Global coffee prices are hitting record highs on commodity exchanges, and retail prices are rising in tandem. In Poland, coffee in stores costs over 14% more than a year ago. And this is just the beginning—the transmission of higher global prices to supermarket shelves can take up to 12 months. Against this backdrop, the autumn symbol, Pumpkin Spice Latte (PSL), has also become more expensive in Polish coffee shops. Today, the seasonal latte can cost more in Warsaw than in New York.
Coffee Prices Near Record Levels
Last Tuesday, arabica coffee futures in New York rose to $4.24 per pound, nearing the all-time record of $4.2995 set in February this year. From early August to that peak, prices climbed about 50%. Within a week, they retreated to $3.68 per pound, down 13%.
Several factors are driving volatility: the U.S. imposed a 50% tariff on Brazilian coffee at the end of July, while drought conditions in Brazil continue to threaten output. Although the rainy season is beginning, forecasts suggest insufficient precipitation to restore soil moisture in key growing regions. Financial investors have further fueled price swings, aggressively buying contracts for Brazilian coffee amid limited supply—pushing prices above $4 per pound. Analysts compare this speculative activity to recent patterns in the cocoa market.
Retail Prices Catching Up
Retail prices of roasted coffee are also climbing, though they still reflect earlier rather than current market increases. According to Poland’s Central Statistical Office (GUS), roasted coffee prices in September were 14.1% higher year-on-year. In the U.S., August retail coffee prices were up 20.9%. Globally, coffee remains one of the drivers of stubbornly high inflation. Since price changes filter through with a lag of roughly a year, households and businesses should prepare for higher coffee costs in shops and cafés over the next 12 months.
PSL Returns—at a Higher Price in Poland
This year’s coffee price surge coincides with the return of Starbucks’ most famous seasonal drink: Pumpkin Spice Latte. Despite Poland’s lingering summer weather, autumn is approaching, and PSL has become the season’s cultural symbol. Starbucks reintroduced the drink on August 26, joined by rivals like Green Coffee Nero and Costa Coffee.
In Poland, a grande PSL now costs about PLN 26, up one zloty from last year. In the U.S., despite rising bean costs, PSL prices remain between $5.75 and $7.25. Given the currently weak dollar, this means PSL is often more expensive in Poland than in the U.S.
Starbucks’ Seasonal Powerhouse
Since its debut in 2003, PSL has become more than just a beverage—it is a cultural phenomenon and a profit engine for Starbucks. In 2024, it remained the company’s best-selling seasonal drink, setting sales records.
Starbucks operates around 40,000 stores across 80 countries, including more than 80 locations in Poland, and is gradually expanding into smaller cities such as Nowy Sącz and Kalisz. Yet despite its global leadership, the company faces serious operational challenges in its home U.S. market. Falling sales and an 11% share price drop over the past year reflect weakening performance, while analysts expect further declines in coming quarters. Rising operating costs—from raw materials to employee investments—are squeezing margins. Maintaining a premium strategy during an economic slowdown could prove difficult, as consumers increasingly opt for cheaper alternatives.
Long-Term Outlook Still Solid
Nonetheless, Starbucks remains a company with strong fundamentals and long-term growth potential. Global brand recognition, a loyal customer base, and consistent dividend policy differentiate it from many competitors. Its new “Green Apron Service” initiative, aimed at improving service efficiency and customer experience, offers a path to reversing U.S. sales declines. International markets—especially China—continue to deliver above-average results.
If Starbucks succeeds in implementing its “Back to Starbucks” strategy, combining cost control with service improvements, it could maintain its leadership and return to steady growth. In the long run, this would strengthen the company’s investment appeal.
Source: CEO.com.pl
