Coffee, tea & chocolate prices keep rising — no relief in sight

Record-high global prices for coffee, cocoa, and tea are significantly impacting Ukrainians' wallets. The main reason for this is reduced supply due to poor harvests in Brazil and Vietnam. These two countries account for a large share of global production. 

Over the past year, the global coffee market has been turbulent — the price of Arabica coffee has nearly doubled, rising from $2.20 to $3.34 per pound, writes Komersant.info.

"The 2024 harvest in Vietnam and Brazil did not meet the optimistic forecasts due to prolonged weather problems in late summer," the economist Duknytsky says.

Another factor was farmers' declining sales, as they expect even higher prices in the future. Thus, not only is the growth continuing, but it is also establishing a new reality: coffee will not be cheaper.

Global chain: tea and cocoa are not far behind

A similar situation is observed in other agricultural markets. In the tea market, for example, prices began to rise in the summer of 2024 due to climate anomalies in India, which is one of the world's largest producers. Heat and flooding caused a 30% decrease in the harvest, automatically pushing prices up by 20%.

"The rise in tea prices began in the summer of 2024, mainly due to excessive heat and flooding in India," comments Dukhnytsky.

The situation is even worse in the cocoa market. During the 2023/24 season, global cocoa bean production decreased from 5 million to 4.4 million tons. In December 2024, the price peaked at nearly 12 thousand dollars per ton. Currently, prices range from $8,300 to $8,700 per ton.

"The next surge in the price of cocoa beans occurred in December 2024, when their price reached a maximum of 11,985 USD/t," the economist clarifies.

And, importantly, even if raw material prices stabilize, chocolate will remain expensive. Why? Because production will not recover quickly.

"Market experts do not see any opportunities for a full recovery of production, so even with further stabilization of cocoa bean prices, the cost of finished chocolate will rise," he predicts.

When will the world feel the next price increase?

For countries without their own coffee and tea production, all of these products — coffee, tea, and cocoa — are imported. This means they are completely dependent on global price fluctuations.

At the same time, there is another nuance: consumers do not immediately feel the price increase, rather, they feel it with a lag of 3–4 months due to the peculiarities of logistics, contracts, and market stocks.

What should businesses and consumers do?

Beverage companies should prepare to revise their procurement policies. They should consider establishing long-term contracts or building up stocks. Consumers should adjust their habits without waiting for prices to return to normal.

Dukhnytsky concludes, "Given the current forecasts of a poor harvest and reduced stocks, we should expect a gradual increase in prices in the future, especially in the coffee and chocolate segment".

Earlier, we shared expert tips on how to choose quality coffee, and a recipe for a real homemade treat with just two basic ingredients — coffee and flour.