Pablo & Rusty's CEO Abdullah Ramay argues that coffee prices in Australia should be closer to $7, stating that cafes have been subsidizing the cost for customers. He emphasizes that a quality coffee is a service, not a commodity, and that rising input costs have made it unsustainable for cafes to maintain current prices. While the average price of a cup in Australia is $4.83, it's significantly lower than in countries like the UK ($6.31) and the US ($7.41).
If you’re paying anything less than $5.50 for a small cappuccino in Australia, coffee roaster Pablo & Rusty’s chief executive Abdullah Ramay reckons you’re getting a great deal.
That’s without factoring in the rising cost of coffee itself, which only comprises 56¢ – or 11.5 per cent – of a cup that costs $4.88, according to Pablo & Rusty’s calculations. The price of a cup in Australia, at an average of $4.83, is notably lower than what you’ll find in other countries such as the UK or the US , data from payment business Square shows.
“They’re not insolvent,” he said. “They’re like, ‘this is too hard … I can’t make this work, here’s your lease back’.”The global commodity price of arabica coffee broke all-time highs in mid-December, hitting nearly $US3.50 a pound to its highest level since 1972. Unfavourable weather conditions in Brazil and Vietnam – which together make up about half the world’s coffee production – over consecutive years have resulted in a global shortfall.
“The big companies need to be making sure that they will have supplies to keep going in the months ahead, just in case some of the crops come off even worse than forecast.cocoa went to record highsAustralia-based coffee roaster Toby’s Estate, which sources 80 per cent of its coffee beans directly from growers, is seeing climate change affecting where farmers are planting coffee trees.
Long-standing supplier relationships and higher-than-market rates ensures specialty roasters such as Toby’s are at the top of the pyramid.“ there’s not enough coffee to go around, we’re going to get priority because we’ve been around forever. We’ve worked with these guys and paid the rates that we’ve been paying all along, which is above commercial grade coffee levels,” said Toby’s Estate general manager, Jody Leslie.
Like Ramay, Coghlan has heard anecdotes of cafe operators who aren’t deep in the red or are in debt opting to close their doors.
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