Get all your news in one place.
100’s of premium titles.
One app.
Start reading
ABC News
ABC News
Business

Think you're paying too much for your morning coffee? The worst is yet to come

Coffee price increases are well overdue according to industry leaders. (ABC News: Alkira Reinfrank )

It is a daily ritual for millions of Australians, but if you have noticed the price of your morning flat white or soy latte increase, brace yourself — it is likely to get worse.

By the end of the year, coffee lovers will be paying up to $7 for a regular cup as cafes nationwide struggle to absorb growing overhead costs warned David Parnham, president of the Café Owners and Baristas Association of Australia.

"What's happening globally is there are shortages obviously from catastrophes that are happening in places like Brazil with frosts, and certain growing conditions in some of the coffee growing areas," Mr Parnham said.

"It's nearly five times the container prices of two years ago due to global shortages of containers and ships to be able to take things around the world."

Frosts in Brazil have impacted supply. (Supplied: Melbourne Coffee Merchants)

The pain will be felt from the cities to the outback, but Mr Parnham said the increase was well overdue, with the average $4 price for a standard latte, cappuccino and flat white remaining stable for years.

"The reality is it should be $6-7. It's just that cafés are holding back on passing that pricing on per cup to the consumer," he said.

Bounce Café in Townsville was initially hesitant to hike its coffee price by 50 cents.

Bounce Café said its customers have been very happy to support their business despite the increase in price. (Supplied)

But roaster Raoul Hauri said it hadn't made a dent in sales, with more than 300 customers still coming through the doors for their daily fix.

"No one really batted an eyelid," he said.

"We thought we would get more pushback, but I think at the moment people understand.

Paving the way for Australian producers

While coffee drinkers will be feeling the pinch, Australian producers like Candy MacLaughlin from Skybury Roasters hopes the increasing cost of imports will pave the way for growth in the local industry, allowing it to compete in the market.

"[In the ] overall cost of business, we haven't been able to drop our prices to be competitive, so we've really worked on that niche base," Ms MacLaughlin said.

"Now we can take all of those plus play in the same space as the internationals because our price point, although won't be similar, it will be in the same ballpark."

Candy and her husband Marion produce 40 tonnes of coffee annually but they are prepared to scale up operations (Supplied)

Skybury Roasters is based on the Atherton Tablelands near Cairns and produces 40 tonnes of coffee beans annually, but Ms MacLaughlin said they were ready to scale up to meet demand.

"All those things will help us to grow our coffee plantation once more."

She said the industry could eventually emulate the gin industry, with boutique operations cropping up across the country.

"What you will get is all these kinds of niche coffee plantations who develop a very unique flavour profile and then market in funky packaging and appeal to certain markets," she said.

"That's where I see the next stage of the Australian coffee industry going."

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.