Consumer demand for coffee has, in spite of everything, remained high. As it turns out, the demand for the caffeinated drink is more resilient than many retailers had feared.
A couple of questions remain, however: how significant a price rise have consumers had to absorb? How much have high prices for coffee the commodity affected coffee the drink?
Why has the price of coffee gone up?
Coffee has been hit by several shocks in key growing regions, causing it to reach a 47-year high in price.
In the key arabica-growing region of Brazil, a drought has put pressure on yields, while in Vietnam where much of the world’s Robusta is grown storms have been pushing up prices.
Further challenges have included supply chain constraints, such as congestion, container scarcity, and attacks on shipments in the Red Sea.
Even the EUDR, while not yet implemented, could push up prices as compliance costs will be added for those importing coffee into the EU.
Retail coffee prices: Are consumers paying more?
Consumer demand for coffee has been resilient in spite of the price hikes seen on the commodity end.
Nevertheless, this does not mean that coffee prices have not been on the increase.
According to Circana, volume prices in the EU’s top six grocery markets have risen by 20%. According to Kantar, coffee prices per kilogram in the UK have risen by 5%
Data from Euromonitor suggests that globally, coffee prices saw a year-on-year increase of 8.4% in 2023-24, up from 8.2% the previous year.
While, as seen above, demand has remained resilient for the most part, it has not been entirely immune to turbulence.
Retailers have seen “a drop in volume of traditional and un-differentiated instants and mass blends, and greater pack sales of (ground) blends and roasts, and premium offers,” explains Ananda Roy, senior vice president of global thought leadership and strategic insights at Circana.
