Coffee prices have surged to multi-year highs amid a convergence of global supply headwinds

• Coffee prices have surged to multi-year highs amid a convergence of global supply headwinds, Bloomberg reported.
• Arabica coffee hit a seven-year high on Thursday due to low inventories in warehouses monitored by ICE Futures US.
• Raw sugar also saw its price scale to its highest level in a month on Thursday.

Coffee prices have surged to multi-year highs amid a convergence of global supply headwinds.

According to Bloomberg, Arabica coffee hit a seven-year high on Thursday due to low inventories in warehouses monitored by ICE Futures US, the main exchange for coffee futures. Prices have pared some of those gains on Friday. Robusta coffee also slipped slightly Friday. Raw sugar also saw its price scale to its highest level in a month on Thursday, though was trading about 1% lower on Friday.

Prices for coffee and sugar have rallied this year on numerous factors, but mainly due to the drought in Brazil, the world's largest coffee producer. In July this year, the region's rainy season hardly saw any rainfall during one of its worst droughts in almost a century, hurting the 2021 crop and dropping the coffee supply output in Brazil as plants withered.

The shortage was exacerbated by the supply chain disruptions that have wreaked havoc on global production and distribution of various commodities from lumber to oil