Why Is Coffee Expensive? - Perspective

Coffee prices ARE rising and they aren't going to stop at the predicted $7 a coffee. Most of the public's immediate reaction has been to batten down the hatches like it's the end of the world, or to confront cafe owners about the level of extortion that seems to be going on. 

What if I told you that it’s not the cafe owners choice? What if I told you that the price hike is not just good for farmers around the world, that it is also in the grand scheme of things good for you? 

Coffee has been marketed to us ONE WAY for roughly 60 years, and that has been cheap fuel to boost you up in the morning. Major companies have profited for decades by selling the cheapest and crudest coffee beans available to you at astonishingly low prices, so much so that we have all settled into what we think coffee should be. We have a full blog outlining why the price of coffee NEEDS to be higher than it already is, you can read all about it HERE. 

Coffee is so much more than just fuel. Coffee is one of the oldest known drinks the world has ever sipped, embedded into almost every culture on Earth. Spanning continents and centuries, coffee’s effect is more than just a boost, it is a lifestyle. So why do we treat coffee the way that we do? 

We COULD just take caffeine tablets. You can buy them from pharmacies for about $12 AUD and get 100 tablets. That’s 12c a tablet for a caffeine kick of roughly 200mg of pure caffeine, which is equivalent to 4 cups of coffee!

You could be saving hundreds of dollars each month just by popping a little pill that keeps you ready to go, yet coffee itself is so much more than caffeine. In fact caffeine only makes up 2% of the chemical compounds found in coffee, and the rest of the 98% is what makes it so good and is the reason we keep coming back to coffee itself. 

A cup of coffee at home is surprisingly cheap! You cut out all of the overheads a cafe has to pay just by brewing yourself at home! Let’s say we have a kilogram of our high quality Costa Rican Coffee which retails around $100/kg. At first glance you could be forgiven in thinking that is way too much for a kilogram of anything. Let’s dissect the price of this coffee and find out JUST HOW MUCH it’s costing you per cup. 

On average, people are putting roughly 20g of coffee per basket. You could argue that some people run 16g baskets and only run single shots, but there are plenty of home baristas out there that follow the commercial standard of 22.5g per basket running double shots ALL THE TIME.

So let's meet halfway at 20g per basket. That’s 50 double shot coffees you can get out of your 1kg bag of coffee, or better yet that could be 100 single shot coffees. If you price that at the double shot standard, that comes to a total of $2 a coffee at home! Add in some milk and you are looking at no more than $2.50 per cup of coffee. 

If you are to take the same principle to a bottle of wine, the price points are monumentally different. You walk away from the liquor store with a $30 bottle of wine. It can be very easy to walk away with a $50 bottle that will taste much better, however lets keep an average price at $30. 

A bottle of wine is usually 750ml. Which (to a legal standard drink size of 150ml or 5oz) creates 5 glasses of wine. 5 glasses off the one $30 bottle makes it $6 a glass! AT HOME! If you were to take that out to a restaurant you would be charged a corkage fee per head ON TOP OF THAT! Not to mention the markup on the same bottle of wine the restaurant will charge you to purchase there, which is usually $10-$15 a glass! 

So why is there a 300% price difference between the two drinks?

The answer is perception. We have been told that wine is a luxury experience and coffee should be cheap. We have been marketed to believe that coffee should taste terrible and wine should taste amazing no matter the brand. We have been brainwashed to think that coffee is fuel and wine is opulence. 

We now need to shift our focus, reposition our perspective and change the way we see coffee. The industry and the world is changing for the better, it is now up to us as consumers to understand and accept this change as we all move forward to a better tomorrow.