Nestle announce a further 10-12% price increase for January 2025 following on from 8% in July.
Prices of Original and Gold Blend all affected...GB In particular will be massively affected with an increase of approx £18.00+ per case.
Coffee prices to soar to new heights, Lavazza warns
Coffee prices are on course to rise further from current record highs as poor harvests, supply chain disruptions and new EU deforestation regulations continue to hammer roasters, Italian group Lavazza warned
The Grocer 01.10.2024
Published on 01•Updated
Europe's coffee lovers are bracing themselves for higher prices as natural disasters hit the world's top two coffee-producing countries.
Droughts in Brazil, the world's largest coffee producer, and severe typhoons in Vietnam, the second-largest, have significantly disrupted global coffee supply chains, driving up production costs that are bubbling their way through to consumers.
As one of the world's largest coffee-drinking regions, Europe's coffee lovers will find price hikes particularly hard to swallow. Europeans consume approximately 3.2 million metric tons of coffee a year, accounting for almost 33% of the world's total coffee consumption, according to German consumer data company Statista.
Perfect storm of challenges drive prices to a 10-year high
The combined effects of Brazil's drought and Vietnam's typhoon have triggered a sharp increase in global coffee prices. The International Coffee Organization (ICO), the intergovernmental body made up of coffee exporting and importing countries, reported that prices surged by nearly 20% in the third quarter of 2024, reaching their highest levels in almost a decade.
Katharina Erfort, from international supply chain management company Inverto is gloomy about the prospect of a return to normal prices any time soon. Speaking to Euronews Business she said: "A quick recovery for the coffee sector is unlikely, even with potential improvements in supply.
"The ongoing effects of climate change make a swift return to stability difficult. The sector remains vulnerable to extreme weather patterns that can continue to disrupt future harvests. Additionally, rising global demand, particularly in emerging markets like Asia, may continue to put upward pressure on prices, further slowing recovery efforts."
Arabica coffee futures, traded on the Intercontinental Exchange (ICE), have risen dramatically, with prices now hovering above $2.50 (€2.25) per pound - up from $1.80 (€1.62) earlier in the year. Robusta prices have followed a similar trajectory, climbing by around 25% to reach more than $2,000 (€1,796) per metric ton.
The sharp price increases have sent shockwaves through the global coffee market. Coffee traders are facing heightened volatility, with concerns growing that continued weather-related disruptions and the cost of rebuilding after the natural disasters could push prices even higher.
Agri-commodities analyst at Rabobank, Carlos Mera told Bloomberg that this crisis is compounded by logistical challenges, such as port congestion and a global shortage of shipping containers, which are hampering the movement of coffee worldwide.