two-thirds in Brazil’s main growing states of Minas Gerais and São Paulo, while possibly eliminating coffee crops entirely in other areas. Such a dramatic reduction in crops would change the face of Brazil’s agriculture industry.
The Drought Affects More Than Coffee Lovers
While many farmers may be able to recover their crop losses thanks to higher prices, the future of the world’s coffee supply is still uncertain. Some industry analysts suggest that the world prepare itself for “new normal prices.”
But if the drought continues much longer, Brazil’s other cash crops could be in jeopardy. Hilton Silveira Pinto of EMBRAPA, Brazil’s government agency for agriculture, believes that Brazil’s soybean, corn, cassava, and other crops may also suffer significant losses.