Why Coffee Prices Are Likely Going To Increase In 2025

Eggs and chocolate aren't the only foods set for a price hike as the year goes on. Morning people might not be as sunny as usual when they come to find coffee prices are also on the rise. Coffee in all its formats, whether pod, drip, or beans, have experienced record-breaking price spikes and experts in the industry anticipate the situation will only get worse. 

These record breaking price increases are largely due to weather events that have led to major bean shortages. Industry analysts have noted Arabica coffee bean prices closed at an all-time high of $4.04 per pound recently, a 26% increase from the fourth quarter of last year. Similar increases have been recorded for pods and drip coffee in the last couple years. Coffee pods were up to 55 cents each in 2024 and drip coffee now costs 14 cents a cup 2024, up from 13 cents in 2023. 

A few cents might not seem like a lot at first glance, but over time and taking into account the larger supply issues, this could make a morning Starbucks run an even bigger luxury than it already is. Climate change effects have been ravaging coffee bean harvests for years now. Meanwhile, the demand for coffee has only increased, making the price situation only that much worse.

Although coffee is a globally enjoyed beverage, the majority of the bean supply comes from two specific countries, Brazil and Colombia. Other top coffee supplying countries include Vietnam and Malaysia.

Coffee beans are the kind of crop that needs specific conditions in order to grow well. Unfortunately, severe droughts in both Brazil and Vietnam led to bad harvests last year. In Indonesia, heavy rain led to a lower yield as well, but the region's coffee supply is expected to rebound. The overall world production of coffee is expected to be higher for 2025 than it was the previous year because of this rebound, but the unpredictability of weather conditions makes those forecasts difficult to trust.

You may see just a few cents extra coming out of your wallet each morning, but a few more rain storms and dry seasons could easily turn those cents to dollars. As erratic as harvests can be, the one constant that seems to remain is people's love for a good cup of coffee.