What’s really going on with coffee prices?

Tuesday, 11 February 2025

Soaring coffee prices are the talk of the town.

There’s more than caffeine setting coffee lovers’ hearts aflutter, with soaring bean prices and predictions of $10 flat whites the talk of the town last week.

But how dire is the situation, really? Here’s what the numbers tell us.

2023

Prices have been climbing pretty rapidly for a while now. in October 2023, Stuff reported that the cost of a takeaway coffee was rising at the fastest rate in a decade, increasing by 30 cents a cup in just one year.

Figures from Stats NZ showed the average price of a takeaway coffee rose from $4.33 in June 2022 to $4.63 in the same month the following year, a 6.9% increase.

$3.65

According to Stats NZ, the average price of a takeaway coffee in February 2015 was $3.65. Adjusted for inflation (using the Reserve Bank’s handy calculator), that same cup should cost $4.83 today.

$4.84

The most recent stats show a takeaway coffee cost an average of $4.84 in December 2024. That’s tracking about as close to inflation as you can get, so what’s all the fuss about?

The cost of coffee beans is soaring, and it’s likely to take retail prices with it.

Because they can be skewed by outliers ‒ in this case either really high or really low prices ‒ averages don’t always paint an accurate picture. That means a whole lot (obviously not a statistical term) of New Zealand’s takeaway coffees are likely being sold for significantly more than $4.84.

$4.50 to $7.50

On that note, let’s have a look at what we’re actually paying. A Stuff staff member was charged $7.15 for a small oat flat white in Auckland on Thursday, although that did include a public holiday surcharge. Another café in central Auckland was charging $7.50 for the same thing, without the surcharge.

And in central Wellington on Friday, a quick survey of six cafés found the price of what was described as a regular or medium flat white varied between $5.20 and $6.20, although another Stuff staff member reported one café in town charging just $4.50.

$15.60

Even at more than $7 a cup, coffee boffins say we’re getting off lightly, given the increasing cost of coffee beans recently.

Arabica coffee futures prices breached the US$4 a pound mark (about NZ$15.60 per kilogram) for the first time in New York last week after climbing steadily for the past couple of years, and surging in recent months.

Arabica prices have been driven higher by an anticipated sharp output decline in Brazil, the world's top producer, following an extended dry spell in 2024 that impacted the latest harvest.

So, how bad do they think things could get?

$10

Flight Coffee managing director Richard Corney is warning coffee fans to expect the price of a cup to push $10. Although he doesn’t think that will happen this year, he says price rises are “unavoidable and completely necessary.”

Wellington coffee company Mojo isn’t ready to through double-digit predictions around just yet. However, after absorbing the increased costs over the last six months or so, it is expecting its prices to increase by 10 cents to 30 cents per cup over the next month.