With The Cost Of Coffee Potentially Reaching $20 For A 12oz Bag, Will Consumers Start Stockpiling? – CoffeeTalk

Coffee prices have been rising due to tariff threats and weather conditions in coffee-producing countries. Lisa Wells, a public-relations consultant from New York City, has taken to buying multiple bags of her favorite beans and storing them in her pantry to lock in prices. This strategy has paid off financially, as costs have been rising steadily in the past couple of years.

The recent announcement by President Donald Trump that he plans to impose a 50% tariff on Brazilian goods led to an immediate spike in coffee futures, up 5.4% on Monday to $3.0185 per pound. However, prices have generally been climbing over the past few years. In January 2023, coffee futures were as low as around $1.50 per pound, but by February of this year futures had soared to above $4, though they then fell in May and June.

Retail coffee prices have also been trending higher, with retail prices being up 2.2% over the previous month, according to federal data released Tuesday. Those who buy higher-end coffee are especially feeling the pain, as 12-ounce bags of coffee are selling for at or above $15, even above $20 in the case of some select offerings. If you’re buying a morning cup from your local specialty place, you’re now paying $4.50 on average for that premium brew, according to data from Toast, a company that provides payment services and tracks the restaurant industry. That’s up from $4 two years ago. Even a median-priced cup of coffee, as in your everyday restaurant joe, now costs $3.50 — up from $3.13 two years ago, according to Toast.

Bad weather conditions in coffee-producing nations, such as a drought in Vietnam, have generally been driving prices higher. Just as the situation was seemingly looking better, at least on the futures front, the tariffs add a new twist. Jack Scoville, vice president of the Price Futures Group, said that “we’re going to pay through the nose” of the tariffs’ impact on retail coffee prices.

Consumers can consider other options to save money, such as trading down from high-end brews to more affordable ones or brewing at home instead. Some coffee companies have been holding the line on pricing, with Starbucks being the most prominent example.

Raphael Perrier, co-founder of Florida-based Kahwa Coffee Roasters, said that companies that keep boosting prices may learn the hard way as they lose customers in the process, and in the end, that will force the most expensive ones to lower prices.

Either way, there could be relief in sight, especially as weather conditions improve in major coffee-producing countries. There’s also the possibility that the Trump administration could lower its 50% tariff rate on goods imported from Brazil.

Read More @ MarketWatch