The Briefing
Will coffee prices kill the café scene in 2025?
Dec 8, 2024
Kirk Pearson, the owner of Project Zero Coffee and host of "It's Just Coffee," dives into the brewing crisis of rising coffee prices. He discusses how extreme weather in major coffee-producing countries is inflating costs, creating challenges for cafés in Australia. Kirk highlights how consumers might shift to affordable options, potentially jeopardizing local coffee shops. He emphasizes the importance of quality despite rising production costs and speculates on the future of café culture in an economically strained environment.
25:16
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Quick takeaways
- Global coffee prices are surging due to poor weather in Brazil and Vietnam, posing challenges for local cafes in Australia.
- Consumer resistance to rising coffee prices may lead to a market divide, where low-cost options gain popularity over specialty cafes.
Deep dives
Factors Influencing Coffee Prices by 2025
Global coffee prices are experiencing significant increases, driven primarily by poor weather conditions in major coffee-producing countries such as Brazil and Vietnam. These adverse weather events have led to reduced coffee yields, prompting higher commodity prices as supply struggles to meet demand. Companies like Nestle and the rapidly expanding Luckin Coffee are contributing to the competitive pressure by purchasing large quantities of coffee at fixed prices, further pushing up market rates. This combination of climate impact and corporate demand suggests that consumers may face noticeable price increases for their morning coffee in the coming years.
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