Matteo Borea, strategic consultant and innovator in the coffee sector, co-owner of the historic La Genovese coffee roasting company in Albenga (Savona) and author of the blog matteoborea.it, a reference point for evolved coffee entrepreneurs, provides an in-depth and interesting analysis about how coffee industry entered the luxury market. Below, we share his opinions.
The coffee industry in the luxury market
by Matteo Borea
Borea: “Coffee has always been positioned as a commodity, an essential, everyday product purchased primarily on the basis of price. But if you hadn’t realized it yet, those days are over. The coffee industry has long since entered the luxury market, and whether you know it or not, your business is already operating within it. The question is: are you ready to thrive in this new reality?
The irreversible change in coffee prices
Green coffee prices have skyrocketed and will not return to past levels. For too long we have literally been exploiting producers, and now “the balance must rebalance”.
● Arabica has crossed the $8 per kg mark.
● Robusta is just under $6 per kg.
Many people in the industry do not even know this, and others continue to regard it as a temporary market fluctuation, citing the excuse that “the world of coffee is complex.”
But deep down, the truth is that it is a simple economic principle that many tend to overlook, often because recognizing it would require a rethinking of the entire business model. These are not just industry-specific factors, but basic supply and demand dynamics.
The factors I mentioned – climate change, the impending enactment of the EUDR, geopolitical instability, and the global commodity race – all point to one clear reality:
Supply is shrinking. Farmers are grappling with unpredictable weather conditions, regulations on deforestation and traceability are increasingly stringent, and logistical disruptions continue to impact global trade.
At the same time, something equally significant is happening on the demand side.
Consumption is increasing even in countries that historically had little coffee culture. One of the most striking examples is China, where coffee is rapidly gaining ground, especially among younger generations and urban professionals. More times I talked about this topic in my blog.
[If you are interested in the implications of this topic, HERE you will find an in-depth article on China’s growing coffee market: “The real reason why the price of green coffee will rise that no one is talking about”]
When these two forces, a strong declining supply and a strong rising global demand, collide, the result is not complicated. It is simple market logic.
Prices skyrocket. This is not just speculation. It is an economic reality that every coffee entrepreneur must recognize. From the Barista to the Coffee Roaster. Because to ignore it is not just to misunderstand the market: it is to put your business at risk by resisting the change that is already happening.
Coffee is no longer a commodity: it is a luxury product
Think about it. What defines a luxury market? No. Not just price, as you’re probably thinking, but perception, experience, and differentiation.
Luxury markets thrive on a combination of exclusivity, quality, storytelling and brand identity. And it is precisely in this direction that coffee needs to go.
If you need an example, not to always mention the wine world, just look at what has happened in the chocolate industry in the last two decades.
There was a time when chocolate was just another mass-produced product, sold on supermarket shelves, often without clear differentiation beyond price.
Then, some brands changed the game completely:
● They highlighted the origins of their cocoa beans.
● They told the stories of their producers and craftsmanship.
● They have refined packaging and brand positioning, making price a secondary factor.
Today, the quality chocolate segment is thriving. Customers are buying not just chocolate, but a story, an experience, a brand philosophy.
The same transformation is happening in coffee. Only many have not yet realized it. In fact, many are fighting it, thinking that resisting it is what brings them advantage when the advantage lies in having the opposite thought.
Why the biggest risk is maintaining the “commodity mindset”
It is not rising costs that pose the greatest danger to coffee companies. It is the inability to adapt.
If you continue to treat coffee as a volume-based commodity and compete only on price rather than value, your business is at risk.
Meanwhile, forward-thinking coffee entrepreneurs are redefining their offerings, targeting more discerning audiences and creating stronger brand identities.
And here is the truth: they will succeed while others will struggle.
How to compete in the new era of luxury in the coffee industry? The solution is not just to increase prices, but to increase the perceived value of what you offer.
This requires three fundamental strategic changes:
1. Repositioning your brand → Are you still marketing your coffee as a generic product? Or are you shaping stories that resonate with high-value customers?
2. Refine your target audience → Who are you targeting? The mass market or coffee drinkers who really appreciate quality, experience, and exclusivity?
3. Create a compelling narrative → What makes your offering unique? What is your story? What experience do you offer beyond the product itself?
This is not speculation. It is something I have seen firsthand.
Working with coffee entrepreneurs in more than 30 countries for more than 20 years, I have seen companies that have managed to change and grow by embracing this change. And I’ve also seen others stand still, clinging to old strategies, hoping that the market will return to what it once was. It hasn’t. And it won’t.
What does your business need to grow today?
That is the question to ask. And I think the right answer is not to throw ourselves into the downward price war. If you choose this strategy in our bars there will only big chains. And the same goes for companies in the industry. Without a change of mindset, spirit of adaptation and a broader vision, multinationals will shop at the discount store.
Matteo Borea: “This is the right time to ask the right questions. It is the time to take full responsibility, to see challenges as opportunities, to look at problems from a different perspective, to strive to be the best version of yourself, to create flexible processes and structures, and to train your spirit of adaptation.” “Asking the right questions is the first step to finding the right answers.”
Matteo Borea
