South Africans have not given up their coffee habit. They may, however, be becoming more selective about how much they spend to maintain it.

That creates an interesting contradiction for the beverage industry. While annual food and non-alcoholic beverage inflation stood at just 1.1% in August 2026, instant coffee prices were still rising by 5.6% year on year. Since mid-2022, the price of instant coffee has climbed by 57%, while cappuccino sachets have increased by 24.4%, according to consumer research from Eighty20.

These are not the numbers of a product quietly returning to affordability.

They point to a category that remains deeply embedded in daily life but is becoming harder for consumers to buy without thinking about the cost. For South African beverage businesses, the challenge is no longer simply how to sell more coffee. It is how to protect demand when one of the country’s most familiar daily purchases continues to absorb more of the household budget.

The encouraging news is that global supply could begin to change the picture. The US Department of Agriculture forecasts global coffee production to rise by 6% to a record 189.7 million bags in the 2026/27 season. If that increase materialises, the additional supply could ease pressure on international markets and eventually filter through to South African shelves in 2027.

But there is a significant difference between a better harvest forecast and cheaper coffee at the till.

For consumers, that distinction could determine whether the morning cup remains an unquestioned routine or becomes another expense to manage.

The daily cup is proving remarkably resilient

Coffee occupies a distinctive position in South African consumption. It is both a mass-market staple and an increasingly sophisticated lifestyle product.

At one end are households buying instant coffee or chicory-based blends for everyday use. At the other are consumers paying for speciality beans, espresso machines, takeaway cappuccinos and carefully prepared flat whites.

Between these extremes lies a market with very different sensitivities to price.

Eighty20’s analysis of South African consumer behaviour suggests that coffee consumption has held up despite higher prices, although the data indicates that tea has gained ground. Its figures suggest approximately 22 million South Africans drank some form of coffee on the day measured, compared with around 26 million who drank tea. These figures cover people who consumed the beverages, not the number of cups consumed.

That distinction matters. A person who drinks one cup of instant coffee a day and a customer who buys several speciality coffees are counted as coffee drinkers, but their spending patterns are very different.

The market may therefore be more resilient than headline price increases suggest, while still experiencing meaningful changes in what people buy, where they buy it and how often they indulge.

Consumers do not necessarily abandon a familiar beverage when prices rise. They may switch brands, choose smaller packs, reduce the number of takeaway purchases or reserve premium coffee for weekends.

For manufacturers and retailers, these quieter adjustments can be just as important as an outright decline in consumption.

The pressure starts far beyond the supermarket shelf

South Africa imports most of the coffee it consumes, leaving local prices exposed to international commodity movements, exchange-rate changes, shipping costs and the economics of roasting and distribution.

The global coffee market has been particularly volatile in recent years, with production disruptions and weather-related concerns affecting expectations for supply. A weaker rand can also make imported coffee more expensive, even when international prices move in the right direction.

And the final retail price reflects considerably more than the green coffee bean.

Roasting, packaging, transport, electricity, labour, distribution margins and retail costs all influence what consumers eventually pay. Businesses may also have purchased inventory at earlier, higher prices or entered into supply agreements that delay the benefit of lower commodity prices.

This is why a record harvest would not necessarily trigger an immediate reduction in South African coffee prices.

Even if international supply improves, the benefit could take months to reach consumers. The size of any reduction would depend on how far commodity prices fall, how the rand performs and whether other operating costs remain elevated.

There is also a weather-related complication. Forecasts of stronger production are not guarantees: coffee yields remain vulnerable to adverse conditions in major growing regions. The prospect of an El Niño weather pattern has renewed concerns about agricultural supply and the prices of several commodities, including coffee. For businesses planning their 2027 purchasing, the sensible approach is to prepare for potential relief without assuming it is already secured.

The battle for value is happening in two different markets

The affordability challenge creates an unusual situation for the coffee industry. A product can become more expensive in supermarkets while speciality coffee shops continue attracting customers who are willing to pay a premium for convenience, quality or experience.

The two markets overlap, but they are not interchangeable.

For households under pressure, instant coffee offers a relatively inexpensive way to preserve a daily ritual. A takeaway cappuccino, meanwhile, competes with other discretionary purchases and must justify its price through more than caffeine alone.

That gives brands an incentive to become more precise about the customers they serve.

Mass-market producers need to defend affordability and availability. Premium roasters and coffee shops need to communicate quality, consistency and the experience behind the price. Trying to compete across both markets without a clear proposition risks leaving a brand squeezed between cheaper alternatives and more distinctive premium offerings.

There is an opportunity here for local roasters, too. South Africa may not have the tropical growing conditions required for large-scale commercial coffee production, but it has an established base of roasting expertise, independent cafés and consumers interested in origin, flavour and preparation.

Local businesses can differentiate themselves through freshness, blends, brewing education and stronger relationships with customers, rather than competing solely on the international price of the bean.

For smaller operators, the challenge is to build loyalty without allowing higher input costs to erode margins. A business that absorbs every increase may retain customers temporarily but weaken its ability to invest. One that passes on every increase may find customers reducing their visits.

The winning approach will depend on understanding where customers see genuine value.

A record harvest could reset expectations

The USDA’s projected 189.7 million bags of global production in 2026/27 would represent a meaningful increase in supply if achieved. Eighty20’s analysis suggests that a surplus could create room for South African shelf prices to ease next year.

For consumers, that would be welcome news after several years of rising prices. For businesses, however, cheaper raw materials could create a new competitive challenge.

If costs fall, customers may expect retail prices to follow. Brands and retailers that have raised prices to protect margins could face pressure to demonstrate that savings are being passed on, particularly if competitors move first.

The timing will be critical. Businesses that bought expensive inventory may not have immediate room to reduce prices, while those with more flexible sourcing arrangements could respond sooner.

The most effective operators will watch the entire supply chain rather than treating international coffee prices as a direct predictor of retail prices. They will also pay attention to customer behaviour: whether shoppers are trading down, whether speciality purchases are becoming less frequent and whether value-oriented offerings are gaining share.

There is a risk in assuming that a better harvest automatically restores the market to where it was before prices surged. Consumers who have changed their habits may not switch back immediately, and businesses that have built their propositions around affordability or premium experiences may find that their customers’ expectations have changed.

The next phase of the coffee market will be shaped as much by these decisions as by the size of the harvest.

For South Africa’s coffee industry, the question is no longer simply whether the world can produce enough beans.

It is whether a better supply outlook can make coffee more affordable without making the business of selling it any less sustainable.