Why the price of a cup of coffee is skyrocketing

Pret also raised the price of an americano, from 21 pc or 41 pence to £2.40. At Caffè Nero, an average latte now costs 10pc more, or 25p, at £2.85. At Costa, a cappuccino jumped 9pc or 25p more to £3.10.

Paul Rooke, executive director of the British Coffee Association, says these increases cannot be attributed to any single factor, but rather to a “myriad of cost pressures all occurring at once”.

After struggling to survive the pandemic, he says many businesses have little wiggle room and so few options but to pass the burden on to customers.

Smaller companies have been hit harder because they lack the ability to strike long-term deals like larger ones can.

“You have a situation where a lot of companies are already shattered in terms of financial flexibility,” Rooke says. “There just isn’t the capacity to absorb these kinds of cost increases right now.”

This applies to the whole range – from coffee beans, milk and cups to shipping costs, wages and energy.

Since the start of the pandemic, the price of coffee itself has more than doubled due to a combination of shortages caused by poor harvests, as well as shipping costs. In January 2019, a pound of beans cost around $1, down from around $2.50 on Thursday.

This is partly due to freak frosts ravaging crops in Brazil, by far the largest exporter of coffee beans in the world.

Meanwhile, bottlenecks in shipping have increased the cost of transporting goods globally sixfold over the same period, according to consultancy McKinsey.

Even disposable paper cups and their plastic lids have not been spared. Companies including Starbucks have had to temporarily discontinue branded cups in some stores due to delays in the usual supply – a problem compounded by worker shortages at paper mills and resin production issues caused by weather conditions. .

Like the vast majority of businesses, cafes are also struggling to hire enough workers, leading to higher wages.

In Oxford, Barr says local applicants demanded up to £15 an hour and benefits such as bonuses or travel allowances. The statutory national living wage is £8.91.

Now she may have to hire her husband and nephew into her business, just to make sure her store is properly staffed.

Faced with so much cost pressure, it wearily accepts that price increases are now “inevitable”.

“I already have customers complaining about the prices when we haven’t raised them yet,” she adds. “It’s concerning because Valentine’s Day this year was already not so good because of the weather.

“But we will do whatever it takes to survive. We are passionate about coffee and we love running this business – it’s part of our lives. »

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