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It's Not Just Eggs. Your Morning Coffee Is Likely To Get More Expensive, Too.
Coffee prices are likely to rise in 2025, Bank of America said in a note.
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- Egg prices are spiraling, but it's not the only morning staple under pressure.
- Bank of America says coffee is likely to get more expensive in 2025 amid weak crop yields.
- Arabica coffee prices closed at a record of $4.04 last week.
Eggs aren't the only breakfast staple getting more expensive.
Coffee prices are also on the rise and are set to climb even higher this year thanks to supply snags that could exacerbate a bean shortage, Bank of America analysts said.
In a note on Monday, the analysts pointed to the growing shortage of arabica beans. Arabica coffee prices closed at an all-time high of $4.04 a pound on Friday, up by 26% since the fourth quarter, when prices hovered around $3.20, the bank said.
Bank of America noted that arabica coffee prices closed at a record high on Friday.Bloomberg/Bank of America
The prices of coffee pods and drip coffee are also near record highs. Bank of America's analysis found that the price of a mainstream coffee pod was about $0.55 in 2024, above a key threshold of $0.50.
The price of a mainstream coffee pod has climbed past a key threshold of $0.50.Bank of America
The price of drip coffee, meanwhile, ticked up to $0.14 a cup last year, up from $0.13 in 2023.
The price of drip coffee has ticked higher in recent years.NielsenIQ/Bank of America
The bank said it expected the coffee supply shortage to get worse, pointing to recent poor harvests and potential issues later this year.
Robusta coffee shipments from Vietnam plunged by 45% in November thanks to a drought that affected the crop yield.
The bank described the outlook for coffee crops in Brazil as "uncertain," pointing to the potential for unfavorable weather in February and March.
"Expect retail coffee prices to keep grinding higher," the analysts wrote.
Food inflation has been on the rise in recent years, partly due to extreme weather events. In the US, food prices rose by 2.5% year over year in December. Researchers behind a study published last year see a worst-case scenario in which food prices rise by more than 4% a year in the coming decades.
Read the original article on Business Insider
