Coffee Prices Soar — So Why Are Yunnan’s Coffee Farmers Still Worried?

If you visit Pu’er in Yunnan this spring, you will find all the coffee farmers beaming with joy — green coffee bean prices have been climbing for a full year now, surging from ¥38/kg at the start of 2024 to ¥66/kg by May this year, a rate of increase outstripping even that of gold.

◉ The coffee boom sweeping across China in recent years has drawn ever more young people up into the mountains to visit the estates. Coffee farms here in Pu’er have also been developing hands-on workshops in coffee knowledge and guided tasting experiences. A member of staff walks guests through the transformation from a single seed to a finished cup of coffee.
Yet the rise in coffee prices has nothing to do with local growing conditions in Pu’er or across Yunnan. Whether Pu’er’s coffee harvest is bountiful or lean has no bearing on green bean prices — coffee is a globally priced commodity. This current surge stems from massive production cuts in South America, the world’s leading coffee-growing region: Brazil’s output fell far short of the expected 66.4 million bags, reaching only 54.21 million bags.

Yunnan’s coffee has thus been swept along by roller-coaster price swings purely “passively”. As recently as 2018, green coffee beans had just hit an all-time low of ¥13/kg, yet just seven years later, by May this year, prices had surged to ¥66/kg — a new record high.

For an ordinary coffee farmer living in Pu’er, Yunnan, the price of coffee — a primary agricultural product — is impossible to predict. Who could have foreseen that, barely five or six years ago, coffee was a cash crop that lost money, worth less even than rubber or rice?

I. Yunnan Coffee Breaks Free of Its Low-Price Past

Coffee, a foreign import, first reached Yunnan in China by way of French missionaries travelling on the Yunnan–Vietnam Railway at the close of the nineteenth century. Commercial-scale coffee cultivation in Pu’er City began in the 1950s.

At one point, coffee cherry prices in Yunnan were so low that they barely covered the actual labour costs of cultivation and harvesting. To offset the financial losses from low purchase prices, some farmers resorted to unscrupulous means to inflate the weight — mixing pebbles or sand into the cherries, for instance, or soaking, even injecting, them with water before selling.

◉ The processing steps that turn coffee cherries into green beans; in the end, only roasting transforms them into roasted beans. From a primary agricultural product to the cup at our lips lies a complex chain of steps: cultivation, harvesting, sorting, post-harvest processing (divided into different methods — washed, natural, honey, semi-washed and anaerobic fermentation), roasting, grinding, and extraction or brewing. Image source: Xiaohongshu @画啥

Shifting demand in domestic and overseas markets, combined with volatile weather, affects both the quality and yield of coffee, causing the purchase prices of Yunnan coffee cherries to fluctuate frequently — at times even exhibiting what is called “a different price every single day”. When prices look promising, farmers will demand inflated prices on the spot at the cherry trading market. On one hand, this is the farmers’ pushback against having no bargaining power of their own; on the other, it only deepens the disorder in the trading market.

Because coffee prices had languished for so long, farmers’ willingness to plant was dealt a severe blow. In many villages across Pu’er, young people abandoned their family coffee plots and headed to Pu’er city or the provincial capital, Kunming, to earn wages for the household. When the cherries ripened, there were not enough hands in the village, and no one picked them. Chen Si, a coffee farmer from Laoxuzhai in Manlian Village, Nanping Town, Simao District, Pu’er, recalled: “When coffee bean prices are low, hiring workers to pick the cherries means losing money — you would be better off letting the beans rot on the ground.”

In 2010, fuelled by surging international futures prices, the purchase price of Yunnan green coffee beans shot up to ¥41/kg, with profit margins exceeding 200% — a record high. This ignited a coffee boom in Pu’er, and that same year the region’s planted area exceeded 300,000 mu (roughly 20,000 hectares), vaulting Pu’er to the top of Yunnan’s production rankings.

Chen Si remembers that when coffee prices first dropped, local farmers simply tore out their coffee trees and planted tea instead. Then, as prices climbed, everyone scrambled to switch back to coffee — those who had left to work elsewhere came home, and even property developers sold up their buildings to plant coffee.

◉ A tea table in a coffee farmer’s home reflects Pu’er locals’ long-standing love of tea. Since coffee arrived, a set of coffee-brewing equipment has been added alongside it. This has given rise to a curious sight: the farmers themselves drink tea, yet they brew coffee for guests visiting from elsewhere; once conversation warms, they will simply invite the guest to brew their own coffee. Though they grow coffee, most of these farmers are still neither skilled at brewing it nor accustomed to drinking it.

II. Actively Tackling Price Volatility

Brother He joined the industry right in the thick of this coffee boom. Before he started planting coffee in 2010, he had been a local truck driver in Pu’er, frequently hauling timber up and down the hills near the coffee estates. At the age of forty-six, when the timber mill where he worked shut its doors, he set about forging a new path and chanced upon the surge in coffee prices: “Back then, driving timber down the mountains, I would often see the forecourts of roadside processing plants crammed with lorries buying up coffee beans.”

Well acquainted with the terrain and climate of the hills, Brother He sought out a valley in Manxieba Village, Nanping Town, Simao District. At the hilltop stood a collective forest serving a water-conservation role; the Qingshui River followed the slope down into the valley, and even under the fiercest blazing sun one could feel the coolness of the ravine. Brother He took on over fifty mu (roughly 3.3 hectares) in one go, stretching from the mid-slope to the valley floor, and signed a fifty-year lease. He built a house in the valley, grew vegetables, relied on solar power for electricity, and raised chickens and geese under the canopy while building a pigsty alongside his coffee — the whole enterprise has since become a self-sufficient ecosystem. Thanks to the valley’s microclimate and the nourishment of farmyard manure, Brother He’s coffee trees have always thrived.

◉ The Qingshui Hejia Coffee Estate in Manxieba Village, Nanping Town, Simao District, Pu’er City, appears from a distance to be encircled by verdant hills; beyond sight, the Qingshui River murmurs quietly on its course — a true feng shui gem for growing coffee.

But the volatile coffee prices kept outpacing Brother He’s plans. From 2018, coffee prices plunged again, with Yunnan green coffee bean prices hovering between ¥13 and ¥15/kg — even below the cost of growing and harvesting. Many farmers felled their coffee trees, replanting with tea bushes or fruit trees, or simply leaving the land to go fallow, drastically reducing Yunnan’s coffee planted area. At the same time, speculative capital pulled out, and young people headed back to the cities for work, leaving their family coffee plots behind with virtually no maintenance.

It was not until 2021, when demand for coffee began to recover, that prices finally rebounded. Meanwhile, droughts, frost, pests and diseases battered the world’s leading coffee-producing regions — Brazil and Vietnam among them — driving down yields and pushing prices higher. The average price of Yunnan green coffee beans climbed from ¥15/kg in 2018 to ¥29/kg by the end of 2021. Exacerbated by extreme weather, price volatility in 2024 grew even sharper; by this year, Yunnan green coffee bean prices have surged past ¥60/kg.

Yet the coffee farmers of Pu’er are no passive bystanders either. Everyone is trying all manner of ways to raise both the quality and the price of their beans.

One approach is to take on value-added processing themselves.

In recent years, Brother He and his wife have begun processing their own washed coffee beans. After more than a decade working with coffee, he can now gauge the drying level of the beans simply by taste and the feel between his teeth.

For the same batch of coffee cherries, if Brother He sells them raw, the purchase price is only ¥8–10/kg. But when he processes them himself using the natural and washed methods, the resulting green coffee beans can fetch ¥40–50/kg.

◉ December 2024, in the thick of the coffee harvest season: partly processed coffee beans are drying in Brother He’s yard. His customers have already placed orders for these green beans before processing is even complete.
These days, Brother He can grade and price his green beans himself according to quality, and the prices he commands are far more reasonable.

The washed coffee beans from Brother He’s estate are now ordered directly by coffee trading companies and neighbourhood cafés in Shanghai. Owners of other coffee estates also buy washed coffee beans from him in bulk for further processing and final roasting. “Coffee’s in great demand right now,” says Brother He. “They’re planning to sell my coffee to America.”

The era of rock-bottom prices for Yunnan coffee is over, at least for now. But like growing regions abroad, Yunnan’s coffee belt has been hit by natural disasters on more than one occasion. Facing such challenges, what can Yunnan’s coffee farmers do to prepare in advance?

III. Exploring the Ecological Transition

Some coffee farmers have already begun cultivating sustainably to brace themselves against extreme weather.

Three years ago, Ziling and Xiao Houzi, founders of the LOHAS Community Lab, arrived in Pu’er, and climate change soon became a thorny challenge laid squarely before them.

Coffee trees flower at the onset of the rainy season; the bloom is brief, lasting typically only two to three days. Once the blossoms fall, the trees set fruit, and when the rains end, the harvest of ripe cherries begins.

They have found that in recent years Pu’er’s climate has grown unpredictable, with extreme weather events becoming frequent, while the coffee tree’s growth cycle is highly sensitive to rainfall. Over the past three years, the first rains of each year in Pu’er have come earlier each time — last year shifting from March–May to February–March — causing the trees to flower prematurely. Yet the rain has been erratic, and those early buds often dry out and die in March and April, sharply reducing fruit-set. This year, after the rainy season officially arrived in late May, the sheer volume and duration of the rain meant some coffee trees’ lateral branches could no longer bear the weight of the fruit and had to be propped up with poles to prevent breakage.

At the LOHAS Community Lab, Ziling and Xiao Houzi have been experimenting in test plots on a coffee estate, planting comfrey, mung bean, marigold, ryegrass, Sudan grass, October green bean, lablab bean and orchard grass. They sow these in the rainy season and cut them down when the dry season arrives, using the cuttings as green manure to cover the soil and enrich it for the coffee trees. This green manure can replace chemical fertiliser, improving soil quality, strengthening the trees, and making them more resilient to climate change.

◉ Left: the LOHAS Community Lab’s coffee trial plot, where green manure has all but carpeted the soil in a riot of life. Right: the conventional control plot, bare and barren after hand-weeding.

Yet the shift in Pu’er’s rainfall patterns has also disrupted their green manure programme. In May 2023 the rains were late, and what awaited the seedlings was over a month of drought. By the time the rain finally came at the end of June, the green manure had been wiped out entirely. The first year’s plan ended in failure; fortunately, weeds grew up in the plots and could be cut for ground cover, though the nutrient value fell far short of expectations.

◉ In May 2023 — a month that should have been squarely in the rainy season — all Ziling and Xiao Houzi got was a single downpour lasting fifteen minutes. Turning the soil, they found only the surface layer damp. “Not even the top two centimetres below were wet.” Photo: Xiao Houzi

Climate change brings more than erratic rainfall for coffee farmers. Heat and drought can also cause massive crop losses. A few years ago, Chen Si began intercropping and relay intercropping fruit trees among his coffee rows as shade trees. During dry spells and heatwaves, these trees cool the farmland, shielding the coffee from sunscald. It gives the trees an extra layer of protection against disease and disaster while boosting biodiversity on the farm. Besides coffee, he also grows over ten mu of terrace-planted tea bushes.

Liao Xiugui, now in his eighties, was once an agricultural technician who has been guiding farmers in Pu’er to grow coffee since the 1980s and founded the Xiao’aozi Estate. He believes a stable microclimate and ecologically sound cultivation can also elevate coffee quality. He plants shade trees on the estate’s higher ground, lets grass grow and mulch the soil in the hollows, and returns coffee pulp to the land as fertiliser, using deep ploughing to improve the soil. “For over twenty years, the estate has never used chemical herbicides, and pest control is done entirely by hand. Walking through the grounds, you can hear insects singing and birds calling everywhere. We’ve had two dry years, but we’re not worried — the ecosystem is well established, so the land’s drought resistance and water-holding capacity are strong. The flavour of our coffee beans has actually become more pronounced.”

◉ The Xiao’aozi Estate, now designated a Specialty Coffee Standardised Planting Demonstration Base. From cherry harvesting to green-bean grading, fermentation, roasting into roasted beans and final packaging into products, everything is completed on-site.

Of course, there are simpler methods too: many farmers lay plastic mulch film over the soil to retain moisture during droughts. But Ziling thinks this does nothing to address soil and water erosion and only adds plastic pollution — by no means a long-term solution.

Wide swathes of monoculture, bare-soil planting, heavy use of chemical fertilisers, pesticides and herbicides, and plastic mulch film — these are the practices that currently appear to offer the best cost–benefit ratio. Yet experience has long shown that the coffee tree, a perennial woody crop with exacting demands on flavour, may not sustain long-term health under such short-term fixes. Some experts, civil-society organisations and farmers have begun exploring more environmentally friendly, more ecologically attuned methods of growing coffee.

After three straight years of setbacks and exploration, Ziling feels that coffee cultivation today offers neither fully controllable techniques nor fixed timing benchmarks; every attempt still feels like blind men examining an elephant. They plan to install weather stations on the trial and control plots of a coffee estate to monitor rainfall, air humidity, temperature and soil moisture conditions. In parallel, they will sow green manure seeds a full month before the rainy season begins, to see whether the fluctuation in morning and evening temperature and humidity might encourage earlier germination. They are also adjusting the timing and type of fertiliser applications to strengthen nutrient supply at the critical stages of the coffee trees’ flowering and fruiting period.

◉ On 20 April 2025, Ziling installs and calibrates the weather station’s monitoring functions in the coffee control plot. Photo: Xiao Houzi

IV. Who Will Accompany Yunnan Coffee Farmers on Their Specialty Coffee Journey?

Faced with the shifting tides of both market and climate, the sustainable future of Yunnan’s specialty coffee still lies a long way off. For farmers hoping to claim their share of the specialty coffee value chain, exploring climate-adaptive cultivation methods, keeping the fruit-bearing trees healthy, and securing a more stable and reasonable price for their coffee all matter enormously — yet none of these are goals that a single household, or farmers acting alone, can achieve.

How might research, markets, and policy step in to help coffee farmers better weather the challenges of climate and trade? Foodthink will continue to follow Yunnan’s coffee industry and the stories of its farmers.

Foodthink Contributor

Mei Ying

An apprentice of Jiangnan’s single-pot noodles, a Yunnanese in spirit on the move.

 

 

 

 

All images taken by the author unless otherwise noted

Editors: Auntie Xiong, Xiaodan