I'll pour you an invigorating drink: Russians are switching from coffee shops to coffee at home

The coffee market in Russian catering is experiencing a noticeable decline: in March, sales fell by 20%. The reasons for the decline are attributed to rising grain prices and changing preferences of Russians. How the situation in the industry has changed, what is happening with global coffee prices and what prospects await the market — in the material of Izvestia.

How much does coffee cost?

According to the Kontur business automation services system.According to RIA Novosti, the average coffee receipt increased by 15%, while the number of sales fell by 20%. The price of cappuccino, latte and espresso increased by 8%, 6% and 4% respectively. Americano rose in price by 16%. 2.5 million checks issued at various establishments across the country between March 1 and March 31 were examined.

Izvestia made inquiries to the Ministry of Agriculture, the Ministry of Industry and Trade, as well as the Rosselkhoznadzor regarding price changes in establishments and the general market situation, but no responses had been received at the time of publication. The Rosselkhoznadzor stated that these issues do not fall within the competence of the agency.

The interviewed analysts and experts attribute the decline in sales to several factors: rising grain prices on the world market, a decrease in consumer activity, as well as a change in the preferences of Russians. Nevertheless, the coffee industry is not standing still — the specialty coffee segment is developing, which remains in demand not only in Moscow, but also in the regions.

How coffee prices have changed

Coffee prices on the world market began to rise in the fall of 2023 and have now reached record highs, Doctor of Economics, senior researcher at the Center for Agri-Food Policy at the Institute of Applied Economic Research (IPEI), told Izvestia Denis Ternovsky Presidential Academy.

— In the current conditions, it is the sellers who dictate the rules of the game, while the buyers find themselves in a less advantageous position, — the interlocutor believes.

Anton Trenin, an expert at the ACRA Corporate ratings group, agrees with him. According to him, the situation with global coffee prices in the first quarter of 2025 was characterized by record levels. In February, prices for Arabica reached $4.26 per pound (approximately $9400 per ton), and for robusta — $5,600-5,800 per ton.

— Despite a slight decrease from peak values by the end of the quarter, prices remain at extremely high levels. The main factors affecting the cost are the ongoing shortage of raw materials and the lack of significant improvement in weather conditions. Global demand growth, especially in Asia, continues to outpace supply, which keeps prices at more than twice the level of a year ago,— said Anton Trenin.

Prices will fall only by autumn

Analysts expect that the global coffee market expects prices to continue to rise, and the decline will begin by autumn. Further dynamics will depend on climatic factors and crop conditions in key producing countries such as Brazil and Vietnam, Anton Trenin emphasized.

— In a positive scenario, if the current harvest in these countries turns out to be better than expected and production stabilizes, prices may begin to decline more markedly by autumn due to a decline in stock market hype. However, a sharp drop is unlikely to be expected before the end of the year, as stocks remain low, he said.

In the next few months, coffee prices are likely to only increase, said Daniil Ivanin, chief analyst at the VMT Consult agency. A decrease in stocks of raw materials and a reduction in production volumes led to Arabica prices reaching a 47-year high in February 2025.

— Technical analysis of the current price charts shows that the Arabica and robusta markets are overbought, which may lead to a price correction in the next few months. However, fundamental factors such as ongoing supply problems and low inventories are supporting high price levels," the analyst noted.

Taking these factors into account, we predict that in April 2025 prices for Arabica and robusta will remain at elevated levels with possible periods of volatility. "Consumers should be prepared to maintain high coffee prices in retail," the analyst says.

Savings were reflected in sales in catering

The main driver of the decline in coffee sales in Russian catering is a combination of cost increases and savings, says Anton Trenin from ACRA.

— Russians, faced with the rising cost of coffee against the background of high world prices and general inflation, could reconsider their habits, preferring home consumption of the drink. People who are used to daily coffee may have preferred to buy grains or instant coffee at home, where the cost of a cup is significantly lower than in catering establishments, says Trenin.

According to him, competition with other formats, such as coffee at shops and gas stations, where prices are slightly lower than in traditional coffee shops, could draw away some of the audience. Also, the development of food and beverage delivery services could affect the habit of ordering coffee directly in these places.

However, in recent years, the specialty coffee segment has been actively developing in Moscow and other regions. These are places where high-class coffee is used in the preparation of drinks, which received a score of 80 points or higher on the one-hundred-point scale of the Specialty Coffee Association (or SCA), said Daniil Ivanin.

The prices of raw materials for this type of coffee shops are also rising due to the general increase in the cost of raw materials.

In Moscow and St. Petersburg, specialty coffee shops are an established trend that has a loyal audience, and in large cities this segment is actively developing and gaining popularity, Anton Trenin also noted.

The analyst believes that in small towns, this type is still less developed due to low awareness of the specialty culture and a preference for more affordable coffee against a background of lower purchasing power, although the segment has the potential for some growth.

— In the whole country, the share of such coffee shops is relatively small, including due to the higher cost of drinks, — the expert summarizes.