Global coffee traders and roasters said they have drastically reduced their purchases as soaring prices strain the industry, while suppliers struggle to convince retailers to accept higher costs.

At the United States National Coffee Association convention in Houston this week, attendees expressed shock over a 70% surge in Arabica coffee futures on the ICE exchange since November.

The Director General at ELCAFE C.A. in Ecuador, Renan Chueiri, noted that for the first time, the company hasn’t sold its entire expected annual production by March.

“We would usually be sold out by now, but so far we sold less than 30% of production,” he said. “The big price increase eats clients’ cash flow, they don’t have all the money to buy what they need.”

Rising coffee prices are driven by lower production in key growing regions, especially Brazil, the world’s top producer, leading to reduced bean availability.

“Nobody wants to be exposed, nobody is buying for future delivery, it is all hand to mouth,” said a coffee broker, who requested anonymity due to the issue’s sensitivity.

He noted that many recent deals in Brazil have been handled with extreme caution.

“You close a deal, and then you have seven days to go to the farm or warehouse and get your coffee. You check the quality, and if it is ok, you make the payment on the site and drive away with the coffee.”

A Reuters poll forecasts a 30% drop in Arabica coffee prices by year-end, driven by weaker demand and expectations of a strong Brazilian crop next year.

Until then, the industry faces tough times.

The CEO of a major U.S. roaster, in the world’s largest coffee market, said some clients are unsure if they can stay in business.

“They don’t know if they will be able to sell their product at the new prices,” he said, also asking not to be identified. “Some people are going down”.

The CEO noted that supermarkets and grocery stores were resisting higher prices from roasters, leading to prolonged negotiations and some retail outlets beginning to experience coffee shortages.

“It has been a nightmare,” he added.

A storage industry executive said U.S. coffee warehouses near ports, which handle beans from Central and South America, are holding only half their usual volumes.

“Some storing companies are returning silos to the owners, canceling leasing contracts early,” he said.