Today we're talking coffee, cocoa and sugar. In the case of coffee and cocoa, 2025 delivered an extraordinary year: record prices, extreme volatility and sharp market dislocations that caught much of the industry off guard.
But was this turbulence simply the result of tariffs and trade policy? Or does it point to deeper structural shifts in global soft commodity markets, from supply constraints and climate disruption to changing demand dynamics?
Speaking to our host Paul Chapman on this episode is Kona Haque, Head of Research at ED&F Man, one of the world’s largest soft commodity trading houses, which has recently been acquired by Hartree Partners.
Read below for our key talent impacts from this episode.
Key Talent Impacts
Is demand rising for climate-literate commodities professionals in energy and soft commodities markets?
The prolonged supply deficits in coffee and cocoa showed that climate volatility is now a core commercial risk for energy and commodities firms, rather than a peripheral ESG concern. This is driving increased demand for traders, analysts and researchers who can interpret weather patterns, agronomy constraints and long-cycle crop responses, not just short-term price movements.
Are integrated research and trading skillsets becoming more valuable in commodities firms?
Extreme price volatility and multi-year structural shortages reinforced the importance of research-led decision making. Energy and commodities companies increasingly value professionals who can connect market fundamentals, macroeconomic policy, climate risk and positioning, particularly in soft commodities where biological and political constraints limit supply flexibility.
Is risk management and margin discipline talent in higher demand across commodity trading organisations?
Record prices, sharp price swings and widespread margin calls placed significant strain on trading operations. This has increased demand for risk managers, middle-office professionals and commercial leaders with experience managing prolonged stress events, liquidity pressure and counterparty risk in volatile commodities markets.
Is talent pressure increasing across origin-facing and commodity supply chain roles?
Labour shortages at origin, ageing farming populations and declining participation in agricultural work are emerging as long-term structural challenges. As a result, commodities firms are placing greater emphasis on origin-based commercial talent, sustainability specialists and supply chain professionals who can manage farmer relationships, financing structures and long-term supply resilience.
Are policy- and trade-aware leaders becoming strategically essential in energy and commodities markets?
Tariffs and sudden government intervention played a decisive role in amplifying market volatility, particularly in coffee. This is elevating the strategic importance of leaders and analysts who understand trade policy, geopolitics and regulatory risk, and who can anticipate political disruption alongside core market fundamentals.
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Edited highlights and themes from the podcast episode.
Why were coffee and cocoa prices so volatile in 2025?
Coffee and cocoa experienced record prices and extreme volatility in 2025 due to a combination of structural supply deficits and climate disruption. In coffee, the market faced five consecutive years of deficits, driven by droughts, frosts and floods in Brazil and Vietnam. Cocoa suffered from long-term underinvestment, ageing trees and disease in West Africa, particularly in Ivory Coast and Ghana, leading to historically low stocks.
Were tariffs the main cause of the price spikes?
Tariffs amplified volatility, especially in coffee, but they were not the root cause. Supply shortages were already severe before tariffs were introduced. In coffee, US tariffs on Brazilian and Colombian imports intensified scarcity and triggered further price escalation. In cocoa, tariffs had a more limited impact, with prices primarily driven by structural supply issues rather than trade policy.
Why did high prices not immediately ease supply constraints?
Both coffee and cocoa have long production cycles and limited ability to respond quickly to price signals. Coffee trees take several years to mature, while cocoa is largely grown by smallholder farmers with limited capital. In cocoa, government-controlled pricing systems in West Africa meant farmers did not fully benefit from higher global prices, delaying reinvestment and yield recovery.
How did demand respond to record prices?
Demand proved more resilient than expected. Coffee demand remained sticky due to consumer habits and supermarket discounting. In cocoa, demand destruction eventually occurred through shrinkflation, product reformulation and reduced grindings, particularly in Europe. This demand slowdown contributed to a partial easing of prices in late 2025.
Why did sugar avoid similar turmoil?
Sugar benefitted from a faster supply response. High prices encouraged Brazilian producers to shift output from ethanol to sugar, while improved crops in Brazil, India and Europe helped rebuild stocks. As a result, sugar markets moved into surplus, pushing prices lower and limiting volatility.