As climate change continues to impact coffee production globally, JDE Peet’s faces significant challenges in the coffee industry. Rising temperatures and unpredictable weather patterns have put pressure on coffee supply chains. For instance, in Vietnam, a severe drought led to a 20% drop in coffee yields during the 2023/24 crop year. In the same way, Brazil, the largest coffee producer, has forecasted a 4.4% production decline in 2025 due to drought and irregular rainfall. This kind of impact highlights the need for adaptation within the supply chain.
JDE Peet’s must consider climate adaptation strategies to combat these challenges. Coffee supply disruptions not only threaten availability but also affect the costs associated with production. Companies like JDE Peet’s are pressured to guarantee their supply chains are resilient. Studies show that improving supply chain resilience can lead to better performance within the coffee sector. Agility and flexibility are essential traits that help companies manage the risks posed by climate change.
The demand for specialty coffee contributes to increased labor and production costs. Farmers must adapt their methods, often using more sustainable techniques, to meet consumer expectations for high-quality, ethical coffee. Such adaptation is crucial as the Coffee Bean Belt directly faces the impacts of climate change. Smallholder farmers, however, face a range of challenges. These include higher costs and the need for training to manage new cultivation requirements effectively.
The introduction of new crops can add risk but may also lead to long-term benefits for supply chain sustainability. As the global coffee market faces volatility, JDE Peet’s must respond effectively. The expectation for a gradual recovery by 2025/26 may offer hope, but achieving supply chain stability is essential. Additionally, global coffee culture has transformed to embrace sustainable farming practices that benefit both producers and consumers alike.
With the world watching, JDE Peet’s has an important role in leading a shift to a more sustainable coffee industry. This will involve adopting regenerative practices that not only improve production resilience but also guarantee a better future for farmers and coffee drinkers alike.
