Coffee pricing & what you need to know

Coffee is in the news for a lot of reasons lately, some good with regards to ever new health discovery benefits, and others less good, especially with regards to price. Coffee prices are rising. Why and what does it mean for your daily cup?

This news began last summer amid a bad crop in two of the worlds largest coffee growing areas, Brazil and Vietnam. Last year both of these major producers had a bad crop year, resulting in lower yields. It is not uncommon for one of the major producing countries to have a bad crop, but typically when it occurs, other countries are able to make up for the balance, but when both of these major producers had a bad year, commodity speculation bet on increased prices and pricing began to rise rapidly, even before the shortages had any actual affect on the market. Approximately 90% of trading around coffee that happens in the commodity market takes place from computer automation, meaning that much of it is based on basic statistics rather than actual on the ground scenarios. 

The result an unprecedented 70% spike in commodity coffee prices. 

While tariffs loom large over the coffee arena with regards to importation in the US, it is generally considered that these increases will be negligible compared to what we saw happen last fall with coffee pricing. Currently coffee on the commodity market has nearly doubled in the last year. As coffee prices in both commodity coffee and the specialty market have so rapidly increased, there has been a resultant increase in coffee at every step of the chain from export to import. Even large coffee producers who typically have kept consistent pricing over decades of small price fluctuation have been forced to increase prices in the last six months. It is likely you have seen your pricing increase, no matter what brand you drink.

We expect prices to stabilize this year as crops in most major growing regions in Brazil, Vietnam, India, and Colombia have all been relatively good. But other global impacts have stuck resulting in the likelihood that prices will not decrease anytime soon. Global inflation, as well as fuel and transport costs have remained high. On the flip side, because of the high spike in commodity coffee, there has been a reduction in demand which should help prices soften at least a little. But overall, with the costs that have gone up across the chain of coffee, including inflation and what seems to be a likelihood of tariffs, costs have gone up across the board and hit all coffee companies, from large to small.

While we have had to increase our prices as well, we’ve done our best to increase as little as possible and have even absorbed some of the costs, while working to be more efficient with our production. One of the best ways we have to save customers that buy directly from us online is by offering a savings with larger bag purchase which increases efficiency in packaging and in shipping. 

To that end we offer a 5% savings on 2 pound bags, and 10% savings on 5 pound bags. We also offer free shipping on all orders $45+ which includes all 5 pound bags.