This is why coffee prices are going up in Australia

Why your morning brew is roasting a hole in your wallet

Cofefe — the magical elixir that transforms us from "please don't talk to me" into barely functioning members of society. If I'm being completely honest, having my morning coffee feels like a non-negotiable nowadays and I'm very scared for anyone that gets between me and that morning mug.

Lately you might have noticed that your daily cup is costing more beans than ever... not just cafe coffee, but coffee beans from your local shops too. What gives? Coffee is our last escape in this spiraling turd we call our world. Is this tied to the cozzie lives crisis? Or is this something deeper? What's brewing behind these rising prices in Australia? I've done some research and let me spill the beans.

 

 

The global coffee meltdown

Let’s dive into one of the biggest culprits behind rising coffee prices: the weather. Yes the thing we awkwardly bring up in elevator conversations has a starring role in the coffee crisis. But this isn’t your typical “bit cold hey?” scenario — this is climate chaos wreaking havoc on coffee farms across the globe.

Brazil! The world’s largest coffee producer. In recent years, Brazil has experienced extreme droughts coupled with unexpected frosts — an unusual and devastating combination for coffee crops. In 2021 a brutal frost wiped out 20% of the country’s coffee trees leaving farmers scrambling to recover. A similar story unfolds in Vietnam, another coffee titan, where unpredictable weather patterns have disrupted harvests and reduced yields.

Why does this matter? Less coffee being produced means a tighter global supply, and when demand stays high (because let’s face it, we’re not giving up our brew) prices inevitably rise. Experts predict this isn’t a short-term issue either. Climate models suggest that the regions most suited for coffee farming could shrink by 50% by 2050. Imagine a world where coffee isn’t just expensive but genuinely hard to come by... dear god.

 

 

Supply shenanigans

Even when coffee farmers manage to produce a decent harvest despite climate challenges the journey from farm to cup is anything but smooth.

Let’s start with shipping. The COVID-19 pandemic threw global supply chains into disarray, creating backlogs that are still being felt today. Ports worldwide are overwhelmed, and the cost of shipping a single container has surged. For context, pre-pandemic the cost of shipping a 40-foot container was around $1,500 AUD. In 2023 that figure hit upwards of $10,000 AUD on key routes. These costs trickle down the supply chain, adding cents — and eventually dollars — to your latte.

Then there’s the issue of container shortages. Coffee, typically shipped in specialised containers to maintain quality has been caught up in a global container crisis. With many containers stuck in the wrong ports or used for other high-demand goods, coffee exporters are left waiting.

 

 

Wage wage wage

Here in Australia, even after coffee beans have navigated their perilous journey to our shores, the challenges don’t stop. Once those precious beans make it to your local café, there’s another layer of costs that significantly affects the price of your morning brew: wages and energy.

Cafés are labour-intensive businesses. From skilled baristas crafting your latte art to kitchen staff preparing that perfect avocado toast pairing, people power is essential. With minimum wages and award rates rising steadily in Australia (and rightly so for workers), labour has become one of the biggest expenses for café owners. According to industry reports, wages can account for up to 50% of operating costs for many small businesses. And as we all know, good coffee is as much about the people making it as it is about the beans, so cutting corners on staff isn’t an option for quality-focused cafés.

Then there’s energy. Running a café isn’t just about flipping a light switch and plugging in a toaster. Industrial coffee machines, grinders, refrigerators, and ovens guzzle electricity like it’s a double espresso on a Monday morning. With energy prices surging over the past few years, these costs have hit new highs. Recent figures suggest that energy costs alone now eat up about 20% of a café’s expenses. 

Combine these factors, and you’ve got a recipe for higher coffee prices. Café owners are constantly walking a financial tightrope, trying to balance rising costs while keeping prices reasonable for customers. It’s a tough act, and many are finding it harder to absorb these costs without passing some of the burden onto your cup. 

 

 

We are cooked...

So, what does this mean for us, the plebs addicted to coffee? Well brace yourself for the possibility of paying up to $7 — or even more — for a flat white. Some café owners predict prices could soar to $8 by mid-2025. It's enough to make you consider whether that daily caffeine fix is worth it...

 

... but there is another way

Now before you start contemplating selling a kidney to fund your coffee habit, consider this: there are other ways to get your morning boost. Have you ever thought about trying a coffee alternative? They're often more affordable and can be just as satisfying. Plus some of them come with added health benefits.

Speaking of alternatives, I've recently been sipping on Earthrise's blends. They're a delightful change of pace and kinder to the wallet. But hey, don't just take my word for it — give it a try and see if it perks up your mornings without draining your bank account.

While the rising cost of coffee might be a bitter pill to swallow, it's a perfect opportunity to explore new flavors and routines. Who knows? You might just find a new favorite morning ritual.

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