Bridging the Gap: An Exclusive Dialogue with Vanusia Nogueira on the Global Coffee Crisis and the Path to 2026

From regulatory hurdles like the EUDR to the volatile C-Market and climate resilience, the Director General of the International Coffee Organization (ICO) outlines a strategic roadmap for a fairer global coffee value chain.

Dubai – Ali Alzakary

The International Coffee Organization (ICO) is the primary intergovernmental body dedicated to fostering a sustainable coffee sector. At its helm stands Mrs. Vanusia Nogueira, a visionary leader whose tenure has been defined by a relentless pursuit of equity for smallholder farmers.

This exclusive interview marks a historic moment—the first dialogue granted by the Director General to an Arabic media outlet. We are profoundly grateful to Mrs. Nogueira for graciously accepting our invitation. Beyond her professional stature, her humility and the sincerity with which she approached this conversation were truly remarkable. In an industry often characterized by formal diplomacy, her transparency and candor provided a clear and honest look at the challenges facing our sector. We are deeply indebted to her for her time, her precision, and the kindness she showed throughout this significant exchange.

  • Now that we are well into 2026, how do you personally see the ICO’s role in helping smallholder farmers cope with regulations like the EUDR and other environmental requirements?

The ICO acts as a vital bridge between producing and consuming nations. With 75% to 80% of global coffee producers being smallholders, our role is to make policymakers understand the ground-level challenges. There is often a lot of good intentions behind regulations, but policymakers and consumers are often unaware of how difficult it is to comply in the field. We educate these stakeholders and bring together partners—governments, development agencies, and the industry—to provide the technical and financial support that vulnerable communities need to make these transitions feasible and viable.

  • Traceability and data systems are becoming unavoidable. How can we ensure these costs don’t end up being paid mainly by small farmers?

We are building partnerships with the consuming side—the industry and governments—to support the infrastructure needed, from geolocations to databases. In many countries, the key issue is internal infrastructure, such as internet access. We are working with partners like the German, UK, and Italian governments to implement these systems. Furthermore, we need to educate consumers on why it is fair to pay a little more. Transparency is essential; we must show that these margins are necessary for producers to survive and thrive.

  • Looking back at 2025, has the industry made progress toward a “living income,” or are we still stuck with the C-Market logic?

Vanusia Nogueira: The sector learned in the past two years that a living income is not just about price. It is about closing gaps in productivity, yield, and infrastructure like healthcare and education. While producers in some regions reached a comfortable level last year due to higher prices, others are still struggling. A key solution is for small producers to stop working in isolation; they must organize into cooperatives or associations to access new markets and technical assistance together.

  • Regarding the climate impact on specific origins—in Yemen, for example, the harvest has become fragmented into multiple stages and quantities are dropping. How do you view this?

The situation in Yemen—where you have three or four harvests from the same tree instead of one—is a clear symptom of climate change that we must analyze deeply. We have seen similar shifts in Brazil. We need to understand if the traditional varieties in Yemen—which is one of the original homes of Arabica—are still suitable for this new climate or if we need to renovate the plantations with more resilient strains. Yemen’s heritage is a global priority, and scientists must work to find solutions that protect its unique productivity.

  • There is a growing debate about responsibility. Are large roasters and traders doing enough today?

I see major roasters and traders working very closely with producing countries on “pre-competitive” actions to address these challenges. I am in constant contact with global industry leaders, and I am confident they are totally open to new solutions and are supporting the initiatives needed to stabilize the sector.

  • How should the sector approach lab-grown and alternative coffee products without losing the value of natural coffee?

Vanusia Nogueira: Communication and clarity are paramount. It must be clear to everyone what is “real coffee” and what is a substitute. Natural coffee has scientifically proven health benefits, whereas the impact of chemical or artificial alternatives is often unmentioned. In countries like Brazil and Vietnam, regulations already exist to ensure that packaging for substitutes cannot claim to be “coffee.” We must continue to express why natural coffee remains superior for health and culture.

  • Price swings have been extreme. What is actually driving this volatility?

It is a matter of a “short blanket”—supply and demand. Severe weather events since 2021—frosts in Brazil, droughts in Vietnam and Africa, and typhoons—have lowered production while consumption is surging, particularly in the Middle East and Asia. We are currently working with AI experts to create models that can better predict these events to help us protect production in the short and long term.

  • Markets like the Middle East are now shaping their own identities. How does the ICO plan to engage with them?

The Middle East is a driver of the industry. Saudi Arabia became an official member of the ICO six months ago, and I visited Riyadh recently to touch base with the situation there. I also heard incredible things about the “World of Coffee Dubai” event two weeks ago—people told me it was a truly “crazy” and amazing event. We need to be present in these markets, working as partners to improve communication and support these maturing consumer bases.

  • What role can consumer regions—including the Arab world—play in supporting producers beyond certifications?

The Arab world can play a strategic role as a “catalytic investor.” Beyond labels, their impact lies in investment, partnership, and system-building. They can help de-risk innovation and climate adaptation at the origin. By supporting logistics, research, and digital agriculture, they can help reshape how value and responsibility are shared across the sector.

  • If you could speak directly to the global sector in 2026, what would you say needs to change most urgently?

Vanusia Nogueira: What needs to change most urgently is how risk and value are distributed. Today, smallholders absorb most of the impact of price volatility and climate change. Coffee must be treated not just as a commodity, but as a global public good. If producers earn a prosperous income, the entire sector becomes resilient. That change cannot wait.

  • Editorial Highlights

“Coffee must be treated not just as a commodity, but as a global public good that supports livelihoods, ecosystems, and cultures.”

“Yemen is the cradle of Arabica; we must ensure that its historic coffee heritage survives the challenges of a changing climate.”

“The ‘World of Coffee Dubai’ was an amazing, high-energy event that proved the Arab world is now a central driver of the global coffee industry.”

“A living income is not just about prices—it is about productivity, healthcare, and education. Doubling prices is not enough if the foundation is missing.”

“We must be clear with consumers: natural coffee has scientifically proven health benefits that chemical substitutes simply cannot match.”

“The Arab world has the power to be a ‘catalytic investor,’ moving beyond labels to truly de-risk innovation at the origin.”

 

A New Era for Coffee: The EU-India Free Trade Agreement

By: Fabricio Scocco

After nearly two decades of complex negotiations, we are witnessing a historic milestone. The European Union and India have reached a comprehensive free trade agreement that is set to reshape the landscape of international commerce. By removing up to 90% of tariffs between these two regions, we are opening doors to a combined market of over 2 billion people—an economic powerhouse representing 25% of the global GDP.

For those of us operating within the specialty coffee sector, this development is more than just a policy shift; it is a critical evolution for design-driven, sustainable brands.

  • Redefining the Coffee Supply Chain

The impact on coffee trade and packaging cannot be overstated. The reduction of tariffs on key imports creates a streamlined highway for goods:For India: Exporting green coffee, raw materials, and packaging into the EU will become significantly more efficient due to reduced barriers.For Europe: Companies sourcing or co-producing in India will now have access to smoother, more cost-effective trade lanes.Competitiveness: High-end roasted coffee and innovative packaging solutions will immediately become more competitive on the global stage.

  • Strategic Collaboration and Innovation

We are entering a pivotal moment for strategic partnerships. Consider the existing synergy between We Brand Coffee (INDIA) and Takumi Collective (Netherlands). This agreement validates and accelerates such collaborations where design, sourcing, and packaging flow across borders.

By reducing logistic complexity, we can focus on what truly matters: co-manufacturing opportunities and creating packaging solutions that meet rigorous EU standards while celebrating India’s vibrant specialty coffee scene.

  • Market Outlook and Buying Behavior

As the trade landscape shifts, we anticipate several key trends in buying behavior:Sustainability Focus: Indian packaging providers will likely see a surge in demand from EU brands that prioritize sustainable materials.Exploration of Origin: EU roasters and micro-brands can now explore Indian-origin coffee with significantly less financial risk.Creative Co-development: Branding agencies in both regions will find it easier to co-develop storytelling assets and packaging designs.

  • Navigating the Risks

While the momentum is high, we must remain pragmatic. The agreement still requires official ratification from the EU Parliament and Indian authorities. Furthermore, stakeholders must stay vigilant regarding:Currency and Geopolitics: Short-term cost-benefits may be influenced by FX-driven producer shifts and geopolitical changes.

Regulatory Alignment: Close monitoring of food safety, sustainability criteria, and packaging regulations is essential.Environmental Factors: Unfavorable weather during peak harvest remains a variable that could disrupt supply levels.

  • The Bottom Line

Despite these risks, our market confidence remains medium-to-high. There is a strong mutual interest in diversifying trade and moving away from US-centric dependencies.

This agreement is the foundation for a new phase of commercial and creative cooperation. For those of us building in the coffee world—from bean to brand—this is a unique opportunity to rethink how we work across borders.

Nestlé to Reduce Workforce as Part of Cost-Saving Drive

Dubai – Qahwa World

Nestlé, the Swiss multinational food and beverage corporation, has revealed plans to cut roughly 6% of its global workforce over the next two years as part of a broad efficiency initiative.

Under new CEO Philipp Navratil, the company aims to eliminate about 16,000 positions. Of these, around 12,000 will be in corporate and administrative roles, while the remaining 4,000 will affect manufacturing, logistics, and supply-chain operations.

The job cuts respond to persistent cost pressures and two consecutive quarters of revenue decline. In the first nine months of 2025, Nestlé’s sales fell by 1.9% year-on-year to CHF 65.9 billion ($76.8 billion). Nonetheless, the company credited its coffee and confectionery divisions—underpinned by price increases—for delivering solid growth.

Navratil is pushing to expand Nestlé’s cost-savings target from CHF 2.5 billion to CHF 3 billion by the end of 2027. He described the cuts as “hard but necessary,” noting that while Nestlé’s size offers advantages, it also brings complexity and inefficiencies that must be addressed.

According to the company, the planned reductions in corporate staffing are expected to yield approximately CHF 1 billion in annual savings. Efficiency drives in the production and supply chain segments are intended to support further cost mitigation through automation and operational consolidation.

While Nestlé’s nutrition segment and operations in China were among the weaker performers, the coffee segment showed resilience—even as commodity prices remained elevated and consumer spending softened in many markets.

In particular, the company implemented an average price increase of 7.4% across key coffee and confectionery brands such as Nescafé and Nespresso—moves that helped support growth across all regions. Nestlé also reported strong momentum in its ready-to-drink and coffee concentrate lines, especially in Asian and Oceanic markets.

The decision to downsize globally underscores the intense cost pressures faced by one of the world’s largest food and beverage companies. Even strong-performing sectors like coffee could not completely offset rising production and raw-material expenses, particularly for green coffee and cocoa.

In the coffee commodities market, both Arabica and Robusta prices remain at historically high levels. In September 2025, Arabica futures exceeded $4 per pound for the first time since April, while Robusta prices hovered near $5,694 per tonne—strained by adverse weather, reduced yields in Brazil and Vietnam, and continued supply chain disruptions.

The Cocoa Paradox: How Global Shocks and Dubai’s Trade Ambitions Are Reshaping a $26 Billion Industry

Dubai – Qahwa World

The global cocoa industry long synonymous with indulgence and luxury is undergoing a historic transformation. A sharp supply crunch, climate disruptions, and tightening regulations have exposed deep structural weaknesses in one of the world’s most beloved commodities. Yet, amid the volatility, new opportunities for diversification, innovation, and fairer value distribution are emerging with Dubai positioning itself as a strategic bridge between producers and consumers in the new era of cocoa trade.

The Dubai Multi Commodities Centre (DMCC) has released a comprehensive report titled “The Future of Trade Special Cocoa Edition,” part of its Agri Commodities Series. The report examines the global cocoa market’s critical challenges from production shortages and price volatility to digital innovation, ethical sourcing, and shifting consumer demand toward wellness and sustainability. This news story is based on the key findings of the DMCC report, one of the most detailed and forward-looking analyses of the cocoa sector and Dubai’s growing role in it.

A Crisis of Supply and Unequal Returns

The global cocoa market is valued at around US$16.6 billion in 2025 and is expected to reach US$26.2 billion by 2035. However, behind this growth lies a deep imbalance. The 2023/24 crop year recorded one of the steepest production declines in decades down 13% to 4.4 million tonnes resulting in a deficit of nearly half a million tonnes and pushing prices to record highs. Cocoa grindings also fell by 5% to 4.8 million tonnes, according to the International Cocoa Organization (ICCO).

The roots of the crisis lie in West Africa, which produces over 60% of the world’s cocoa from Côte d’Ivoire, Ghana, Nigeria, and Cameroon. Devastating outbreaks of black pod and swollen shoot disease, erratic rainfall, and ageing trees have crippled production. Ghana’s regulator has already warned that output could drop another 10% in the 2025/26 season.

“Our cocoa plantations are ageing and have suffered from years of underinvestment,” says Kwadwo Boachie-Adjei, founder of Kumbi Cocoa. “Farmers lack access to quality fertilizers and seedlings because the financial resources needed to reinvest in their communities have not been flowing back at the scale required. The cycle of low productivity and limited incomes must change.”

Despite record-high international prices, farmers in Ghana and Côte d’Ivoire still receive fixed farmgate rates set by governments too low to cover replanting or disease control. “For every one-dollar chocolate bar, farmers receive just two cents,” notes Mauro Danilo Ribezzi, founder of the Ribezzi Group. “The economics of cocoa are fragile people will simply walk away.”

Meanwhile, processors and brands are struggling with soaring energy, transport, and financing costs. Companies are resorting to shrinkflation and reformulation: Mars Inc. cut 10 grams from its Galaxy bar, while Nestlé dropped the word “chocolate” from some UK products that now fall below the 20% cocoa-content threshold.

Although chocolate still dominates around 85% of cocoa demand, consumer preferences are shifting toward functional, ethical, and health-oriented products. The premium chocolate market is projected to grow from US$31.9 billion in 2024 to US$40.6 billion by 2030, while demand for raw cacao marketed as a superfood rich in antioxidants is forecast to surge from US$14.3 billion in 2024 to US$23.6 billion by 2033. Cocoa butter, a staple in cosmetics and pharmaceuticals, is set to nearly double in value to US$9.37 billion by 2032.

At the same time, the industry faces new compliance pressures. The European Union’s Deforestation-Free Products Regulation and Corporate Sustainability Due Diligence Directive require companies to prove that their cocoa is not sourced from deforested areas and that human rights are upheld throughout supply chains. Cocoa cultivation has caused over 37% forest loss in Côte d’Ivoire’s protected areas and 13% in Ghana, making traceability and digital monitoring essential for market access and premium pricing.

Dubai: A New Global Nexus for Cocoa Trade

Amid these structural pressures, Dubai is emerging as a stabilizing force in global commodity flows. Leveraging its strategic location between Africa, Asia, and Europe, the UAE has built a resilient trade ecosystem capable of absorbing global shocks. According to the DMCC report, the UAE imported US$17.3 million worth of cocoa beans in 2023 96% of which came from Côte d’Ivoire and exported US$16.4 million, mainly to Iran, Malaysia, and Saudi Arabia. While modest compared to European hubs, these figures highlight Dubai’s growing relevance in both upstream and downstream cocoa trade.

Building on the success of the DMCC Coffee Centre and Tea Centre, Dubai is now planning to launch a DMCC Cacao Centre that will offer integrated services including grading, blending, storage, branding, and structured trade finance all under one roof. The initiative aims to transform Dubai into a full-service hub for cocoa trade and value addition in the Middle East.

“The DMCC provides African producers with what they have long lacked direct access to markets and capital,” says Boachie-Adjei.

“The beauty of the DMCC ecosystem,” adds Ribezzi, “is that we don’t just operate as traders but as facilitators connecting farmers, financiers, and buyers across borders.”

The report also underscores how technology is redefining cocoa trade. Blockchain-enabled traceability ensures regulatory compliance and transparency, while mobile-first fintech platforms allow farmers to receive payments directly cutting out intermediaries and ensuring faster, fairer compensation. Emerging models such as tokenized assets and decentralized finance (DeFi) could soon unlock new credit channels for smallholders historically excluded from the banking system.

Looking further ahead, the industry is experimenting with lab-grown cocoa to overcome climate and disease risks. Startups are cultivating cocoa cells that yield mass without farms, a concept already supported by major players such as Barry Callebaut and Japan’s Meiji. Other innovators are developing cocoa-free chocolate alternatives using ingredients like carob and upcycled fibers to reduce dependency on volatile bean supply. Meanwhile, West African research programs are advancing disease-resistant and high-yield varieties through genetic innovation and agroforestry models.

The DMCC report concludes that the future of cocoa rests on five pillars: climate-adapted farming, transparent supply chains, diversified production, financial innovation, and equitable participation. It calls for producer nations to move beyond being raw suppliers and instead become true partners in global value creation.

With its neutral trade infrastructure and forward-looking policies, Dubai is poised to redefine the cocoa economy shifting it from a system marked by inequality and volatility to one built on sustainability, inclusivity, and shared prosperity.