Brazil's coffee plantations have been hit hard by a three-year drought, and this year's rainy season came too late to help the coffee-growing Espirito Santo region.  It means that world coffee prices are likely to stay at the current multi-year highs.

"The situation has been dramatically bad, just terrible," said farmer Carlos Babilon to the Wall Street Journal.  "In general the harvest is going to be worse in 2017 than 2016," and harvests will only be able to start to increase again in 2018, if recent favorable weather continues.  And demand is expected to outstrip supply for at least another two years.

Brazil produces about 20 percent of the world's Robusta Beans, a high-caffeine bean used in instant coffee and espresso.  Most of Brazil's coffee plantations are in Espirito Santo.  Robusta production there was down 24 percent during the 2015-2016 growing seasons.  Because Arabica beans can be used as a substitute when Robusta supplies are down, those prices are up as well.

But the higher prices haven't been enough to compensate for low production.  Farmers like Mr. Babilon are slashing expenses on important things such as their own health care.  Many have turned to other crops such as Bananas, Mangoes, and Peppers - but it's still not enough to fill in for the real money-maker.  "It's the coffee that pays the bills," said farmer Julio Cezar Cuquetto.