Coffee has been one of the most volatile items in South Africans\u2019 shopping baskets over the past few years, with prices rising far faster than most other foods and drinks.<\/p>\n\n\n\n
Instant coffee in particular has seen sharp increases, driven by supply problems in major coffee-producing countries and higher production costs.<\/p>\n\n\n\n
In August 2024, instant coffee prices increased by 22.3% year-over-year, and since 2022, the category has risen by 35.7% overall\u2014adding around R600 to household spending each year.<\/p>\n\n\n\n
Ground coffee and beans increased more slowly at 13.6%, but instant coffee drinkers were hit the hardest.<\/p>\n\n\n\n
Most of the price pressure came from poor harvests in key producing regions. Brazil, which produces almost 40% of the world\u2019s coffee, had a weak 2023 harvest after heavy rainfall in Minas Gerais caused pest and disease outbreaks.<\/p>\n\n\n\n
Vietnam, the top producer of robusta beans used in instant coffee, faced two years of drought and extreme heat, leading to consistently low yields.<\/p>\n\n\n\n
These problems, combined with global supply chain disruptions, pushed international coffee prices sharply higher.<\/p>\n\n\n\n
Andrew Fulton, Director at Eighty20, explained that the impact was immediate. \u201cMy own personal favourite went from R400 a bag to R800 a bag,\u201d he said, adding that the increase \u201cpriced me out of it completely.\u201d<\/p>\n\n\n\n
Although 2024 brought another shock, prices have started to stabilise. Fulton noted that coffee prices had moderated since then and that overall inflation has cooled. <\/p>\n\n\n\n
However, coffee is still expensive relative to other goods. With CPI at 3.6%, instant coffee prices are still rising by around 10% a year.<\/p>\n\n\n\n
Fulton pointed out that this is an improvement from the more than 20% increase seen a year earlier, but it remains far above the general inflation rate.<\/p>\n\n\n\n
Understanding coffee inflation has also become more complicated because Stats SA recently updated the CPI basket.<\/p>\n\n\n\n
\u201cThey recalibrated the basket for CPI, and they actually removed ground coffee,\u201d Fulton said.<\/p>\n\n\n\n
Ground coffee previously recorded inflation of about 13.6%, but it has now been replaced with ros\u00e9 wine and snuff.<\/p>\n\n\n\n
That leaves instant coffee as the only coffee item officially monitored, even though it doesn\u2019t represent the full market.<\/p>\n\n\n\n
Despite high prices, demand is recovering. After shrinking during the steep increases, coffee consumption has bounced back. <\/p>\n\n\n\n
\u201cCoffee consumption in South Africa has gone up by 8% in the last year,\u201d Fulton said. Global production has also reached record levels, helping to ease some pressure.<\/p>\n\n\n\n
Despite this, many households still feel the strain. While the worst spikes are over, a 10% annual increase\u2014nearly three times the CPI\u2014means coffee remains a costly part of the monthly shopping budget.<\/p>\n\n\n\n
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