Summary: Coffee is hot right now - not only in temperature but also in price movements. Learn why coffee prices are rising and how this affects both consumers and traders as we explore the intricate balance of supply, demand, and market dynamics.
What’s causing coffee futures prices to go up? A key reason for the change, particularly for the robusta bean mostly grown in Southeast Asia, is that Vietnam faced a tough drought last year. This didn't just affect coffee prices but also pushed up the price of sugar. Due to this, there was less coffee produced, but people still wanted their coffee. This mismatch between demand and supply is pushing prices higher – a common situation in markets.
As coffee prices go up, different people are affected in different ways. For those who enjoy a daily coffee, the good news is that the cost of coffee beans is only a small part of the price we pay for a cup. Therefore, consumers won’t feel a direct impact from this when they visit their local coffee shop.
For traders, it's a big deal. The price of coffee beans has jumped by 60% over the last year, which has a big impact on the market and creates new opportunities for trading. Traders should be watching these price changes closely, as there is a lot of movement in the market, and therefore a lot more opportunities.
Quarterly Outlook
Global Head of Macro Strategy
Quarterly Outlook
Global Head of Macro Strategy
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Commodity Strategy
Quarterly Outlook
Global Head of Macro Strategy
Quarterly Outlook
Head of Fixed Income Strategy
Quarterly Outlook
Chief Investment Strategist
Quarterly Outlook
Head of Commodity Strategy
Quarterly Outlook
Chief Investment Strategist
Disclaimer
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)