Bay Area Coffee Prices Skyrocket, Highlighting The Damning Cost Of Climate Change On The Coffee Industry – CoffeeTalk

Coffee prices in the Bay Area have been skyrocketing, with Arabica coffee futures setting an all-time high of $4.30 per pound in February. This is more than double the cost of last year, when coffee was under $2 per pound. As of March 6, the price is still at $4.13 per pound. As a result, many Bay Area cafes and roasters have been forced to increase the cost of java. San Francisco’s Andytown Coffee Roasters posted a letter in its cafes explaining why it had bumped up the price of drinks by 7% and coffee beans by 10%.

The “completely unprecedented” spike to more than $4 a pound made them realize that they would be unsustainable if they didn’t raise their prices now. Specialty coffee roasters like Andytown usually pay even more than the commodity price for more premium beans. As of March, a 12-ounce latte at Andytown’s San Francisco cafes will set you back $6.25; an 8-ounce drip coffee is $3. The roaster’s 8-ounce bags of coffee beans now retail for between $13.75 and $15.75. Other Bay Area businesses, including Mr. Espresso, Highwire Coffee Roasters, Red Bay Coffee, Avid Coffee, and Bicycle Coffee, have also marked up prices since the beginning of the year.

Droughts in Brazil and Vietnam, the world’s two largest coffee producers, have led to forecasts of poor harvests, driving up the price of coffee on the commodity market, also known as the C Market. Other factors potentially causing the surge include international shipping disruptions, changing regulations, and President Donald Trump’s threat of tariffs on Colombia, another of the world’s largest coffee producers.

The previous all-time record for the price of coffee was $3.36 per pound, which happened in 1977 after Brazil was hit with a devastating “black frost.” Adjusted for inflation, that 1977 high per pound is more like $17.50 in 2025 dollars, nowhere near where prices are today.

Oakland-based Red Bay Coffee has experienced a 20% increase in costs due to rising coffee prices, labor, shipping, and fuel costs. The company raised coffee beans prices by 10% in February, followed by a small increase of about 5 cents per drink at its cafes in fall. Keeping prices accessible is crucial for Red Bay, as the brand has the tagline “Beautiful coffee to the people.”

Many coffee business owners share a similar fear of hitting a price point at which they start losing people. Mr. Espresso co-owner Luigi Di Ruocco said that the impact to the cost compared to current prices will be relatively small, but he doesn’t precisely know when too much is too much. Mr. Espresso increased coffee bean prices for wholesale customers on March 1 by about 10%, and raised prices at its Oakland cafe the Caffe on Jan. 1 by about 25 cents per drink, though Di Ruocco said the latter increase was unrelated to the rising cost of coffee.

Some coffee purveyors are trying to soften the blow of more expensive brews by introducing other perks. Andytown, for example, coupled its price increase announcement with the news that it would stop charging extra for alternative milks. Highwire Coffee Roasters, which announced it was raising prices for all coffee beans in a letter to customers on Feb. 15, is mitigating frustration by providing delivery to some wholesale customers.

In an ideal world, higher coffee prices would mean that laborers harvesting coffee in Latin America, Asia, and Africa would start making a higher living wage. However, major coffee roasters are still taking home the bulk of profits. J.M. Smucker Company, which owns the coffee brand Folgers, saw its American retail coffee sales increase last year despite raising prices.

Some people hope that the discovery that consumers are willing to pay more for their morning latte could have a positive impact for coffee farmers. Currently, producers only retain about 10% of value generated by coffee, and people will only continue to leave the industry and stop producing coffee if prices are kept at an absurd low.

With the future of coffee prices impossible to predict, local cafes are pleading with Bay Area customers to stick with them, even if they have to raise their prices a little bit.

Read More @ SF Gate