Coffee price rises almost 35% in one year; climate and dollar drive high

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The price of coffee has increased by 34.53% in the country in the last 12 months, according to the IPCA (Extended Consumer Price Index). The drink is part of the daily life of Brazilians and is the second most consumed here, second only to water.

Several factors contribute to this increase. With the real devalued, for example, it is more interesting for foreign countries to buy Brazilian products, which are cheaper. This leads to a reduction in supply in the country.

A second factor was the drought that mainly affected the Triângulo Mineiro region in the first quarter of the year. The water crisis impacts on energy generation and, consequently, on grain production.

Frosts in southern Brazil also contributed to the rise. In August, they affected coffee plantations and caused a reduction in the supply of the product, as part of the production was affected.

In addition, some of the products that are used in coffee production, such as inputs and fertilizers, are quoted in dollars. In other words, this rise in the US currency ends up increasing the cost for the producer.

Reference: CNN Brasil

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