Frozen Coffee – It’s Not What You Think

Jul 27, 2021

Iced coffee picked up a new meaning last week, and not in a good way.

Early in the morning on July 20, air temperatures across Brazil’s coffee belt settled at an icy 29 degrees Fahrenheit. That’s the coldest temperature the region has seen since 1994.

And just like chocolate milk does not come from brown cows, frozen coffee plants do not make iced coffee.

Farmers are still assessing the extent of the damage, but early indications are not good. One estimate pegs the damage at 4.5M bags off the 70M bag projection for 2022 exports. But the full impact won’t be known until farmers are able to determine if the plants can be saved or not.

Get in line: Like the Starbucks drive-through, the line of challenges stacked against Brazilian coffee farmers is long. Before the frost, drought conditions plagued this year’s growing season, and futures prices were already high. Following the frost, prices surged another 13%.

Dark roast coming? The coming months will be mega important to the cost of your caffeine habit. Forecasters are predicting a return of La Niña. AKA more drought.

If the forecasts come to fruition, count on prices to keep rising.