logo
Yet more price hikes on a cup of coffee could be on the way

Yet more price hikes on a cup of coffee could be on the way

Irish Times22-04-2025

Coffee drinkers face could face further price rises as reduced harvests from key producers continue to drive up prices, restaurants warn.
Cafes are now charging up to €4 for a cup of regular coffee after sustained price rises since 2020, when consumers were paying about €2.50 or €3.
Pressure on prices could remain, according to industry body the
Restaurants Association of Ireland (RAI)
, which says global demand continues growing while weather hits harvests in Brazil, Vietnam and India, which produce much of the world's coffee.
'For Irish cafes and restaurants already operating on tight margins, the sustained increase in the cost of importing coffee has become particularly challenging,' the association said.
READ MORE
Antonio Baravalle, chief executive of leading Italian producer Lavazza, recently argued that prices – up to £4 in London for an espresso – are at the limit of what shoppers will pay.
[
Cost of living: 'You are going to see €5 lattes in Ireland by the end of the year'
Opens in new window
]
He blamed speculation on commodities markets and volatile weather for the high prices in an interview with The Financial Times.
The gap between Lavazza's costs and earnings shrank to 9.3 per cent in 2024 from 11 to 12 per cent three years ago, as the company absorbed some raw material increases, Mr Baravalle noted.
According to the RAI, climate and logistical challenges have hit production while global appetites for coffee increase rapidly.
'This mismatch is pushing prices higher across all grades of coffee. Restaurants and cafes in Ireland are doing their best to absorb these increases,' the RAI added.
'However, when rising coffee import costs are combined with soaring energy bills and the already high cost of doing business, it becomes increasingly difficult to make a margin on anything, coffee included.'
An RAI member told the organisation that the cost of buying coffee has risen 40 per cent in the past year alone.
The trend began during the Covid-19 pandemic, when lockdowns boosted transport costs, an association spokesman explained.
Meanwhile, the London-headquartered International Coffee Organisation calculates that consumption in China alone rose 15 per cent in the 12 months to September 30th, 2023.
'1 in 5 US households consume Kerrygold' – Ornua CEO Conor Galvin
Listen |
33:47
Rabobank predicts that Brazil's 2025/26 harvest could drop 6.4 per cent to 62.8 million bags – each a bag of 60kg – after dry, hot weather hit production.
Analyst Guilherme Morya said Brazil exported 3.3 million bags in March, 25 per cent less than during the same month last year.
Exports for the first three months of this year slid 11 per cent to 10.7 million bags.
'The situation may improve with the arrival of the 2025/26 Brazilian harvest in the second half of the year,' Mr Morya suggested.
The RAI maintains it is impossible for members to absorb extra costs. The pledged reinstatement of the 9 per cent hospitality VAT rate by the Government from next January 'cannot come soon enough', it said.

Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Griffdon Engineering to create 48 new jobs in Ballaghaderreen
Griffdon Engineering to create 48 new jobs in Ballaghaderreen

RTÉ News​

timean hour ago

  • RTÉ News​

Griffdon Engineering to create 48 new jobs in Ballaghaderreen

Griffdon Engineering, a family-run electrical engineering company, is to create 48 new jobs at its headquarters in Ballaghaderreen, Co Roscommon. Griffdon already employ 350 people and provides services to semiconductor and pharmaceutical industries, the oil and gas and renewable energy sectors, and ICT firms involved in data centre construction. The creation of the new jobs is being supported by Enterprise Ireland's Company Development Fund while Leirim based not-for-profit Future Cast helped to secure the Funding. The company's growth is expected to boost local employment and enhance skills in the electrical service and maintenance sector. It also aims to capitalise on the growing need for support among multinationals in the tech, pharmaceuticals and agrifood industries. Griffdon Engineering is led by Managing Director Seamus Griffin and EHS Director Elayne Griffin, the son and daughter of company founders Martin and Mary Griffin. The siblings took over the running of the company in 2017. Since then, the company has grown considerably, taking on large scale projects in Ireland and across Europe. Director of Griffdon Engineering Seamus Griffin said Enterprise Ireland has paid a pivotal role in supporting Grifdon to reach this milestone in the company's growth. "Enterprise Ireland's commitment to fostering innovation and strengthening Irish enterprise has empowered businesses like ours to invest with confidence, create high-quality employment, and contribute meaningfully to our regional and national economy," said Mr Griffin. "This is a proud day for Griffdon Engineering, for Ballaghaderreen, and for the wider community. We are excited to build on this momentum and look forward to what we can achieve—together."

World Bank slashes global growth forecast as trade tensions bite
World Bank slashes global growth forecast as trade tensions bite

RTÉ News​

timean hour ago

  • RTÉ News​

World Bank slashes global growth forecast as trade tensions bite

The World Bank has slashed its global growth forecast for 2025 by 0.4 percentage point to 2.3%, saying that higher tariffs and heightened uncertainty posed a "significant headwind" for nearly all economies. In its twice-yearly Global Economic Prospects report, the bank lowered its forecasts for nearly 70% of all economies -including the United States, China and Europe, as well as six emerging market regions - from the levels it projected just six months ago before US President Donald Trump took office. PresidentTrump has upended global trade with a series of on-again, off-again tariff hikes that have increased the effective US tariff rate from below 3% to the mid-teens - its highest level in almost a century - and triggered retaliation by China and other countries. The World Bank is the latest body to cut its growth forecast as a result of President Trump's erratic trade policies, although US officials insist the negative consequences will be offset by a surge in investment and still-to-be approved tax cuts. The bank stopped short of forecasting a recession, but said global economic growth this year would be its weakest outside of a recession since 2008. By 2027, global gross domestic product growth was expected to average just 2.5%, the slowest pace of any decade since the 1960s. The report forecast that global trade would grow by 1.8% in 2025, down from 3.4% in 2024 and roughly a third of its 5.9% level in the 2000s. The forecast is based on tariffs in effect as of late May, including a 10% US tariff on imports from most countries. It excludes increases announced by PresidentTrump in April and then postponed until July 9 to allow for negotiations. The bank said global inflation was expected to reach 2.9% in 2025, remaining above pre-COVID levels, given tariff increases and tight labor markets. "Risks to the global outlook remain tilted decidedly to the downside," the bank wrote. It said its models showed that afurther 10-percentage point increase in average US tariffs, on top of the 10% rate already implemented, and proportional retaliation by other countries, could shave another 0.5 percentage point off the outlook for 2025. Such an escalation in trade barriers would result "in globa ltrade seizing up in the second half of this year ... accompanied by a widespread collapse in confidence, surging uncertainty andturmoil in financial markets," the report said. Nonetheless, it said the risk of a global recession was less than 10%. 'FOG ON A RUNWAY' Top officials from the United States and China are meeting in London this week to try to defuse a trade dispute that has widened from tariffs to restrictions over rare earth minerals, threatening a global supply chain shock and slower growth. "Uncertainty remains a powerful drag, like fog on a runway. It slows investment and clouds the outlook," World Bank Deputy Chief Economist Ayhan Kose told Reuters in an interview. But he said there were signs of increased dialogue on trade that could help dispel uncertainty, and supply chains were adapting to a new global trade map, not collapsing. Global trade growth could see a modest rebound in 2026 to 2.4%, and developments in artificial intelligence could also boost growth, he said. "We think that eventually the uncertainty will decline," he said. "Once the type of fog we have lifts, the trade engine may start running again, but at a slower pace." Kose said while things could get worse, trade was continuing and China, India and others were still delivering robust growth. Many countries were also discussing new trade partnerships that could pay dividends later, he said. US GROWTH FORECAST CUT SHARPLY The World Bank said the global outlook had "deteriorated substantially" since January, mainly due to advanced economies, now seen growing by just 1.2%, down half a point, after expanding 1.7% in 2024. The US forecast was slashed by 0.9 percentage point from its January forecast to 1.4%, and the 2026 outlook was lowered by 0.4 percentage point to 1.6%. Rising trade barriers,"record-high uncertainty" and a spike in financial market volatility were expected to weigh on private consumption, trade and investment, it said. Growth estimates in the euro area were cut by 0.3 percentagepoint to 0.7% and in Japan by 0.5 percentage point to 0.7%. It said emerging markets and developing economies were expected to grow by 3.8% in 2025 versus 4.1% in January's forecast. Poor countries would suffer the most, the report said. By 2027 developing economies' per capita GDP would be 6% belowpre-pandemic levels, and it could take these countries - minus China - two decades to recoup the economic losses of the 2020s. Mexico, heavily dependent on trade with the U.S., saw its growth forecast cut by 1.3 percentage points to 0.2% in 2025. The World Bank left its forecast for China unchanged at 4.5% from January, saying Beijing still had monetary and fiscal space to support its economy and stimulate growth.

Boots Ireland report record revenues of €580.76m
Boots Ireland report record revenues of €580.76m

RTÉ News​

timean hour ago

  • RTÉ News​

Boots Ireland report record revenues of €580.76m

Strong growth in online sales and a rise in demand for vaccination services contributed to the Irish arm of pharmacy giant, Boots enjoying record revenues of €580.76m last year. New accounts filed by Boots Retail (Ireland) Ltd show that on the back of the record revenues, pre-tax profits increased by 3% to €37.8m. In the 12 months to the end of August last, revenues surged by €51m or 10% from €529.63m to €580.76m. The pre-tax profits of €37.8m follow pre-tax profits of €36.56m in fiscal 2023. The company opened one new outlet during the year bringing the store network to 95. During the year, the company paid out dividends of €29m after paying out a dividend of €48.2m in 2023. The directors state that retail revenues made up 87.4% of total revenues with pharmacy revenues making up the remaining 12.6%. Comparable retail revenues increased by 7.2% "as a result of strong growth in online sales". They state that pharmacy revenues increased by 10.2% "mainly due to volume growth in relation to Government schemes and service growth due to the rise in demand for vaccination services". The directors state that the company's business is affected by a number of factors including its sales performance during holiday periods, including particularly the winter holiday season, and during the cough, cold and flu season. Other factors include significant weather conditions, the timing of its own or competitor discount programmes and pricing actions and the timing of changes in levels of reimbursement from governmental agencies. The firm recorded a post tax profit of €31.46m after the company incurred a corporation tax charge of €6.34m. Numbers employed increased from 1,630 to 1,668 as staff costs increased from €72.29 million to €77.24m. The profits take account of non-cash depreciation costs of €25m and non-cash impairment charges of €2.36m. Remuneration paid to directors last year increased marginally from €1.04m to €1.05m and the highest paid director received €491,000 made up of €352,000 in pay, €103,000 under long term incentive schemes and €36,000 in pension contributions. The higher post tax profits offset by the dividend payout resulted in shareholder funds increasing from €132.92m to €134.46m that included accumulated profits of €31.46m. Cash funds increased from €5.3m to €6.9m. On the risks facing the business, the directors state that "the impact of the current global cost pressures has resulted in high inflation rates in the Republic of Ireland and globally, and this has been exacerbated by the ongoing conflict between Russia and Ukraine. The directors state that "these factors have contributed to a cost of living crisis within the Republic of Ireland which could impact various stakeholders as well as the business".

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into the world of global news and events? Download our app today from your preferred app store and start exploring.
app-storeplay-store