Arabica is grown at altitude and is sensitive to frost and drought in Brazil, which produces roughly a third of world supply. A single Brazilian frost can double the price, and the market has a long history of doing exactly that.
The separate robusta contract covers the lower-grade bean used in instant coffee, and the arabica-robusta spread reflects substitution by roasters when the premium gets extreme. Coffee trees take three to four years to bear, so supply cannot respond quickly and price cycles are long.
Example: coffee at 240 cents is $0.240 x 37,500 = $90,000 per contract. A 10-cent move is $3,750, and daily ranges of 8 to 12 cents are common in a Brazilian weather scare.
Related: cocoa-futures, sugar-futures, ice-exchange, seasonality, cotton-futures