The coffee industry has faced significant cost increases over the past few years, creating challenges for everyone in the supply chain—from farmers to roasters to coffee shops. Between late 2021 and 2022, coffee prices surged 150%, while shipping costs skyrocketed 350% (jumping from $3,000 AUD to nearly $14,000 AUD per container).

During this period, almost every coffee roaster had to adjust their pricing, typically increasing costs by $2 to $4 per kg. However, many continued to absorb a portion of these increases, despite rising expenses in wages, rent, materials, and equipment. Coffee shops also had to make small price adjustments, raising coffee prices by $0.20 to $0.50 per cup while adjusting their menus elsewhere to stay afloat.

While coffee prices eased slightly through 2023 and much of 2024, they never returned to sustainable levels. And now, they’re on the rise again.

Why Are Coffee Prices Increasing Again?

By the end of 2023, many expected coffee prices to continue falling. However, early warning signs pointed to serious struggles in Brazil and Vietnam, the world's two largest coffee producers. Many in the industry underestimated the severity of the situation, leading to a sudden and dramatic surge in prices.

By December 2024, it became clear that the worst was yet to come—harvest forecasts dropped significantly, and record-low stock levels exposed the true scale of the crisis.

Key Factors Driving the Current Price Surge

Climate Events For four consecutive years, droughts and extreme weather have impacted coffee production in Brazil and Vietnam, reducing yields and creating supply shortages.

Supply & Demand Imbalance Global coffee consumption continues to rise, but production is struggling to keep up, leading to historically low stock levels. We are consuming more coffee than the world is producing.

High Shipping Costs & Container Shortages While shipping prices are lower than their 2022 peak, they remain elevated, and container availability is still limited, disrupting global supply chains.

Wall Street Speculation Investors in the coffee futures market are driving prices higher based on bleak production forecasts, further amplifying volatility.

Currency Fluctuations in Producing Countries Stronger local currencies in key coffee-producing nations have incentivized growers to hold back supply, waiting for better exchange rates before selling their crops.

New Tariffs on Colombian Coffee Tariffs set to be imposed on Colombia, the world's third-largest coffee producer, have added further pressure to global coffee prices.

Coffee prices are climbing at an unprecedented rate, and the concern is no longer just how high they will go, but who will be able to secure enough supply to maintain consistency and meet customer demand.

We understand that rising coffee prices bring challenges, but as your go-to coffee roaster, we are committed to delivering the highest quality coffee while navigating these changes together. Thank you for your continued support and loyalty!