Coffee prices are booming right now. Arabica coffee on the futures market has consistently hovered at or above the $3.50 per pound mark since the beginning of the year, and in Ethiopia, this has produced record-breaking revenue for the country.
As reported by Semafor, Ethiopian coffee exports have earned $1.87 billion in revenue over the last 10 months, exceeding the country’s target by 142%.
The reasons for the record reflect coffee’s position as a global commodity. One of the main factors, per the article, is the lower output this by Brazil, the world’s leader in Arabica production. This has allowed other countries, like Ethiopia, to fill in the gaps, which has been especially beneficial with the elevated C-Market price.
But there are domestic factors contributing as well, including the Ethiopian government increasing its support of smallholder coffee farmers via “supply inputs, state-of-the-art irrigation systems, and better infrastructure.”
Meanwhile, one of the biggest unknowns in the future of the coffee trade come from the on-again off-again tariffs from the US government. But even these look favorable for Ethiopia. America is the world’s largest consumer of coffee, and the government has levied higher tariffs on other producing countries—like a near 50% tariff on Vietnam—that could push more buyers to Ethiopian coffee, which generally fetches a higher price, but will end up being cheaper overall due to their lower tariff rate.
But there are issues to navigate ahead for Ethiopia. The European Union, for instance, has passed regulations banning the import of commodities linked to deforestation that require producers to prove their crops aren’t contributing to the practice. This requires additional technology and infrastructure that many Ethiopian farmers don’t have access to, which could mitigate their ability to sell coffee to the EU. They have until June 2026 to implement the mechanisms to track and prove their crops aren’t from deforested land.
Still, it’s been a banner year for Ethiopian coffee production. And when the past five or so years have seen farmers across the globe abandon or consider abandoning coffee growing in favor of more profitable crops, it’s a positive turn for the future of coffee.
Zac Cadwalader is the managing editor at Sprudge Media Network and a staff writer based in Dallas. Read more Zac Cadwalader on Sprudge.