The price rise on the coffee beans is changing how many cups people have a day. In the United States, coffee beans went up almost 21% in August compared to last year, this is the biggest since 1997. Part of this rise comes from the new exportation tariff: 50% for Brazilian coffee and 10% for other countries in Central America and South America. In the middle of this pressure, local coffee shops are trying to survive the hit and give some relief to consumers, who are also tired of the inflation, with little adjustment and honest explanations.
The coffee industry might be a “roller coaster,” but not getting the makers and buyers dizzy on the ride is what’s most important.
What’s behind the bean rise?
The simple way of explaining it would be: grain prices rise + new tariffs = higher prices.
Ben Hodge, coffee director at Mayfly Coffee (propriety of Cadance Coffee), puts it like this: “That’s also not including the 50% tariff for Brazilian coffee. 10% tariffs for countries in Central America, South America. So, some of them haven’t been hit as hard. We have been able to eat the cost a bit on our roasted coffee because the price fluctuations are like a rollercoaster. It goes up and down throughout the year.”
But the truth is, this is not new, but it is the highest percentage since 1997. To local coffee shops, this is highly uncomfortable. They have to assume the increase. Some adjust their prices slightly so the customer doesn’t feel it so strongly that they stop coming.
“When I first started in coffee about 5 1/2 years ago, the green coffee price was less than a dollar per pound. So, like $0.93 and now it’s shot up recently till about $4.33 per pound.” With that comment, Hodge shows that this doesn’t seem like a temporary situation much, but rather something that’s been building up for a while, and calls to take prudent actions and communicate a lot.
How coffee shops are responding
With persistent inflation, many businesses are taking short but firm steps. Michael Rice, Mad Priest Coffee Roaster owner, made a strong decision, to raise “just one dollar” the coffee bag price. And although he’s not happy with the decision, the situation calls for it, “We really believe in keeping our coffee accessible to as many people as possible. So, if that means I take a margin cut even with a price increase, then I’m willing to do that. As long as it makes sense sustainably. Recently, we had to make that decision to raise prices, but only by 7%”.
Other coffee shops are adopting the honest solution too, absorbing what they can, adjusting the minimum, and explaining why.
But it’s not all negative, there’s also a positive side reflected in the market. As Rice points to it, the rising could also translate to paying better the agriculture that produces it. And in the counter, the public seems to react well to it. That backing up is crucial, it supports the teams, keeps the quality, and avoids losing the warming coziness of the daily experience.
Keep supporting the locals
Now that coffee prices are rising faster than it takes you to drink it, we might have to go back to the essentials: honesty, patience, and community.
Yes, it’s a difficult time for coffee makers, and coffee lovers, but there’s also hopeful news, like Mad Priest Coffee opening another location in the week of 22 September.
It’s a situation that ask to act carefully and honestly so that cup of coffee keeps tasting good. To support your local shops so everyday coffee can continue to be the reasonable and constant pleasure it is for most of us.