How much is too much for a cup of coffee?

The days of scoring a coffee for $4 are long behind us, yet Australians’ demand for high-quality beans and well-made brews remains. As the cost of coffee beans surge and cafes push prices towards $7 a cup, the industry is being forced to examine how to keep customers coming back – and how much they can charge before customers walk away.

According to La Marzocco Australia’s Future of Coffee Report 2025, there is a shifting trend for cafes to position coffee as a luxury item rather than a necessity. “Coffee is a handcrafted, hand-grown product processed like a crafted drink. Why should it be a third of the price of an average pint of beer?” asks La Marzocco Australia Sales Manager Brydon Price.

Golden Brown Coffee Co-Founder Sonam Sherpa adds that people need to stop seeing coffee as a basic need. “It’s a luxury and they need to treat it like that”.

But for daily coffee drinker Georgina LoPilato, justifying the rising cost is challenging. LoPilato buys coffee daily during the week, scoring discounted ‘mates rates’ cups at a café near her work. “But if I buy coffee at the café near my house it’s about $6 or $6.50 and that feels a bit too much,” says LoPilato. “Because coffee used to be $3.50, seeing the gradual increase in price is difficult. I just feel like morning beverages shouldn’t be that much.”

The report presents expected trends for the year ahead, a timely launch with the cost of coffee beans recently hitting its highest number in 50 years, which is attributed to droughts in coffee growing regions.

Predictions include an increase in the number of cafes staying open and serving coffee later; a larger desire for low-caffeine options; and a projected increase in the cost of coffee to $7 a cup by the end of 2025.

Research from IBISWorld shows that a cup of coffee in Australia cost $4 on average pre-pandemic. It’s now sitting at $5.50. At the same time, customer expenditures and frequency of café visits have declined due to the cost-of-living crisis.

“The cost of coffee is doubling, and cafes will have to put prices up 50c to $1 over time,” says Market Lane Founder Fleur Studd. “By the end of the year, it won’t be unusual to see $7 or $7.50. As roasters, we are trying to support cafes to have those conversations with customers and give context to higher prices.”

For LoPilato, the coffee would have to be exceptional to justify the price. “If I’m paying $7, I may as well buy a juice,” she says. But there is an exception. When buying from friends businesses or from independent cafes with ethically sourced beans, she feels better about paying more.

Specialty coffee roaster Single O has already increased the cost of a regular coffee to $6.50 and a large to $7.50. The move has been driven by the increase in global coffee prices, alongside the premium costs aligned with ethically sourced specialty beans.

“For over 20 years, the price of specialty coffee in Australia has been kept artificially low, often comparable to mass-market chains,” says CEO Mike Brabant. “But the meticulous work that goes into every cup – from the producer’s farm to the roaster’s craft to the final pour at an independent cafe – deserves to be fairly valued.”

Managing Director of La Marzocco Australia Barry Moore says serving a good cup of coffee is no longer enough. “Customers are increasingly willing to pay a premium for high-quality, ethically sourced coffee, and that means businesses must step up their game in sourcing, brewing, and service quality. Whether it’s a small neighbourhood café or a high-end hotel, coffee can significantly enhance the customer experience and drive repeat business.”