Coffee prices - coffee on the stock exchange

Coffee as a commodity on the stock exchange

Coffee is the world's second most consumed beverage after water – and, in terms of value, the second most important commodity after crude oil. Among the most important trading venues are the New York Board of Trade (NYBOT) and the London International Financial Futures Exchange (LIFFE).

Fluctuating prices

Despite numerous efforts by various stakeholders, the price of coffee is subject to strong fluctuations, which are mainly influenced by natural factors.

Due to the labor-intensive cultivation process, it is difficult to respond to peak demand – several years pass between planting and the first harvest. Consequently, prices rise if supply cannot keep pace.

One indicator of this interplay between supply and demand is the four exchanges where coffee is currently traded. The Robusta exchange on London's Euronext and the Arabica exchange on the New York Trade Board are particularly important. Here, not only are traditional exchange transactions conducted, but also futures contracts for large quantities of coffee beans, where traders speculate on future price movements.

For many smaller buyers – especially roasters – these exchanges, where only standard-quality coffees are traded, serve more as a price barometer. This is because the diversity of coffees is enormous: quality, origin, growing conditions, environmental factors, transport costs, and currency fluctuations all further influence the price.

Those who place particular emphasis on quality often buy directly from producers or intermediaries in order to agree on fair and transparent prices.

Control and regulation

To avoid artificially induced price fluctuations, trade agreements, regulatory bodies, and stock exchange institutions were created. Today, the International Coffee Organization (ICO) the leading authority in this field. It monitors compliance with strict hygiene and environmental standards and mediates between the 77 countries that currently import and export coffee.

👉 Learn more about the ICO