You may also like our article on how record coffee prices don\u2019t necessarily make producers price makers<\/a>.<\/p>\n One of the major challenges posed by higher coffee prices is volatility. For coffee producers, this makes income unpredictable and financial planning extremely difficult.<\/p>\n \u201cIn August 2025, the price variance between the highest and lowest points within the month was 40%,\u201d says Jorge Cuevas<\/a>, Chief Coffee Officer at Sustainable Harvest Coffee<\/a>. \u201cImagine trying to run the family budget, let alone the business of growing coffee, when your income can vary by up to 40% in a single month.\u201d<\/p>\n Timing also matters. Coffee is often purchased from farmers months before export contracts are finalised. During that window, global prices and foreign exchange rates can shift dramatically.<\/p>\n \u201cChristopher Feran recently pointed out<\/a> that cherry price and FX rate must also be considered. In Ethiopia last year, for example, coffee cherries were purchased from October to January, while contracts were registered from December to March,\u201d explains Kosta Kallivrousis<\/a>, Senior Supply Chain Advisor at Age of Coffee<\/a>. \u201cThe difference between these two time periods is almost US$2\/lb. The FX rate lost value over this time period, making the amount paid to farmers even less.\u201d<\/p>\n At the same time, production costs are increasing. Fertiliser prices have risen, labour shortages persist, and climate volatility has made coffee production more expensive and risky. In many regions, higher farmgate prices are largely offset by these growing costs.<\/p>\n Producing high-quality coffee requires additional labour, time, and infrastructure. Selective harvesting and careful processing both involve higher risk and upfront investment.<\/p>\n Historically, producers have pursued quality differentiation when commodity prices were low.<\/p>\n \u201cThe vast majority of coffee farmers look to differentiated markets as a way to escape coffee pricing that won\u2019t pay above the cost of production,\u201d Kosta explains.<\/p>\n So when market prices are high, that incentive often disappears. Producers can earn strong returns by quickly selling commercial-grade coffee, without the uncertainty associated with experimental processing and micro lots.<\/p>\n When producers expect prices to fall again, many prioritise short-term financial security over long-term investment. \u201cThey look to cash in quickly because they know, historically, a period of higher prices won\u2019t last long,\u201d Kosta adds. \u201cIronically, a high-priced market is historically terrible for incentivising and supporting quality coffee.\u201d<\/p>\n High prices also influence buyer behaviour. Specialty green coffee traders and roasters, facing higher baseline costs, are increasingly cautious about paying additional premiums.<\/p>\n \u201cSince prices are so high, some specialty buyers are lowering their quality expectations,\u201d says Neil Oney<\/a>, Green Coffee Quality Manager at StoneX Coffee<\/a>. \u201cMany, but not all, are less likely to spend extra on micro lots when they\u2019re spending micro lot prices on blenders.\u201d<\/p>\n Consumer behaviour changes, too. Data indicates that when the C market is high, and roasters raise their prices, consumers tend to purchase lower-quality coffee<\/a>.\u00a0<\/p>\n Kosta also cites the example of trade prices during the pandemic. The Sustainable Coffee Transaction Guide<\/a> reported a 20% decrease in higher-quality specialty coffees (84+ points) and a 17% increase in regular specialty coffees (80-83 points).<\/p>\n When commercial-grade coffees can sell for over US$4lb \u2013 similar to what specialty-grade micro lots achieved in some markets only a year earlier \u2013 the financial reward for producing exceptional coffee becomes marginal. This shift risks flattening quality differentiation across the market.<\/p>\n The C price has fallen from record highs in recent weeks. illycaff\u00e8 predicts that it will stabilise between US$2.80 and US$3\/lb in the second half of 2026, although this remains above the average of the past five years.<\/p>\n Rabobank also reports that political instability between the US and South America could push prices higher. The recent US military operation in Venezuela has drawn criticism from Brazilian President Lula and Colombian President Petro<\/a>, which could disrupt coffee trade between the countries. The reinstatement of tariffs, including the previous 50% on Brazil, could be disastrous.<\/p>\n With prices expected to remain volatile in the foreseeable future, many argue that stability, not short-term gains, should be the priority. Longer-term contracts, relationship-based sourcing, and transparent discussions of production costs are increasingly seen as ways to reduce supply chain risk.<\/p>\n \u201cThis requires honest conversations about what benefits each party. It requires listening to what people want versus what they need,\u201d Kosta explains. \u201cProducers\u2019 and roasters\u2019 realities might be worlds apart, but are united through coffee. Having flexible, long-term commitments is one way to mitigate the crushing volatility everyone is experiencing. It can balance the highs and lows experienced, rather than capitalising on each other\u2019s unfortunate circumstances.\u00a0<\/p>\n \u201cThe great news about the specialty coffee trade is that we can make up different rules if we want.\u201d<\/p>\n Greater alignment among producers, traders, and roasters could help smooth volatility, protect quality, and ensure that higher prices translate into sustainable outcomes rather than short-lived windfalls.<\/p>\n \u201cOpen communication and engagement across the supply chain is key,\u201d Jorge says. \u201cUnderstanding the cost of production and jointly working towards reflecting the proper value for each coffee is paramount.\u201d<\/p>\n There are also calls for buyers to assume greater risk, particularly when requesting experimentally processed coffees or micro lots. Committing to purchase these coffees, even if outcomes are uncertain, could help restore incentives for high-quality development.<\/p>\n \u201cBuy them even if they don\u2019t turn out as expected,\u201d Neil says. \u201cProducers take a lot of risk with experimental processing, and they shouldn\u2019t have to when it\u2019s your product and at your request.\u201d<\/p>\n The specialty coffee industry has long positioned itself as distinct from the commodity market, built on quality, transparency, and shared value. Sustained high prices threaten to blur that divide<\/a>.<\/p>\n Higher prices alone won\u2019t guarantee better coffee. Without coordinated approaches that balance risk, reward, and investment in quality, the market can drift toward standardisation.<\/p>\n Enjoyed this? Then read our article on what\u2019s next after high coffee prices<\/a>.<\/p>\n Photo credits: Sustainable Harvest<\/a><\/p>\n Perfect Daily Grind<\/p>\n Want to read more articles like this? 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