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High cost of coffee: the perfect storm

24/11/2024

The ‘Expensive Coffee’ or "High cost of coffee" phenomenon is now widespread throughout Europe, where coffee prices are rising steadily. Why? This growth is linked to a number of factors that are affecting both Arabica and Robusta coffee wholesale prices.

high cost of coffee cup

Rising prices: a trend that shows no sign of stopping.

High cost of coffee is linked to a number of causes that are affecting both Arabica and Robusta coffee wholesale prices. Rising production costs in the countries of origin, coupled with increasing demand, have contributed to making coffee an increasingly expensive resource for roasters and distributors. In 2024, the price of Arabica reached unprecedented peaks and Robusta also saw significant increases, making the expensive coffee a topical issue.

Global factors behind the rising cost of coffee.

Many major coffee producing countries, such as Brazil and Vietnam, are facing difficulties due to extreme weather events, from droughts to floods. Droughts alternating with torrential rains mean that the supply of green coffee is always lower than demand as crop yields fall and wholesale prices soar. Added to this are the transport and logistics costs, which have seen significant increases in recent years. Among the causes of these price hikes is the difficulty in using the shortest maritime route between Asia and Europe— the Suez Canal —due to Houthi attacks. In an increasingly interconnected market, dynamics like these quickly affect European economies, influencing the consumer price of each cup of coffee.

The effects on consumers and businesses in the coffee sector.

Rising coffee costs have a direct impact on end consumers, but also on restaurants, cafés and other operators in the Ho.Re.Ca. sector. Increasingly, companies are having to revise their price lists or redefine their purchasing strategies to cope with rising costs. In some European countries, the average price of a cup of coffee has exceeded the psychological threshold of 2 euros, affecting consumption habits and the frequency with which consumers choose to enjoy a coffee outside the home. For the catering business, being able to maintain a competitive price while guaranteeing high quality is becoming an increasingly complex challenge that requires a reliable supply partner.

Towards a more sustainable and traceable coffee market.

For procurement companies such as Qahwa, the ‘expensive cupalso represents an opportunity to rethink supply practices. The growing consumer focus on sustainable, quality coffee is driving companies to choose certified suppliers and traceable supply chains.

This is why Qahwa already holds the Bio, Fairtrade and Rainforest certifications and has been committed for years to guaranteeing the sustainability of its products and the transparency of its processes: direct relations with producers and regular visits to plantations allow us to identify crops that concretely apply processes that respect the environment and people.

The realities of the sector can and must face the challenge of the high cost of coffee by focusing on greater transparency in product traceability and more resilient supply strategies. In this scenario, Qahwa is committed to guaranteeing the quality and sustainability of its supplies, maintaining high standards that meet the demands of the European market.

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