Kochi: In a significant relief for India’s coffee growers, coffee prices are expected to rise further due to production declines in leading producers like Brazil and Vietnam. This development is seen as beneficial for farmers in Karnataka and Kerala, the top coffee-producing states in India. It is after 15 years that coffee farmers are witnessing such favourable prices.

Brazil, the largest coffee producer globally, is currently grappling with a severe drought, which has significantly affected its coffee production. Similarly, adverse weather conditions have reduced coffee output in Vietnam, Mexico, and Colombia, causing a notable decrease in global coffee availability.

Brazil mainly produces Arabica coffee, but due to the smaller size of Arabica plants, they are highly susceptible to climate fluctuations. The combined impact of drought and the El Niño phenomenon has put Brazil's coffee production under immense strain. Leading global coffee trader ‘Volcafe’ has revised its estimates for Brazil's Arabica production for the 2025-26 season to 344 lakh bags, each weighing 60 kilograms. This is a reduction of 110 lakh bags compared to the estimate made in September, marking a nearly 25% decrease in production. As a result, reports suggest that global production may fall short of meeting the demand for the 2025-26 season.

For the 2024-25 season, Brazil's Arabica coffee production is estimated at 433 lakh bags, which is still insufficient to meet global demand. The surge in demand during Christmas and New Year celebrations is also expected to contribute to rising coffee prices, as winter typically sees a spike in consumption.

While the reduction in global production has pushed coffee prices upward, the decline in availability poses challenges for farmers as well. Traders in Kerala report a shortage of coffee, despite the attractive prices. In Kerala, coffee production has dropped by around 40%, causing concern among farmers. Currently, in Central Kerala, the price for raw Robusta coffee is Rs 60 per kilogram, while hulled coffee beans are priced at Rs 225 per kilogram, and coffee berries fetch Rs 390 per kilogram.

Arabica coffee production in Kerala is minimal, and while Karnataka has a larger share of cultivation, farmers there too are affected by adverse climate changes.