Dec. 29, 2025 "Why your cup of coffee costs so much more now": Today I found this article by Ritika Dubey on BNN Bloomberg:
OAKVILLE — As a stream of roasted coffee beans drops into a barrel, it fills an Oakville, Ont., roastery with a smell practically strong enough to caffeinate you.
The roasted beans, now a rich, deep brown, were once small and green, bagged in large burlap sacks and shipped to Canadian ports from the coffee-producing countries of
Ethiopia,
Colombia
and Brazil.
It’s at Reunion Coffee Roasters where they find their defining character.
The strength of your brew
and whether it will taste fruity
or earthy
is methodically decided at the roastery’s lab,
where they sample various beans
and perfect the taste.
Walking through his roughly 50,000 sq. ft. roastery, Reunion president Adam Pesce points out industry-scale machines where the green beans are
washed,
weighed
and roasted
to get the preferred
colour,
flavour
and aroma.
“Coffee roasting is a lot like baking,”
said Pesce, a second-generation coffee roaster.
It’s all about perfecting the
temperature,
roast time
and airflow.
Each batch of beans, weighing about 460 pounds,
is roasted at 450 degrees in a rotating drum for a period of time,
usually a little more than 10 minutes,
before being dumped into a cooling chamber to preserve their flavour.
The roastery processes 37,500 pounds of coffee a week.
While the roasting process hasn’t changed drastically over the years,
the coffee industry has.
Import prices for unroasted coffee beans have more than doubled over the past three years,
according to an analysis from KPMG,
as a combination of factors led to supply shortages.
The rising cost is forcing
importers,
roasters,
retailers
and consumers
to adapt.
Statistics Canada data shows shoppers paid 27.8 per cent more for coffee at the grocery store in November compared with a year earlier
— greatly outpacing overall food inflation,
which was 4.7 per cent year-over-year.
“This is by far the most difficult time that the industry has ever seen,” said Pesce, who said that 20 years ago when he got into the business, a seven or eight per cent price fluctuation would have been considered meaningful.
Put another way, he said,
a pack of mediocre coffee today sells for more
than the best quality coffee did two years ago.
“Think about how disruptive that can be.”
Coffee is grown in rainforests
and hand-picked primarily by small-scale farmers.
Often, farmers who don’t have an export license
sell to collectors by the roadside in small batches,
which are then bundled for international buyers.
Beans are sold by smaller operators to
processors,
importers,
roasters
and other intermediaries
before reaching the consumer,
said Ted Salter, executive director of supply chain at KPMG in Canada.
But climate change,
drought
and crop disease
have disrupted the global supply at the source,
hurting many small farmers,
Salter said.
With limited crops,
global demand for coffee
has outpaced supply.
The trend is expected to continue
unless the highly fragmented global farmers’ community is able to
implement costly irrigation solutions.
While climate change is a big factor in coffee price increases,
importer Jeff Fleming said
farmers are dealing with an affordability crisis
alongside the high costs of operating small coffee farms.
Often, changing government policies on exports in the origin countries also push the prices higher for coffee — something an importer can’t control.
Fleming, founder of Calgary-based Apex Coffee Imports, works directly with farmers and exporters across 11 countries to buy their coffee,
which is then shipped to Canada.
The tug-of-war between lower crop yields
and higher prices
is straining many relationships in the supply chain.
Fleming, who deals in specialty coffee from micro-farms, saw demand for specialized beans fade as prices went up.
“Any time there’s a price shock through the market that we saw,
it’s (been) bad for everybody,”
he said.
For example, if a pound of coffee went up from five dollars to eight dollars,
a roastery may be hesitant to pass such a significant cost on to its customers immediately.
Instead, it might reduce its overall purchase
or pivot away from pricier options,
which trickles back to the farmer.
Meanwhile, Fleming said demand for less expensive coffee blends has gone up.
He said he is constantly communicating with farmers about the demand and
whether there are margins that can be adjusted on his end
to continue importing the best-quality beans.
“It’s caused us to have to pivot
and re-evaluate
and get a bit more creative than we used to,”
he said.
When someone questions Pesce about coffee prices,
he pulls up commodities exchange data on his phone
and shows where prices are at
— and how little control he has over the fluctuations.
It takes about 13 to 18 weeks for coffee beans to get from a farm to grocery store shelves.
The price of that packaged coffee was set weeks ago
on the publicly traded commodity market for coffee futures,
which is a way of measuring prices based on contracts for future delivery.
Other resources are also traded this way, including
oil,
gold
and wheat.
Futures trading means a surge in coffee prices today
won’t be felt by consumers for at least another three months.
The market has been volatile amid
ongoing geopolitical tensions,
changing government policies in coffee-producing countries
and tariffs
that make the commodity market more uncertain,
Salter said.
“The market, especially when you’re trading on a commodity, doesn’t like that unpredictability,” Salter said.
So, the high prices compensate for that uncertainty,
he added.
As prices went up drastically over the last two years,
it became harder to manage.
“Exporters,
importers,
roasters,
retailers
-- everybody’s shrinking their margin
because there’s just so much price pressure on everything,”
Pesce said.
“The industry as a whole has gotten less profitable.”
Add to that
shipping costs,
roasting
and packaging costs,
all of which factor into the cost of coffee served to consumers.
The cost of getting green beans into Canada alone makes up more than 70 per cent of the production costs, according to KPMG.
Pesce said he has been absorbing some costs while passing the rest on to his private label clients.
So far, he has raised prices by more than 30 per cent in the past year.
But that often opens a floodgate of questions about why it’s happening.
Reunion started sending out reports or newsletters to its clients explaining
price surges,
hoping to establish transparency about
what can
and cannot be controlled.
Many relationships in the coffee supply chain are generations old, Salter said.
“You’ve set up your roasting equipment,
you’ve set up your production processes in a certain way
that it’s very difficult to switch over from one to another,”
he said.
“So, what you tend to do is to try to improve the situation you’re in,
rather than change the situation you’re in.”
A pound of coffee can brew about 40 cups.
If the cost of coffee goes up by a dollar, it barely adds a few cents to a cup.
But the surge in prices has been consistent enough that it’s now dripped into the cups
at local cafés
and even big chains, such as Tim Hortons,
which raised prices by an average of three cents per cup earlier this year.
Still, most consumers notice sticker shock when they buy bulk coffee at a grocery store or their local roastery, and experts say this is likely to continue.
“There’s very little actual price gouging going on that I can see at grocery, at cafés,” Pesce said.
“It’s just expensive.”
This report by The Canadian Press was first published Dec. 29, 2025.
Ritika Dubey, The Canadian Press
https://www.bnnbloomberg.ca/business/2025/12/29/why-your-cup-of-coffee-costs-so-much-more-now/
My opinion: This part stood out to me the most. I will put this in my inspirational quotes:
“You’ve set up your roasting equipment,
you’ve set up your production processes in a certain way
that it’s very difficult to switch over from one to another,”
he said.
“So, what you tend to do is to try to improve the situation you’re in,
rather than change the situation you’re in.”
Jan. 13, 2026 "McDonald's Canada to freeze price of small coffee, drop cost of value meals for one year": Today I found this article on CBC:
When Annemarie Swijtink took the helm of McDonald's Canada in September, fast-food companies were facing a lot of heat.
Reduced cattle herds had pushed up the price of ground beef,
while climate change
and crop disease
challenged another restaurant staple: coffee.
Caught in the middle were consumers fretting about
tariff tensions
and watching their fast-food favourites inch higher than their desired price range.
Swijtink is now trying to deliver some relief.
She announced Tuesday that McDonald's Canada will
freeze the price of a small cup of coffee at $1 for at least a year
and drop the price of its McValue meals to $5 for the same duration.
The prices are "effective today," according to a press release.
The meals have cost about $6 since they were introduced in 2024.
They include either a
Junior Chicken,
McDouble
or chicken snack wrap
bundled with small fries and a fountain drink.
A new McValue breakfast segment includes a
sausage McMuffin,
breakfast burrito,
bagel with cream cheese
or a sausage McGriddle
paired with a small coffee and a hash brown.
Swijtink said the reason for the price freeze is simple: it's what customers are looking for.
"Canadians are facing challenges
and are insecure financially.
What we are doing is listening
and giving them what they want,"
she said.
Public perception of fast food has shifted
The chain's global CEO, Christopher Kempczinski, said last fall that McDonald's was expecting fewer sales from lower-income diners in the U.S. in 2026,
due to a bifurcated "K-shaped economy" that sees
higher-income consumers spending more
while cash-strapped consumers spend less.
But the move by its Canadian arm doesn't necessarily mean that McDonald's is seeing fewer customers in its restaurants,
said Robert Carter, a restaurant industry analyst with Straton Hunter Group in Toronto.
"This is more about a protecting the visit frequency of customers.
You know, when you get a customer in a weekly routine,
it's very important for quick service restaurants to be top of mind for that routine,"
Carter said.
"We have one of the highest daily uses of restaurants in the global restaurant world.
So the challenge, again, is really around that value equation
— making sure that consumers are feeling good about
where they're spending their money
when they do spend it,"
he said.
McDonald's Canada was able to impose the price changes
because some of its relationships with farmers and suppliers span more than 50 years
and its 1,500 restaurants mean it can find savings from its high volumes,
according to Swijtink.
Her promise comes as the public perception around fast food has shifted in recent years. More people than ever are doing double takes every time they swipe their credit card — and when it comes to dining out, they're willing to go wherever will give them the best value.
This shift has not left McDonald's unscathed. Customers now routinely lament the price of star menu items like the Big Mac or limited time offers like the recent Grinch-themed meals.
"If you're that consumer, you're driving up to the restaurant and you're seeing combo meals could be priced over $10
and that absolutely is shaping value perceptions ... in a negative way,"
Kempczinski said on an August earnings call.
"We've got to get that fixed."
Swijtink appears to agree. The Dutch executive, who got her start at McDonald's in high school and was previously managing director of its Netherlands operations, visited Canadian restaurants in her first few months on the job.
She learned Canadians are far bigger coffee lovers than the Dutch,
who she said have more of an affinity for cheese.
But most importantly, she realized value is at the heart of what consumers here want.
That's why she named it her top priority for 2026,
followed by innovation.
The playbook seems to be similar across the industry.
In recent months, Tim Hortons and Wendy's have both sold meal deals in Canada
and Burger King has also marketed small combos akin to McDonald's McValue menu in the country.
Swijtink maintains rival offerings aren't a bad thing.
"The market is really competitive and from a customer perspective, that's really good because that is always ... elevating the bar for us," she said.
With files from CBC News
https://www.cbc.ca/news/business/mcdonalds-canada-price-freeze-coffee-value-meals-9.7043393
