The price of your green coffee depended not only on quality, but also on oil, geopolitics and a monetary agreement signed in the Saudi desert half a century ago.
Since World War II, coffee has been transacted predominantly in US dollars, a direct consequence of the stability and global acceptance that the currency acquired following the Bretton Woods Agreements. But it was in 1971, when the United States abandoned the gold standard, that the system took a more aggressive and lasting form. Global trade needed a new anchor. Oil provided it. The 1974 petrodollar agreement ensured that every barrel of crude oil was priced in US dollars — and with it, virtually every commodity on the planet, including coffee. The most traded agricultural product in the world was trapped in an orbit that it never chose and from which it has never been able to escape.
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