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The Rising Price of Coffee

The Rising Price of Coffee
Have you been to your local café or supermarket and seen the increased price of goods? The cost of life seems to be going up and we feel you!
As the cost of living continues to soar, our everyday necessities are quickly skyrocketing in price too. Why you ask? There are a few things at play here which are affecting businesses within every sector, no one can escape these rising pressures. With energy and petrol on a rapid increase, interest rates on the rise, increased cost of freight mixed in with climate change, the coffee sector is also facing some extreme challenges which is affecting the price of your favourite coffee.

According to Xanthe Gregory (ABC NEWS), The Coffee C contract (the world’s benchmark for Arabica coffee) has doubled from approximately $1.24 USD to $2.40 USD within one year. This poses a great risk to coffee roasters, coffee farmers & café owners worldwide, with some cafés now charging up to an extra 50 cents for your morning cuppa.

The global coffee sector is facing a worldwide shortage of beans which has largely been caused by the frosts in Brazil (the world’s largest exporter of beans) and produced one of the lowest harvests on record (Tatiana Freitas, Bloomberg). Adding to this, is the increased cost of shipping which has resulted in Brazilian producers selling to the domestic market rather than exporting the goods. As goes with supply and demand, when demand outweighs supply, it causes the prices to rise significantly which is why we are seeing the price at a 40 year high.

COVID saw the rise in online shopping in lockdowns alongside shelves stripped bare of essentials. This caused increased production and shipping to keep up with demands and ultimately, saw the price of shipping increase exponentially. Pair this with a backlog of shipping orders and containers in ports, and we have an ongoing problem that is disruptive to the whole supply chain which directly affects the cost of goods, be it coffee or any other essential.

Aside from scarcity of beans, Jordyn Beazley and Peter Hannam of the Guardian, explains the rising cost of so many crucial crops and materials is a result of international events, such as the war in Ukraine, which has lead to immense price pressures on food and fuel. Additionally, ongoing COVID-19 lockdowns in China have backed up the supply chain causing significant back-log.

It is unquestionably a challenging time at the moment as individuals, families and businesses are navigating an unpredictable period. Staffing shortages, supply challenges, rising cost of goods, freight, petrol & energy are all having an impact. We have worked hard to do our best to minimize the impact here at St Remio, and while some of our products have increased in price to mitigate against these rising costs, we have worked hard to keep some of our products (such as coffee capsules) at the same price to ensure you continue to enjoy great coffee at an affordable price. Despite the challenges facing our sector, we continue to only purchase sustainable coffee and support the farmers, because if we don’t support them in the most challenging times, then we are not protecting the industry for the future.

Thank you for your ongoing support of St Remio. And to our new customers, thanks for being part of the positive movement that is making a difference to farmers at origin. While life is definitely hard at the moment, isn’t it great to know that your choice of coffee is doing something positive for someone else. In these crazy times, it’s nice to pay it forward.

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