UNDERSTANDING THE RISE IN THE PRICE OF COFFEE

This little roastery went to the C-market and came home with news that Arabica prices are at an all-time high, surpassing the previous record first set four decades ago.

Such news has understandably set off a slew of bullish articles, each predicting a future of $10–$12 coffees for consumers, not to mention doom and gloom for the cafés making them.

In the face of such uncertainty, however, a healthy injection of knowledge around how our supply chain operates, plus what the industry and customers can do together to mitigate the price rise will go a long way to easing the pinch your wallet feels when enjoying that daily cup of coffee.

Similar to the coffee price rise of 1977 when a ‘black frost’ decimated 1.5 billion trees in South America, any impact on coffee yields in Brazil—the world’s biggest producer of Arabica coffee by millions—is bound to reverberate across the rest of the industry.

While there was no black frost in 2024/2025, climate change-induced shifts in weather patterns saw Brazil and other key supply markets experience unprecedented droughts.These droughts resulted in lower-than-expected yields over the past six months.

As any economics nut will tell you, less supply leads to increased demand, driving up the cost of green Arabica on the C-market to an eye-watering USD 4.03 per pound on 13 February 2025.

Even the market of Robusta (typically considered non-specialty coffee) isn’t safe, with their major producer Vietnam experiencing the same El Niño weather pattern impacting Brazil and a whole host of big-name coffee countries: Ethiopia, Colombia, and Peru to name a few.

Another flow-on effect of these lower yields paired with logistical freight challenges is the rising cost of shipping coffee from origin to Australia. We continue to feel the impact of COVID-19 half a decade on in this particular arena, as the shutdown it caused to shipping capabilities worldwide (creating scarcity in physical containers and a surge in inflation simultaneously) was a bottleneck that the industry has been slow to recover from.

Stitch Coffee’s Nameru Upretee says "That, coupled with the cost-of-living crisis in Australia, is what’s impacting the bottom dollar of your cappuccino."

All those woes aside, however, Australia does hold the privileged position of being a nation of passionate coffee drinkers. We already have at our disposal the means required to weather this price rise—and that’s the go for industry heads and consumers alike.

Stitch Coffee's approach to reducing cost is three-pronged and already underway: a focus on diversified sourcing, a thriving subscription and cafe-retail business model that makes provisions for home brewing, and supporting coffee research that seeks to combat the effects of climate change.

From day dot, Stitch Coffee has championed a rotating list of single origins sourced solely from coffee producers that align with our values of sustainability and stability throughout the coffee supply chain.

Nameru elaborates, "Though the C-market impacts everyone, our method of sourcing from multiple producers and fostering relationships with traceability-minded suppliers has allowed us to fare easier than other roasters."

Moreover, several of our suppliers have such trusted relationships with those at the origin that purchasing prices are often set independently of the C-market.

While this is done in the spirit of ensuring fair wages for producers and their workers, a great side-effect is a steadied green coffee price that’s less impacted by the going-ons of Brazil and other dominating coffee players.

Closer to home, we are alleviating costs for consumers with our holistic embrace of retail coffee products as we predict the rise of home brewing in Australia as a reaction to the cost of living.

As our founder Nawar Adra puts it, “I think we will see a pattern in buying behaviour that strongly resembles COVID-19 times where consumers felt similarly restricted in their ability to buy barista-made coffee, pivoting in lieu to purchasing home-brewing products online.”

“What we’ve learnt from that time is the importance of having retail incorporated into our cafés, which can help offset any potential loss in coffee sales during these tougher times,” he said.

“COVID-19 saw a surge in the popularity of ready-to-brew products like our drip bags, and if our Broadway café was able to get through that time largely unscathed, I’m optimistic that we will come out stronger from this price rise also.”

Speaking of cafés, our Broadway and QVB locations have recently launched a loyalty program to help customers save on their daily coffee and home brewing essentials. Customers who sign up to our Cafe Loyalty Program will receive 10% off every tenth visit to the cafés, including coffee and retail items.

Subscribing to recurring fortnightly or monthly drops of coffee is also a great way to save money without curbing your caffeine addiction.

Similar to other roasters, Stitch Coffee offer free shipping with every subscription order PLUS an extra discount of 15% on every drop, a little saving opens exclusively to subscription members.

You can find out more about our subscription offerings here.

Our last approach is also our most broad-reaching, which is a long-term investment in the betterment of the specialty coffee industry through research.

Specifically, Stitch Coffee works with our sister company ECRE Coffee to donate 2.2c for every kilogram of coffee roasted to World Coffee Research.

This science-led body is leading the way in trialling new resilient coffee varieties and increasing producer access to knowledge and quality coffee seeds to reduce the impact of climate change on the industry while increasing the quality of those whose livelihoods depend on it.

Price rises aside, rest assured that your favourite Sydney coffee roaster isn’t going anywhere. Whether online, in the cafes, or at one of our stockists, we’re here to see you through the day one coffee at a time.