Demand for coffee is outpacing supply.

By Danica Lo
Updated May 24, 2017
© Getty Images/iStockphoto

If you seriously rely on your morning cup of joe, brace yourself: the world may be facing an increase in coffee prices as demand outpaces supply. Who is to blame? Mother Nature and millennials, of course.

According to a new report, the ongoing drought in Brazil and record-breaking demand for coffee, especially among top-consuming millennials, means prices are bound to soar. "Consumption is rising as supplies are getting tighter," according to Bloomberg "Dry weather in Brazil has hampered the country's crop of robusta coffee, the bitter-tasting beans used in instant coffee." Roasters are turning to smoother arabica beans, pushing the price for this Starbucks-favored bean up too.

Brazil, which produces 30 percent of the world's coffee crop, has suffered drought for years. "Generally the drought has decreased production and quality and it's expected to be worse as time goes on because of the effects of climate change," Coffee Review Sensory Analyst Jason Sarley told Vice earlier this year. "The issue along with that is that we have this massive increased global demand for very good coffee, but on the production side they're struggling."

On the demand side in the U.S., which is the world's top coffee market, millennials are consuming nearly half (44 percent) of all coffee in this country. While older Americans have cut back on their coffee consumption—"Adults 60 and older saw a drop to 64 percent from 76 percent, and there was also a decline for the 40-to-59 age group," Bloomberg reports—young people have amped up their intake. The National Coffee Association reports that: "In the eight years through 2016, daily consumption among 18- to 24-years-olds rose to 48 percent from 34 percent, while it climbed to 60 percent from 51 percent among those aged 25 to 39."

What can we do about dwindling coffee supplies? Probably not too much in the short term, but the threat to your latte should be a wake up call if you're not already taking climate change seriously.

"Many countries where coffee exports form a main plank of the economy are also amongst the most vulnerable to climate risk," cites one recently released report by the Climate Institute, a non-profit organization based in Australia. "Honduras, Nicaragua, Vietnam, and Guatemala, for instance, rank in the top-10 for climate-related damages since the 1990s."

The organization recommends letting your money do the talking.

"For coffee drinkers keen to help, the first step is to learn about the challenges faced by coffee producers and communities, and about what organizations such as Fairtrade and others are doing to make a difference," the report says. "Next, most consumers can now choose brands that are carbon neutral, guarantee a fair return to smallholder farmers and their communities, and help them build their capacity to adapt to climate change. Finally, people can demand action from all companies and their governments to ensure all products, businesses, and economies are carbon neutral or better."