Since the beginning of this year, coffee prices in the United States have been steadily rising. Data released by the US government recently shows that in September, the average price of ground coffee in the US was $9.14 per pound, up 3% from $8.87 in August and a significant 41% higher than in September 2024.
According to a report from the US Department of Labor on Friday, in September, food prices for both at-home and away-from-home consumption increased by 3% compared to the same period last year. The Consumer Price Index (CPI), which includes all coffee products including instant coffee, showed that coffee prices in the US rose by 19% compared to September 2024, remaining steady from August.
Nikki Bravo, co-owner of Momentum Coffee in Chicago, raised the prices of lattes, cappuccinos, and other beverages by around 15% in all four of her stores across the country last week. She mentioned that the cost of purchasing coffee beans has increased by 15% compared to a year ago, prompting them to start roasting more beans in-house to cut costs, with their coffee beans primarily sourced from Africa.
She also noted that other consumables like cups and sleeves have seen price hikes as well. Furthermore, Chicago raised its minimum wage to $16.60 on July 1.
Bravo added that stubborn inflation has also led consumers to cut back on spending, with some reluctant to purchase takeaway coffee.
Data from the restaurant management system Toast shows that the average price of regular coffee in US restaurants in September was $3.54, up from $3.45 in the same period last year.
Tariffs may be a significant factor in the drastic fluctuations in coffee prices. Except for Hawaii and Puerto Rico, there are few regions in the US suitable for growing coffee. According to the National Coffee Association, 99% of coffee consumed in the US is imported.
Brazil is the largest supplier of coffee to the US, accounting for 30% of the market share. The Trump administration imposed a 40% tariff on Brazilian products in July, on top of a previous 10% tariff.
Investment bank UBS pointed out that Brazilian producers have started halting shipments to the US and are negotiating with American roasters on how to share the additional costs, leading to a decrease in US supply.
Colombia, which supplies 20% of the US coffee market, currently faces a 10% tariff. President Trump recently warned of further tariff hikes and an end to aid to Colombia.
Vietnam, supplying 8% of the US coffee market, has faced a 20% tariff since the summer.
In September, Congressman Ro Khanna (Democratic Party of California) and Congressman Don Bacon (Republican Party of Nebraska) jointly proposed a bill to completely repeal coffee tariffs.
Coffee prices are also being affected by global climate change. In recent years, extreme weather conditions such as high temperatures and droughts have damaged coffee production worldwide, causing prices to soar. According to data from the Food and Agriculture Organization of the United Nations (FAO), global coffee prices rose by nearly 40% in 2024.
Earlier this month, the National Oceanic and Atmospheric Administration (NOAA) announced the formation of the La Nina phenomenon, sparking concerns in the market about possible droughts in Brazil, leading to another surge in coffee prices.
(Adapted from an Associated Press report)