Coffee Prices Likely to Rise Further... Global Coffee Stocks at Lowest in 22 Years

ICE Futures Exchange Coffee Futures Price 1-Year Trend [Image source= Bloomberg]

[Asia Economy Reporter Byunghee Park] Global Arabica coffee bean inventories have dropped to their lowest level in over 20 years, signaling a potential further increase in coffee prices.

According to statistics released on the 7th (local time) by the U.S. ICE Futures Exchange, Arabica coffee bean inventories fell to 143 million pounds, marking the lowest level since February 2000, Bloomberg reported on the same day.

Inventories tracked by ICE have been declining continuously since September last year.

This is due to poor harvests in Brazil, the world's largest coffee producer and exporter, caused by weather conditions, as well as a significant rise in transportation costs.

Fernando Maximiliano, an analyst at financial firm StoneX, explained, "Due to expensive transportation costs, Brazilian coffee producers find it more advantageous to sell domestically rather than paying high transportation fees to deliver coffee to ICE."

Analyst Maximiliano added, "The low inventories at the ICE exchange are one of the factors contributing to the rise in coffee prices."

Arabica coffee bean futures prices surged 76% last year, reaching their highest level in a decade due to poor Brazilian crop conditions, and have continued to rise this year.

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