MIAMI – As one of the largest green coffee bean buyers in the United States, the J.M. Smucker Co. is keenly focused on the market and market conditions. During a March 11 presentation at the Bank of America Consumer and Retail conference, executives from the company outlined how they are navigating market volatility this year.

The good news is ICE Futures US New York arabica coffee futures prices the week of March 17 remained well below record highs set in February. But a lack of clarity about crop conditions in Brazil, the world’s largest coffee producer, continues to be a challenge for buyers.

“We continue to navigate an inflationary environment with green coffee,” said Tucker Marshall, chief financial officer at Orrville, Ohio-based J.M. Smucker Co. “We took two significant price increases in this fiscal year. And as we think about next fiscal year, we will have to take additional pricing actions to recover green coffee costs. And our strategy has always been that we will recover the cost for the dollar cost inflation.

“So, for next fiscal year, you can probably expect some net pricing growth at the top line, but we are going to see an impact at the volume level just because of the associated price (versus demand) factor.”

Mark Smucker, chairman of the board, president and chief executive officer, said the structure of global coffee production is a limiting factor.

“(Brazil) is the only country that has large-scale farms that have mechanical harvesting,” he said. “Everywhere else in the world is all generally small farms. About a hectare is kind of an average, they’re very small, and everything is hand harvested. And, so, it’s a very manual crop. The supply chain is very long.”

Smucker added that during the winter months there was a lot of speculative activity in the market that was not driven by fundamentals.

Drinking coffee at home remains the category’s largest usage occasions.

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“We’re starting to get into a period as the harvest is coming in or where fundamentals theoretically drive more of the markets, the market pricing,” he said. “But because it’s such a long supply chain, it’s hard to read.

“So, we are waiting to see how the crop continues to come in. Some of the mixed signals that we were getting around the crop are obviously led by Brazil, and those signals were they got the rain that they needed but the rain came too late.”

Despite the volatility, Smucker said at-home coffee consumption has remained consistent with more than 70% of the cups consumed continuing to be at home.

“I think one of the trends that we’ve been seeing, particularly with Gen Z and some millennials, is a tendency to actually try to replicate their favorite coffee shop drinks at home,” he said. If you look at some of our liquid offerings and (Café) Bustelo, in particular, and Dunkin’, those liquid offerings really support that trend because mixing pre-brewed, liquid or cold coffee with creamer and sugar at home or even with froth, milk or cream, it’s something that we are seeing consumers do at home because it’s affordable.”

During the third quarter of fiscal year 2025, ended Jan. 31, the company’s US Retail Coffee business unit — its largest — had sales of $741 million, up 2% over the same period of the previous year when sales were $728 million. Segment profit was flat at $209 million compared with $208 million the year before.

“I think it’s important to just remember that despite the fact that we’re at these record high coffee costs, we’ve been pleased with the performance of the coffee business in total and the consumer response to obviously, pricing, but of course, our support of the brand, our merchandising, our marketing as well and just reminding ourselves that at-home coffee is still very healthy in terms of consumption and also being by far the most affordable way to consume coffee compared to all other channels or other formats,” Smucker said on Feb.27, when the company published its quarterly earnings.