"Let's go here after lunch"... Famous 'Coffee Hama' Korean, Decision on Priceless Coffee Beans [Jumeoni Talk]

How Long Will Prices Rise... Coffee Bean Prices Soar Due to Poor Harvests
'Coffeeflation' Boosts Convenience Store Coffee

Editor's NoteIt is an era where one serving of Samgyeopsal costs 20,000 won, and a bowl of Jajangmyeon is 7,500 won. The consumer price index for 2024 stands at 114.18 (2020=100), and in 2025, the burden on consumers' shopping baskets has increased due to continued high inflation. Through the series Pocket Talk (Week+Money+Talk), we aim to share stories about consumption closely connected to our wallets amid rapidly changing prices.

Coffee bean prices continue to rise. Pixabay

As coffee bean prices have doubled over the past year, coffee shops feeling the cost pressure are raising beverage prices one after another. Even low-cost coffee franchises that emphasize cost-effectiveness have increased their beverage prices, leading consumers who prioritize value for money to turn to 'convenience store coffee' as an alternative.

How Long Will Prices Rise... Coffee Bean Prices Soar Due to Poor Harvests

According to the Korea Agro-Fisheries & Food Trade Corporation (aT) Food Industry Statistics Information as of the 20th of this month, the average price of Arabica coffee beans in March was $8,680 per ton (approximately 12.75 million won), a roughly 110% increase from $4,088 per ton (about 6 million won) in March last year. Robusta beans, mainly used for instant coffee, also rose 65.2% during the same period, from $3,330 (about 4.89 million won) to $5,500 (about 8.08 million won).

The sharp rise in coffee bean prices is due to poor harvests in major producing regions caused by abnormal weather. Brazil, the largest producer of Arabica beans, experienced a severe drought and heatwave last year, drastically reducing coffee production. Arabica thrives in cool climates between 18 and 21 degrees Celsius, but Brazil faced abnormal high temperatures reaching up to 30 degrees Celsius last year.

Vietnam, the main producer of Robusta beans, also suffered from droughts and heavy rains due to the El Ni?o phenomenon (warming of the eastern Pacific Ocean surface) last year. In particular, the super typhoon 'Yagi' in September last year, which caused over 200 casualties, inflicted significant damage on coffee plantations.

The problem is that there are no adequate measures to respond to the reduced coffee bean supply. Coffee beans are vulnerable to climate change, and it takes 3 to 5 years from planting seedlings to harvesting green beans. Moreover, Vietnamese farmers switching from coffee trees to more profitable crops like durian is another factor contributing to supply reduction. Accordingly, the coffee industry expects coffee bean prices to remain unstable for the foreseeable future.

'Coffeeflation' Boosts Convenience Store Coffee

Citizens are walking down the street holding coffee in Sogong-dong, Jung-gu, Seoul. Photo by Jo Yong-jun jun21@

Domestic coffee franchises are responding to rising coffee bean prices by consecutively raising beverage prices. The low-cost coffee franchise The Venti increased the price of iced Americano (Venti) from 1,800 won to 2,000 won, and decaffeinated Americano from 2,300 won to 2,600 won earlier this month, marking increases of 11.1% and 13%, respectively. In January, Starbucks Korea, Hollys, and Paul Bassett raised menu prices, followed by Pascucci and Compose Coffee implementing price hikes last month.

According to market research firm Euromonitor, the annual per capita coffee consumption in Korea was 405 cups in 2023, about 2.7 times the global average of 152 cups. As coffee consumption becomes a daily habit, rising coffee prices increase the burden on consumers.

Consumers are turning to relatively affordable convenience store coffee as an alternative, leading to a surge in convenience store coffee sales.

Currently, most coffee sold at domestic convenience stores is priced in the 1,000 won range for an Americano. CU's 'Get Coffee' sold approximately 230 million cups last year. This averages about 19 million cups per month and roughly 630,000 cups per day. GS25's 'Cafe25' saw sales increase by 15.9% compared to the previous year. On the 13th of this month, Emart24 launched the ultra-cost-effective pouch coffee '1000 Black Coffee' in time for the outing season, intensifying the competition among convenience stores to sell large-capacity pouch coffee.