Coffee prices: why are UK prices so high, why do they keep rising - how much a brew could cost you

• UK coffee prices are expected to remain high until at least mid-next year
• Lavazza's chairman, Giuseppe Lavazza, admitted his previous prediction of a price drop was incorrect
• Factors for rising prices include poor harvests in Brazil and Vietnam and supply chain disruptions
• Coffee prices reached an all-time high of $4,300 (£3,356) per tonne on 8 July
• They could increase by as much as 20-25% over the next year
• Despite high prices, UK consumers continue to shift towards brewing coffee at home

UK consumers won't see a drop in soaring coffee prices until at least mid-next year, according to Lavazza, due to “very challenging headwinds” facing the industry.

Giuseppe Lavazza, the group's chairman, acknowledged he was mistaken in his prediction last year that prices would decline this year.

He attributed the surge in prices to poor harvests in key production areas like Brazil and Vietnam, geopolitical conflicts and ongoing supply chain disruptions.

On Monday (8 July), prices hit an all-time high of $4,300 (£3,356) per tonne, with Lavazza saying, “We have never seen such a spike in price as the trend right now.”

Blockages in the Suez Canal have seen shipping costs alone hit four times the average. For UK consumers, this has meant the price of a 1kg bag of beans rising by 15% in a year, and Lavazza said it could increase by 20% to 25% over the coming year.

Meanwhile, a flat white at the firm’s flagship cafe off Regent Street in central London now costs £3.50 to take away or £5.50 to have in, reflecting current costs.

Lavazza said: “We have faced very, very strong headwinds. I don’t see any reason why coffee prices will go down.”

But this has not dented the “strong trend” of UK consumers turning to beans to make fresh coffee at home, which began when the pandemic closed cafes but has showed no sign of slowing even now.

Lavazza said: “People love it so much. And we think there’s an environmental element too, of people wanting to move away from using pods.”

The UK retail coffee market is worth £1.3 billion, growing by 3.9% year on year, according to Nielsen figures, driven by price inflation of 3.8%.

Lavazza said sales volumes were up 2.9% in 2023 compared with the year before, or the equivalent of 32 million more cups of Lavazza coffee on two years ago.

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