Here’s Why Coffee Prices Are Rising

After a poor growing season, coffee bean prices hit a record high.

March 11, 2025

The retail price of ground coffee hit a record high of $7 per pound in January, up from $4 in January 2020 according to government data, reported the Washington Post.  

Behind these surging prices is a complicated mix of drivers, wrote the Post. “Disastrous growing seasons in the world’s two biggest coffee producers, Brazil and Vietnam, have meant fewer beans on the market. But demand is growing, too: Coffee consumption in China, where a tea culture has reigned for millennia, has surged 150% in ten years, according to the U.S. Department of Agriculture, with its coffee drinkers moving from lower-quality soluble coffee to higher-quality green coffee.” 

Global coffee traders and roasters said they have slashed their purchases to minimal levels as the industry reels from a steep surge in prices, wrote Reuters

“At the U.S. National Coffee Association annual convention in Houston [last] week, attendees said they have been in shock at a 70% increase since November for Arabica coffee futures on the ICE exchange, the benchmark for coffee deals around the world,” reported Reuters. 

A recent Reuters poll, however, predicted that Arabica coffee prices could fall 30% by the end of the year, as high prices curb demand and early signs point to a bumper Brazilian crop next year. 

South Sudan may have found an alternative solution. “Discovered more than a century ago in South Sudan, excelsa coffee is exciting cash-strapped locals and drawing interest from the international community amid a global coffee crisis caused mainly by climate change,” reported the Associated Press

The tree’s “deep roots, thick leathery leaves and big trunk” allow it to thrive in extreme conditions such as drought and heat where other coffee plants cannot, noted the AP.  

“It’s also resistant to many common coffee pests and diseases. Yet it comprises less than 1% of the global market, well behind the Arabica and Robusta species that are the most consumed coffees in the world. For now, it’s mostly only available for purchase online,” reported AP. 

Coffee retailers like Starbucks are showing signs of struggle. Last month, the coffeehouse chain announced it was removing several items from its menu in addition to laying off 1,100 corporate employees to streamline operations.