Arabica coffee futures prices saw a significant drop this Friday. On December 10, the opening price of Arabica coffee futures at the Intercontinental Exchange (ICE) in the United States was 235.00 cents per pound, closing at 233.08 cents per pound, a decline of 2.96%.

This drop in Arabica futures prices also marks the largest decline since July, easing pressure on some buyers.

Analysts at Fitch Solutions stated that most agricultural product prices are expected to decline next year, but will still remain at relatively high levels. Due to the higher price levels this year, crop planting and production have been stimulated, and crop yields are expected to increase next year.

In addition, according to data from industry organization Abic, due to the surge in Arabica futures prices, Brazil’s coffee bean sales in November dropped by 14% compared to the previous month, while retail coffee sales last month rose by 40%.

Due to inflationary pressures, consumers are spending more on staple foods and are forced to remove coffee from their shopping lists. Such a decline in consumption due to significant price increases is common. According to Bloomberg, coffee prices in New York have nearly doubled over the past year, attributed to extreme climate changes causing poor coffee harvests in Brazil and shipping constraints hindering coffee deliveries worldwide.

Data from Cepea, a research institute at the University of São Paulo, shows that the price gap between Robusta and Arabica widened to its largest level since 2011 last month. Although transportation disruptions and delayed deliveries from Vietnamese Robusta suppliers pushed up Robusta futures prices, the increase in Robusta prices was not as sharp as that of Arabica. With Robusta-producing regions in Brazil not being affected by the severe weather that impacted Arabica regions, the outlook for Robusta is relatively more optimistic.

In Brazil, the price of high-quality Arabica coffee beans has surged nearly 140% this year, while lower-grade Robusta coffee beans have seen prices roughly double. Even so, due to rising production costs, some roasters have begun substituting Arabica beans with Robusta beans. However, as the proportion of Robusta increases, the taste of the coffee changes noticeably.