What are the challenges facing coffee farmers today?

The narrative that high market prices equate to farmer prosperity is a persistent misconception. In reality, the coffee value chain is characterized by a 'margin squeeze' where the rising costs of fertilizers, labor, and climate-adaptation infrastructure outpace the farm-gate price. For the millions of smallholders who produce the majority of the world’s coffee, the mechanism of failure is often a lack of liquidity. Without access to formal credit, farmers cannot invest in the Good Agricultural Practices (GAPs) or disease-resistant varieties necessary to mitigate climate-driven yield losses. This creates a cycle of poverty: low productivity leads to low income, which prevents the reinvestment needed to improve quality or yield. Furthermore, farmers are often geographically and informationally isolated, forcing them to rely on local collectors who capture a significant portion of the value before the coffee even reaches an exporter. This systemic informality leaves farmers without social protections, bargaining power, or the ability to store their harvest to wait for better market conditions. As climate change alters maturation cycles and increases pest pressure, the cost of production rises, yet the farmer remains the only actor in the supply chain who cannot pass these costs on to the next buyer. Consequently, many are diversifying into other crops or exiting the sector entirely, threatening the long-term viability of the global coffee supply.