CAIRO • The crisis in the Suez Canal could soon hit the supply of instant coffee to Europe.
The vessel blocking one of the world's most important maritime passages is curbing not only shipments of crude oil and liquefied natural gas, but also containers of robusta coffee - the type used to make Nescafe.
All of the beans from East Africa and Asia - which houses two of the world's top robusta producers - flow to Europe via the Suez.
Only two major robusta coffee producers - Brazil and Ivory Coast - do not use this key route to reach major consumers in Europe.
Coffee roasters in Europe had already been struggling to get robusta coffee from Vietnam, the world's largest producer, because of a shortage of shipping containers that has upended global food trade.
Just when the availability of containers started improving, the canal blockage brought another headache.
Some of Europe's coffee roasters recently turned to supplies from East Africa to bridge the shortfall of robusta beans from Vietnam. As a result, traders have seen more demand for beans from Uganda or the milder-tasting arabica beans from other East African nations. But those beans also travel via the Suez.
Traders who have them stored in European warehouses are charging a hefty premium in the physical market.
At the peak of the container squeeze, traders were demanding US$450 (S$606) a tonne above the exchange price for Vietnamese coffee held in Europe, three times the normal rate.
Replacing Vietnamese coffee with Brazilian beans would also change the taste of the final product for consumers. East African beans are a better replacement.
"Will roasters change their recipes?" asked Ms Raphaelle Hemmerlin, head of logistics at Swiss coffee trader Sucafina. "It is not so simple."
BLOOMBERG