Coffee prices are expected to remain elevated until mid-next year due to severe supply chain pressures, according to the Italian coffee company Lavazza. Chairman Giuseppe Lavazza noted that coffee prices have surged to unprecedented levels, reaching $4,300 per tonne, and are unlikely to decrease soon. Contributing factors include adverse harvest conditions in major coffee-producing countries like Brazil, Vietnam, and Colombia, as well as shipping disruptions from Middle East conflicts. These issues have pushed prices to 15-year highs, leading to a significant increase in the cost of coffee for consumers. In the UK, the price of a 1kg bag of beans has risen by 15% in a year, with potential further hikes of 20-25%. Despite the price increase, the trend of UK consumers making fresh coffee at home remains strong. Lavazza's net profits in 2023 were €68m, down from €95m in 2022, but the company has seen a 2.9% increase in sales volumes compared to the previous year. The UK retail coffee market is valued at £1.3bn, growing annually by 3.9%, driven by price inflation.
Enjoying the read? Subscribe for free to one of the fastest-growing newsletters and get weekly coffee news (TL;DR updates) delivered right to your inbox.