If you've noticed your morning brew getting pricier lately, you're not imagining things. Coffee prices have surged to their highest levels since 1977.(1)
Why the eye-popping prices?
While supply chain disruptions and weather issues in major coffee-producing countries play a role, new European Union regulations aimed at preventing deforestation are reshaping how coffee is traded globally. Starting December 30, 2024 these changes now affect everything from how coffee is grown to how it's tracked from farm to cup.(1,2)
What does this mean for your daily caffeine fix?
Consider this: 73% of Americans drink coffee daily, with 51% visiting coffee shops at least weekly. If you're among the 48% who get your coffee from your favorite shop, you might want to brace for impact—these price increases will likely hit both store shelves and your favorite café.(3)
Some interesting perspective: while we're paying more for our lattes, only 18% of Americans actually drink their coffee black—down 56% from 2022. The rest of us are splurging on extras like flavored syrups and alternative milk options, with almond and oat milk preferences rising 71% and 90%, respectively, since 2022.(3)
As a reminder, we won’t tell you to “give up one coffee a week” as a budgeting tip. Every dollar you spend should be important to you, from your coffee budget to your education payments. We care about helping you plan for spending that aligns with your values and future plans. Do you have someone helping you plan for financial freedom?
Sources:
1. Coffee Intelligence, "Coffee prices surge to 47-year highs, reshaping the industry," November 29, 2024
2. Voice of America, "How EU deforestation laws are reordering world of coffee," March 30, 2024
3. Drive Research, "2024 Coffee Statistics: Consumption, Preferences, & Spending," February 1, 2024
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Published for the blog on January 31, 2025 by Allos Investment Advisors®, LLC.
