published: 2026-08-30 12:00

Łukasz Rawa

EU regulations may push up coffee prices. The most extreme scenario envisages a rise of over 300 per cent, although this is considered rather unlikely by the industry. Nevertheless, this does not mean that espresso lovers can rest easy: droughts, El Niño and other weather anomalies in Brazil and Vietnam could seriously destabilise the market.

The prospect of coffee prices rising by more than 300 per cent has emerged in the debate over the so-called ‘mirror clauses’ (which stipulate that food imported from outside the EU must be produced in accordance with the same standards as those applicable to EU producers). The European Commission is analysing the possibility of tightening the rules on food imported into the EU. This includes, among other things, pesticide residues that are prohibited by EU regulations.

Such a scenario would hit the coffee market particularly hard, given that Europe is almost entirely dependent on imports.

‘A 300 per cent rise in the price of coffee is not a forecast by the European Commission. It is the result of an extreme model scenario assuming that producers fail to adapt and that some imports are effectively cut off,’ says Sylwia Mokrysz, PhD, president of the Coffee and Tea Market Research Institute, proxy and member of the management board of Mokate.

It is not just about regulations:

‘The greatest threats to the coffee market are the combination of high coffee bean prices, unfavourable exchange rates and new regulatory costs,’ says Sylwia Mokrysz, PhD, president of the Coffee and Tea Market Research Institute, proxy and member of the management board of Mokate.

Photo: Krzysztof Szczotko

332 per cent in the most extreme scenario

In the most restrictive scenario of the analysis by the European Commission’s Joint Research Centre (JRC), prices would rise by 332 per cent. However, the analysis assumed that producers outside the EU would have very limited capacity to adapt to the new standards, resulting in a sharp drop in the amount of coffee available to European consumers.

Sylwia Mokrysz emphasises that this result should primarily be viewed as testing the market’s resilience to an exceptionally severe supply shock rather than as a forecast of what we will see on shop shelves. In practice, producers can change the plant protection products they use and their farming methods. This comes at a cost, but it does not necessarily mean that their coffee will disappear from Europe.

In less extreme scenarios analysed by the JRC, the impact of the new requirements on prices is incomparably smaller. The greater the producers’ ability to adapt to the new rules, the lower the risk of a supply shortage.

‘One should not equate increased costs on the plantation directly with the price of a packet of coffee,’ says Sylwia Mokrysz.

This is because the retail price also includes transport, roasting and processing, packaging, energy, labour and distribution costs. Therefore, assuming that the major producers adapt, the Coffee and Tea Market Research Institute expects the new EU requirements to have a rather limited impact on retail prices rather than price rises running into tens or hundreds of per cent.

Importantly, this is currently just a potential regulation. The European Commission is analysing the possibility of changing the permissible pesticide limits, but no decision has yet been made.

Europe needs Brazil and Vietnam

The problem is that Europe depends on just a few main sources of coffee beans. In 2025, the EU imported around 2.9 million tonnes of coffee. More than half came from Brazil and Vietnam. These countries, together with Uganda, Colombia, Honduras, Ethiopia, India and Indonesia, accounted for around 85 per cent of imports.

‘The greatest risk for the EU is the concentration of supplies. If either Brazil or Vietnam were to experience difficulties adapting, the consequences would be felt throughout the entire European market,’ says Prof. Łukasz Wróblewski, PhD, Director of International Cooperation at the Institute for Coffee and Tea Market Research and an academic at the University of Economics in Katowice.

The scale of regulatory differences is significant. A PAN Europe analysis covering Brazil, Colombia and Kenya shows that of at least 159 active substances used or registered in coffee production, 59 per cent are banned in the EU. However, this does not mean that the same proportion of supplies is at risk. It all depends on which substances will be covered by the new regulations, how widely they are used and how quickly producers can find alternatives.

Adaptation will come at a cost

While a change in the plant protection products used on plantations may not lead to a fall in production, it could increase production costs. For example, the JRC estimates that replacing cyproconazole – a fungicide not authorised for use in the EU, partly due to its potentially harmful effects on fertility and foetal development – with alternatives could increase production costs by 20–40 per cent.

‘For large growers, the additional costs will primarily be just another part of running an export business. However, for small growers, changes to plant protection products, additional checks and documentation may pose a much greater barrier,’ says Sylwia Mokrysz.

She therefore believes that cost increases and production adaptations are more likely than a significant reduction in output. Nevertheless, some smaller growers may find the European requirements too costly and redirect their produce to other markets.

Coffee can be replaced, but not every type

Importers may seek new suppliers, but changing sourcing destinations is not always easy. What matters is not only the availability of the raw material, but also the coffee variety, the quality of the beans, the sensory profile, the price and the recipes for specific blends.

‘The market would probably be able to compensate for the loss of individual smaller suppliers. A far more serious problem would arise if the restrictions were to affect a large proportion of the supply,’ says Łukasz Wróblewski.

In such a scenario, importers would begin competing for raw materials, and this would quickly be reflected in prices. While experts do not expect a sudden shortage of coffee in Europe, a significant drop in supply would lead to rising prices, new sourcing routes and, to some extent, changes to the composition of blends.

Weather more important than Brussels

For the time being, however, the main source of risk in the coffee market is not regulations, but the situation on the global market.

‘The most important direct factor at present is the price of green coffee beans, which is primarily shaped by the relationship between supply and demand, as well as conditions in the largest producing countries,’ says Sylwia Mokrysz.

Brazil accounts for almost 40 per cent of global production. The US Department of Agriculture (USDA) is forecasting a record 71.9 million bags of coffee for the 2026/27 season there, which has improved the supply outlook. However, these forecasts may be revised due to weather anomalies.

In July 2026, global coffee prices were 10 per cent higher than a year earlier and as much as 85 per cent higher than three years earlier. Uncertainty surrounding El Niño and its potential impact on Brazilian crops is increasing price volatility.

For Polish producers, the dollar exchange rate as well as the costs of transport, energy, packaging, labour and roasting are also significant factors.

The EUDR is already knocking at the door

The discussion on pesticides currently centres on potential changes. However, the industry is facing a regulation whose impact is far more tangible – the EU Deforestation Regulation (EUDR).

From 30 December 2026, large and medium-sized operators will have to demonstrate that coffee placed on the EU market does not originate from deforested areas and meets the requirements of the regulation.

‘The EUDR currently poses a more tangible operational challenge for the coffee industry than the debate over new pesticide limits,’ says Sylwia Mokrysz.

The cost will not take the form of a single fee. Rather, companies must invest in the traceability of coffee beans, data collection and verification, the geolocation of plantations, IT systems and cooperation with suppliers.

Sylwia Mokrysz highlights Rwanda as an example, where a digital system has been created to track transactions between growers, processors and exporters. This system is linked to geospatial data that identifies the place of production. Half of Rwanda’s coffee exports, by volume, go to the EU.

It is currently impossible to say whether the EUDR will affect prices more significantly than any potential new pesticide regulations. However, the former represents a relatively fixed cost for the supply chain. The latter would pose a far greater threat if it resulted in fewer suppliers being available.

Poles will not switch to acorns

The debate over coffee prices has also made its way into the political arena, with Agriculture Minister Stefan Krajewski reminding people of coffee made from acorns. However, the industry does not expect people to start searching for substitutes on a large scale.

‘Acorn coffee is more of a colourful metaphor than a realistic market scenario,’ says Sylwia Mokrysz.

In her opinion, previous price rises have shown that consumers are more likely to change how they buy coffee than to give it up altogether. Mintel research shows that 56 per cent of British coffee consumers say that further price rises would prompt them to choose cheaper varieties or brands. Consequently, the response could be own-brand products, cheaper blends, instant coffee, a higher proportion of Robusta beans or less frequent visits to cafés.

Similar trends are already evident in Poland.

‘Consumers are more price-sensitive than they were a few years ago, which is reflected in their search for special offers and more conscious planning of their purchases. Despite price pressures, however, we are not seeing a shift away from the category, but rather a change in purchasing behaviour,’ says Tomasz Fajfer, managing director of Tchibo Warsaw.

Meanwhile, sales of whole bean coffee are rising, driven by the growing number of automatic coffee machines in homes, as are sales of coffee capsules. The market is becoming polarised. Some customers are looking to save money, while others are willing to pay more for high quality and specific flavours.

Stabilisation becoming more likely

Over the next two or three years, the stabilisation of prices is more likely than another wave of sharp price rises.

This is the scenario anticipated by Prof. Magdalena Sobocińska, PhD, of the Wroclaw University of Economics. Global coffee prices have already fallen from their peaks, and with a good supply, there may even be periodic falls in the price of the raw materials, which should also become apparent in the retail sector with a delay.

However, this does not mean a return to previous prices. According to the Polish Central Statistical Office (GUS), coffee and its substitutes cost 6.6 per cent more in Poland in June 2026 than a year earlier.

‘We should rather expect price stabilisation with possible periodic falls, but at a higher level than before the last commodity crisis,’ says Magdalena Sobocińska.

Regulations combine to drive up costs

Even an improvement in the situation on the global commodities market does not necessarily mean the end of cost pressures. The potential new rules on pesticides and the EUDR are exacerbated by additional EU regulations.

‘The coffee industry is facing a growing regulatory burden. It is not so much the cost of a single regulation that matters, but rather the possibility of a cumulative effect arising from obligations from various areas of EU law,” says Karolina Miara, a lawyer and Director of Cooperation with Public Institutions at the Coffee and Tea Market Research Institute.

One such regulation is the Packaging and Packaging Waste Regulation (PPWR), which comes into force on 12 August 2026. Companies must adapt, among other things, their packaging and the processes involved in managing it. From 27 September, provisions strengthening consumer protection against misleading environmental claims will also come into force. Added to this are the costs associated with the EUDR, including IT systems, data collection and verification, audits and supply chain documentation.

However, not all of these costs will necessarily be passed on to the shop shelf. As Karolina Miara emphasises, this depends on various factors, including market structure, the bargaining power of individual companies and the potential for improving efficiency. Nevertheless, the accumulation of new obligations increases cost pressures across the entire supply chain, and some of these expenses may ultimately be reflected in the price of coffee.

The Expert’s View

300 per cent is an extreme scenario

Mariusz Dziwulski, PhD

an agri-food sector analyst at PKO BP bank

A rise in coffee prices of over 300 per cent is one of the extreme scenarios. It assumes that foreign suppliers will be completely unable to adapt to the new pesticide residue requirements and that EU imports will fall by as much as 56%. However, it should not be treated as a forecast.

A much more moderate JRC variant assumes that some non-EU producers will adapt, resulting in a decline in imports of only a few per cent. In this case, coffee prices could rise by around 6%, whereas in the most optimistic scenario the increase would not exceed 1%. Furthermore, higher prices in the EU than in non-EU markets would encourage producers to comply with the new standards. The costs of such changes could be lower for them than losing access to the European market.

This is particularly significant because the EU accounts for one-third of global coffee imports. At the same time, unlike with many agricultural products, it cannot compensate for reduced imports by increasing its own production. As a result, coffee prices are highly sensitive to trade and supply disruptions.

For the time being, conditions in the global market are a more significant source of volatility. In recent years, prices have reacted strongly to weather conditions in Brazil and Vietnam. In July 2026, global coffee prices were 10 per cent higher than a year earlier and as much as 85 per cent higher than three years earlier. Rises in raw material prices are passed on to shops with a delay, partly due to contracts and stock levels. By the end of 2025, the annual rate of increase in the price of coffee and its substitutes in Poland was 17%, while in July 2026 it stood at 4.5%.

High prices, however, have their limits. Consumers may cut back on purchases or opt more frequently for instant coffee or cheaper blends. This means that producers and retailers will not always be able to pass on the full cost increase to customers. Some of the pressure may therefore be absorbed by the margins of importers, processors and retailers.

Looking ahead to the next dozen or so months, sharp price rises do not appear to be the most likely scenario. The USDA forecasts a 6% increase in global coffee production and an 8% rise in closing stocks for the 2026/27 season, which will be the highest level in four years. However, El Niño and other weather phenomena remain a risk. In 2027, the introduction of EUDR obligations may also lead to cost pressures.