“Tsunami! » The weather report compiled by Giuseppe Lavazza, vice president of the Italian roastery, which bears his name, is somewhat grim. Black Grain Coffee Warning… The sector first took the full brunt of the Covid-19 crisis with a complete shock in consumer habits. No more outages at the counter or breaks in front of the coffee machine. Make room for a homemade drink. Although in the end, despite the disrupted flows, the coffee continued to flow.
A new blow from Trafalgar, in the spring of 2021. Black frost falls on a Brazilian coffee plantation. A phenomenon that usually occurs every ten years. The world’s leading producer and exporter, also affected by the drought, has fallen by 24% compared to the record harvest of 2020. This ristretto grain harvest has caused world prices to rise over the months. At the beginning of December 2021, the price of the most popular Arabica variety reached $ 2.50 (2.24 euros) per pound. Ten-year maximum. “When you have a 100% price increase, it’s a tsunami”Mr. Lavazza is worried.
A new part of the black series for coffee at the end of February with the invasion of Ukraine by Russian troops of Vladimir Putin. Prices of energy, packaging, transport, fertilizers have skyrocketed, and tensions over supplies have intensified. What put the roasters under pressure. “We have reviewed our budget six times. This very fast inflation is unparalleled in the company’s history., says Mr Lavazza, who refuses to make any forecasts for the year, even if the Turin family business’s turnover is to reach record levels at the end of the year, higher than the € 2.3 billion achieved in 2021. 19. But Margin could drink the cup.
The rise is not yet in sight. “Although good production volumes are expected in Brazil this year and the coffee trees have recovered well from the frost episode in 2021, it will not be enough to restore stocks. Prices will remain high, mainly because producers are affected by rising fertilizer prices »analyzes Mr. Lavazza, who predicts that dark clouds will persist in the coffee market until 2023. The Arabian pound is currently trading at $ 2.26 on the New York Stock Exchange.
Not surprisingly, the consumer drinks through a game of communicating containers. Between pasta, oil, flour, burgers, butter, chicken and semolina, coffee slips into the basket of food whose prices have risen the most in supermarkets. Lavazza, owner of the Carte Noire brand in France, expects an increase of 8 to 10% on the shelves this year. We’ll see if customers extend the change to continue drinking their favorite coffee…