Introduction:Coffee production in Costa Rica has fallen to its lowest level in decades, with an estimated 1.185 million bags for the 2024/25 season — a figure that approaches historic lows. This article delves into the multiple reasons behind this sharp decline, from abnormal weather patterns and currency fluctuations to labor shortages. It explores how these factors impact coffee quality and the global supply chain, while also providing practical background knowledge to help coffee enthusiasts better understand the challenges facing specialty coffee-growing regions.
The Costa Rican coffee industry is going through one of its most difficult periods in decades. According to the latest report from the U.S. Department of Agriculture, the country’s coffee output for the 2024/25 season is projected to be just 1.185 million bags (each bag weighing 60 kilograms). Although this figure is not much different from the 2023/24 season, it represents a dramatic 66% drop compared to the 3.5 million bags produced in the 1990s — nearly hitting an all-time low. This sharp decline reflects the long-term and complex challenges facing coffee cultivation in the country.
Growers are currently under significant financial pressure due to high debt levels, the continued appreciation of the Costa Rican colón against the U.S. dollar, low international coffee prices, and reduced market demand. Under the combined influence of these factors, many coffee farmers have been forced to reduce fertilizer use, lower application frequency, or even postpone plans to replace disease-resistant, high-yield coffee varieties — further affecting future yields and quality.
Moreover, worsening climatic conditions have had a direct impact on coffee production. The Costa Rican Coffee Institute (ICAFE) had previously predicted that the 2023/24 coffee harvest could reach 1.44 million bags, but actual output fell by 16%, ending at just 1.18 million bags. The main causes were the early arrival of the rainy season in March 2023, frequent heavy rainfall, and the high temperatures and humidity brought about by the El Niño phenomenon. These factors led to poor coffee cherry development, increased fungal diseases, and higher drying costs during the harvest period due to damp conditions, all of which affected the final coffee quality.
In addition to natural conditions, human resources and logistics also face serious challenges. In 2023, large-scale government protests erupted in Panama, with roadblocks and demonstrations lasting several weeks, disrupting transportation routes and affecting the efficiency of coffee bean distribution. At the same time, a significant northward migration of Nicaraguan immigrants has led to labor shortages during the coffee harvesting season. Coupled with limited availability of coffee harvesting machinery, the harvesting process has become even more difficult, further driving down overall production.
On the export front, coffee exports from Costa Rica for the 2024/25 season are expected to total only 975,000 bags. Although this shows a slight increase compared to the 2023/24 season, it remains 3% lower than the 2022/23 season. The primary reasons are the overall reduction in production and the slower pace of global coffee sales. The continued appreciation of the Costa Rican colón has made coffee export prices relatively higher when denominated in U.S. dollars, further weakening competitiveness in the international market. Many exporters have adopted more conservative export strategies as a result, posing a risk of further declines in export volumes.
The currency issue has sparked strong dissatisfaction across multiple industries in Costa Rica. In mid-May of this year, representatives from the coffee and fruit growing sectors, as well as those from tourism, transportation, and service industries, gathered in front of the Central Bank (BCCR) and finance ministry buildings to stage large-scale protest marches. They demanded that the government address the severe economic losses caused by its exchange rate policies. With the colón reaching its highest level against the U.S. dollar in 10 years, producers have suffered losses amounting to millions of dollars. Some exporters have stated that for every 1-cent drop in the U.S. dollar exchange rate, the funds available for paying wages decrease by 50 to 100 colones. In economically fragile rural areas, such currency fluctuations have already led to widespread job losses — a worrying situation.
The industry has widely called on the government to pay attention to and intervene in the currency market to stabilize the exchange rate, thereby protecting the survival and development of multiple domestic industries. If the currency issue continues to worsen, it will not only further impact coffee exports but may also trigger broader social problems, ultimately harming the livelihoods of ordinary citizens. For coffee enthusiasts, understanding the challenges behind these producing regions can help foster a deeper appreciation for every cup of specialty coffee from Costa Rica.
The above content is compiled by CoffeeHunters, a coffee news website.
