INTHEBLACK July 2025 - Magazine - Page 47
With tastes in China and other Asian
territories, including Vietnam and Thailand,
moving toward coffee, supply chain pressure
can only increase.
COFFEE AS A LOSS LEADER
Australian consumers can likely expect price
rises of A20 cents to A50 cents per cup
over the next six to 12 months, according
to Augello. However, the coffee landscape
reveals diverse pricing strategies among
different market sectors.
“We have observed retailers introduce
budget coffee options,” Augello notes.
“When they implemented this strategy,
they saw a significant increase in sales of
complementary items.
“There are also sectors in the convenience
market providing affordable coffee options,
typically around A$1 or A$2,” he adds.
Often, these establishments bundle their
coffee offerings with other popular products
to add value.
Interestingly, some major grocery retailers
have been known to offer competitive prices
on coffee. Reports indicate that certain
supermarket chains have sold a kilogram
of beans for as low as A$14.
“Are these retailers employing a
loss-leading strategy to attract more
customers into their stores?” Augello asks.
“For instance, if I’m sourcing green coffee
beans at, say A$13, and after roasting
they experience a natural weight loss
of 20 per cent, the per-kilogram value
moves to roughly A$15.85. This calculation
doesn’t even account for packaging, labour
or transportation.”
In this evolving landscape, consumers
continue to enjoy a variety of price points,
which ensures that quality coffee remains
within reach.
SEEK SUSTAINABILITY
Dramatically increasing demand calls
into question the sustainability of the
coffee sector, in terms of people, price
and environment.
Organisations such as Fairtrade
International design and implement
standards that require companies to be
independently audited and certified,
which helps to ensure better prices and
conditions for farmers.
Nestlé, which sources coffee from
a supply chain spanning 20 countries, is
supporting a more inclusive and sustainable
future from farm to cup through its
Nescafé Plan 2030.
SME businesses and suppliers such
as Cofi-Com and Bean Alliance also report
on various sustainability strategies.
In Australia, organisations such as Reground
help to reduce the carbon footprint of the
society’s caffeine habit.
“Wherever there’s a coffee machine, there
should be a Reground bin,” says Reground
founder and director Ninna Larsen.
Reground collects coffee grounds and
delivers them to community gardeners,
micro-farmers, Melbourne Zoo, and even
to RMIT University, where researchers
developed a technique to make concrete
30 per cent stronger with coffee grounds.
“Coffee grounds can either go into
supporting strong climate action and
mitigation in the community, or can have
quite a detrimental environmental impact.”
“In landfill, coffee grounds break down
and emit methane gas, which is 40 times
more potent in terms of climate change
than what comes out of cars,” Larsen says.
Through the diversion of over two million
kilograms of grounds from landfill, Larsen’s
team has prevented over four million
kilograms of carbon emissions, a
Reground report says.
“For roasters, 26 per cent to 33 per cent
of their total Scope 3 emissions come from
the disposal of coffee grounds,” she says.
“It is a very simple solution and it has
a major positive effect.” ■
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