Good news, coffee drinkers: Prices are finally dropping after seeing sharp increases in 2011. While coffee prices have risen substantially over the last decade, Americans continue to drink more and more cups of Joe.
The United States Bureau of Labor Statistics reported the news to mark National Coffee Day, which is Sunday. According to the bureau, the price of coffee in August 2013 was 10 percent lower than in January 2012. Compared to a decade ago, coffee prices in 2013 were 38 percent higher than they were in August 2003. Coffee prices soared in 2011 before decreasing slightly in 2012 and again in 2013.
Not all coffee is created equal, as the price for roasted coffee has increased more rapidly than freeze-dried or instant coffee. Roasted coffee prices increased by 41 percent over the past decade compared to a 23 percent increase in the price of instant or freeze-dried.
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From 2003 through 2005, coffee prices and tea prices were both stable, but they diverged dramatically from 2005 onward. Tea prices have increased only modestly over the last decade, by 14 percent according to the bureau.
Despite the higher prices, Americans still enjoy drinking java on a daily basis. According to the National Coffee Association's "2013 National Coffee Drinking Trends" report, coffee drinking in 2013 increased from 2012 levels. According to NCA's report, 83 percent of Americans reported coffee consumption within the past day, a 5 percent increase from 2012, while daily, habitual consumption remained steady at 63 percent. Robert F. Nelson, NCA president and CEO, credits the increase in coffee consumption to the popularity of single-cup coffee as well as the increase in coffee consumption among Hispanic Americans. Nelson said in a statement, "Building on existing market enthusiasm, changing U.S. demographics and single-cup brewing may be adding momentum to already enthusiastic consumer engagement."
Interestingly, coffee consumption in younger age demographics, 18-24 and 25-39, decreased but the NCA believes that is more due to volatility than an actual decrease in consumption. Daily coffee consumption the 18-24 demographic decreased from 50 percent in 2012 to 41 percent in 2013 and the 25-39 saw a decrease from 63 percent in 2012 to 59 percent in 2013. Per the NCA, "The 2013 levels are more on par with earlier years, suggesting that the apparent decline indicates volatility in these segments rather than softening."
The best way to celebrate the good coffee news is to actually drink some, and there will be plenty of opportunities to do so during National Coffee Day. Many stores are offering free, or discounted drinks. To see what coffee deals Starbucks, Dunkin' Donuts and many more are offering click here.