Here’s why your morning coffee costs more and why the price might keep rising

If your morning cup of coffee has left a bitter taste in your mouth lately, it might not be the beans, but the price that’s making you bitter.

The price of a flat white – and any coffee made in a cafe – has been pushed up not only by the cost of international freight and wages, but also by ancillary items such as the wholesale price of caramel syrup .

What is the average price of a coffee today?

Daniel Mejia of Colombia Coffee Co owns several cafes and is a coffee bean wholesaler on Queensland’s Sunshine Coast.

He said people should expect to pay between $4.50 and $5.50 for an average 250ml (8oz) coffee without fancy milk or extra shots of espresso.

“When you pay $5.50 for an eight-ounce coffee, the expectation you should have as a customer is that it’s going to be first-class coffee,” he said.

“You almost want to walk out of that store, relishing in the coffee you just drank.

“A coffee that used to be $5 is now probably $6.”

Mr. Mejia says he is sensitive to price increases because he sees coffee as a way for people to connect.(ABC Sunshine Coast: Owen Jacques)

He said every element of coffee making is now more expensive: beans, electricity used to heat water, machine maintenance, milk and any milk alternative.

“But if you get a flat white with an extra hit of soy, with a hit of caramel, then the soy has gone up as well.

“The caramel shot that was 50 cents, is probably 70 or 80 cents.”

Perfect storm in your cup of coffee

Bruno Maiolo has run the Australian Specialty Coffee Association for 20 years and runs C4 Coffee in Melbourne.

Man with short dark hair looking inside a bag of coffee beans
Mr Maiolo says global factors affect coffee prices in Australia.(Provided: Australian Specialty Coffee Association)

He said $5 was the right price to pay for an average, average coffee that would have cost $3.80 a year ago.

But even though it was more expensive, the cafes still didn’t pass on the full cost.

“Just in terms of supply and trade issues, a cup of coffee should really be closer to $7 if everyone were to maintain the same margin they enjoyed before COVID.”

“[The price] will still climb. You have to because you have to pass on the costs. »

Mr Maiolo said many factors both globally and in Australia come together to drive up the price of a barista-made cappuccino.

He said the biggest contributor was COVID, which not only forced farms in many countries to close, but also caused a large number of deaths, which impacted their workforce.

Barista hand pouring a latte with pattern.
The cost of a cup of coffee could continue to rise as cafes and wholesalers are forced to pass on the costs.(ABC News: Alkira Reinfrank )

When beans were sent around the world in a shipping container, that too cost more.

Mr Maiolo said the cost of transporting a container had increased sixfold, from $2,500 to around $15,000.

In addition to these factors, Brazil – a major coffee-growing region – suffered a massive frost last year, which resulted in fewer beans being picked.

close up of coffee beans in the roaster
Mr Maiolo says COVID, a shortage of workers on foreign farms and the cost of freight are all driving up the cost of beans.(ABC Central West: Xanthe Gregory)

With increased demand and less grain, the price went up again.

Mr Maiolo said none of these factors were likely to resolve any time soon.

“The price will stay high for some time, at least the next 12 to 18 months, before we can start to get back to some sort of normalcy in terms of freight and logistics,” he said.

Making coffee “more than a business”

Back on the Sunshine Coast and Mr Mejia said while he felt he had no choice but to raise the price of his coffee, it was a painful decision to make.

He said the survival of his business wasn’t the only thing on his mind.

“Coffee is the social lubricant that keeps people moving and connecting with each other.

“We’re the stewards of that, and we’re taking that role beyond our business and more of a community role.”

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