The Modern Coffee Crisis

The world entered a “coffee crisis” at the dawn of the twenty-first century, with the worst and most prolonged bust cycle in history. From 1962 to 1989, the United States was a signatory to the International Coffee Agreement, a quota system that, while unsatisfactory and often violated by smugglers, helped stabilize the price of coffee. With the Cold War ending, the United States pulled out of the agreement, and it collapsed, along with coffee prices.

In the 1990s, Vietnam—which had never been a major player—began growing a great deal of cheap robusta and, in the process, dispossessed and persecuted the indigenous Montagnards in the central highlands of the country. By 2000, Vietnam had surpassed Colombia to become the world’s second-largest coffee producer. As a result of this oversupply, coffee prices dropped well below the cost of production, with resulting dislocations and starvation throughout coffee-growing regions during the “Coffee Crisis” of 2001–2003.