Surging prices for coffee beans on international markets are putting a strain on South Korean coffee shop operators. (Image courtesy of Yonhap)
SEOUL, May 22 (Korea Bizwire) – Surging prices for coffee beans on international markets are putting a strain on South Korean coffee shop operators, raising concerns that the higher costs could lead to increases for consumers.
The price of robusta coffee beans has more than tripled since 2020 to $3.97 per kilogram last month, according to the Ministry of Agriculture, Food and Rural Affairs. Though the price eased slightly to $3.67 this month, it remains elevated.
The price for arabica beans has doubled over the same period, reaching $2.21 per pound last month and holding around $2 this month.
Drought and other supply disruptions that have curtailed production are largely behind the price spikes.
Some worry the higher bean costs will force coffee chains to raise prices. The Venti, a chain of coffee shops that specializes in affordable brews, lifted prices on seven menu items by 200 to 500 won in late April.
To gauge the impact, agriculture officials visited the Ediya coffee company to assess bean supply conditions and hear directly from operators. An Ediya representative told them soaring international prices were creating difficulties and urged government support.
“Considering the high volatility of coffee bean prices from climate change and other factors, we will look at options like extending tariff rate quotas,” said Yang Joo-pil, the director of the Ministry of Agriculture and Rural Affairs’ Food Industry Policy Bureau.
The government has already extended a value-added tax exemption on coffee imports through 2025 and applied a zero percent tariff rate quota in the first half of this year to ease cost pressures on the industry.
Yang called on restaurant operators to “make utmost efforts to absorb factors behind price increases through cost-cutting and other measures,” given the government’s support policies.
Ashley Song (ashley@koreabizwire.com)
