The Rising Cost of Your Morning Flat White: What You Need to Know
If you’ve noticed your morning flat white getting pricier, you’re not imagining things. The unfortunate reality is that these costs aren’t likely to decrease anytime soon.
The C-market - the global benchmark for trading arabica coffee, has been on a wild ride upwards over the past two years, and the trend shows no signs of slowing down. As of February 2025, arabica futures have surged past $4 per pound, a significant leap from $3.44 in early 2024 and a staggering increase from just $1.96 in 2023. That’s more than a 100% rise in just two years—and for coffee lovers, it’s a big deal.
This dramatic increase can be attributed to a combination of factors, including climate change, supply chain disruptions, and increased demand for high-quality coffee. As producers face challenges in growing and harvesting coffee beans, the impact is felt all the way to your favourite café.
So, what does this mean for your daily caffeine fix? Expect to see continued price adjustments as coffee shops and roasters strive to maintain quality while navigating these rising costs. While it may be disheartening to see your beloved flat white becoming more expensive, understanding the market dynamics can help you appreciate the craftsmanship and effort that goes into every cup.
The Coffee Market Rollercoaster: What’s Driving Prices Up?
The C-market, set by the Intercontinental Exchange (ICE) in New York, serves as the global benchmark for green (unroasted) arabica coffee prices. Think of it as the stock market for coffee—where prices fluctuate based on supply, demand, weather conditions, and market speculation. The price established here directly influences what farmers earn and, ultimately, what you pay for your daily brew.
Weather Woes and Supply Strains
First and foremost, let’s talk about the weather. Brazil, the world’s largest producer of arabica coffee, has been grappling with extreme droughts that have severely cut yields, tightening the global supply. Meanwhile, in Vietnam, the leading producer of robusta coffee, heavy rains during the harvest season have damaged crops, driving up robusta prices. This situation has forced many roasters to pivot back to arabica, further straining its availability.
Rising Demand
On the flip side, demand for coffee continues to soar globally, particularly for specialty brews. As more consumers seek high-quality coffee experiences, the equation becomes clear: fewer beans combined with increasing demand equals higher prices. In fact, demand has outstripped production for several years now, and The World Coffee Research industry trade group predicts that in less than two decades, demand could exceed supply by a staggering 35 million bags.
The Bigger Picture
But it’s not just about the weather. Climate change, ongoing supply chain disruptions, and economic pressures are all squeezing the coffee market. According to Trading Economics, coffee prices surged over 20% in 2025 alone, hitting the $4 per pound mark on February 6th, and continuing to trade upwards, opening at a high of $4.29 as of February 11th, 2025.
Industry experts are sounding the alarm that these price fluctuations are here to stay. As reported by Reuters, India’s coffee exports are projected to drop by over 10% in 2025, adding even more pressure to an already tight supply chain.
What Lies Ahead?
So, what’s next for coffee lovers? The short answer is: we don’t know. If weather conditions improve, production might stabilize, but with the unpredictability of climate change and the relentless rise in demand, prices could continue to climb. One thing is for certain—your morning cup of coffee is becoming an increasingly valuable commodity, both literally and figuratively. As we navigate this evolving landscape, it’s essential to appreciate the journey of each bean that makes its way into your cup.
Cheers to the complexities of coffee!
