Your morning cup of coffee could increase in price by as much as 20 per cent in the next six months, according to experts.
The rising price is due to a combination of factors, including a global shortage of the Arabica bean, shipping restrictions caused by Covid-19 and an increase in the cost of containers from South America and Central Asia.
Extreme weather in Brazil, the world’s largest producer of Arabica, is another key factor in the supply crisis after frosts wreaked havoc and wiped out a third of the crop.
A senior figure from one of the UAE’s leading coffee producers said the average cost of the Arabica bean had almost doubled over the past year from $1 a pound (0.45 kilograms) to $1.80, an increase that is going to hit consumers in the pocket.
It is inevitable we are going to see an increase in the next six months
Alan Hardman,
Coffee Planet
“It is inevitable we are going to see an increase from 10 per cent to 20 per cent for the end consumer in the next six months,” said Alan Hardman, sales and marketing director for Dubai company Coffee Planet, which roasts the equivalent of 25 million cups of coffee each month.
“I also think that increase will stick around for the next couple of years at least. There are also concerns the price could go up as high as $4 per pound next year, which will unfortunately be passed on to the consumer.”
The Arabica bean is estimated to be used in 60 per cent of the coffee produced worldwide and is synonymous with speciality coffee — something the UAE market is renowned for.
The global shortage has resulted in some global producers toying with the idea of turning to the alternative Robusta bean, which is significantly cheaper and commonly used in instant coffee, it is also associated with a bitter flavour.
However, Mr Hardman believes the market in the UAE will endure the price increase because of the popularity of coffee made here using the Arabica bean.
“There are a lot of roasteries in Dubai alone that have invested a lot of money into using the Arabica bean to create speciality coffees,” he said.
“That is a scene that is only going to increase and there are huge numbers of speciality coffee shops here as well. There are just rows and rows of coffee shops that are bound to the Arabica style coffee.”
He said the region’s love of coffee is illustrated by the fact his company has taken a record number of orders this month, despite the impact of the pandemic and the recent surge in cost.
“People are not going to stop drinking coffee as it has become a such a normal part of daily life across the globe and especially so in this region,” said Mr Hardman.
The coffee price increase comes as the industry grapples with the effects of the pandemic.
“We saw about 40 per cent of the places we supplied to close down and they have not reopened,” said Matt Toogood, owner of Dubai’s Raw Coffee Company, which supplies coffee to more than 350 companies in the UAE.
“There are a huge amount of places that have just disappeared.”
One of the trends during the pandemic was people investing in home equipment to make their own brew, due to restrictions on travel, which has made them savvier about coffee.
This means coffee shops will have to up their game, especially if prices are going to increase, said Mr Toogood.
“There is a temptation for companies to reduce the standard of their coffee but keep charging premium prices, which is what I am worried will happen in a lot of cases,” he said.
“However, many consumers have spent time working out what makes good coffee and have gone back to the chain stores and are now expecting a better quality. For a long time, companies have tried to hide bad coffee by using loads of sugar to compensate.”
He said the budget end of the market is going to be especially hit by price increases as smaller companies will not be able to absorb the price increases.
“The bottom end of the market is going to be 100 per cent affected because they have no way of avoiding it,” said Mr Toogood.
“Your cup of chai from the guy on the back of his bicycle is going to double because his cost has doubled.”
There is one upside to the expected ramping up of coffee prices, according to Mr Toogood.
“The coffee producers are thankfully going to be making more money,” he said.
“The biggest problem we have had in the coffee industry over the last 10 years is the farmers themselves have not been paid enough.
“In most cases, they have been surviving on the poverty line.”
Sixty per cent of all coffee comes from smallholder coffee farmers with less than five hectares of land, which amounts to about 12.5 million people.
Non-profit group Enveritas, which works to promote sustainable coffee growing, estimates that at least 5.5 million of those people live below the international poverty line of $3.20 a day.
But the increase in price may not matter to coffee-lovers in the region, as long as they have their morning cup every day.
The owner of another Dubai-based coffee franchise believes a large amount of customers know exactly what they want from their favourite beverage and are willing to pay for it.
“A lot of our customers appreciate good coffee and are prepared to pay a little bit more for it,” said Kaniz Samir-Mostaffa, co-founder of Blk Cab Coffee, which charges up to Dh35 per cup from its brew bar.
“The coffee connoisseurs have always been happy to pay that little more for the extra quality.”
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
Kat Wightman's tips on how to create zones in large spaces
- Area carpets or rugs are the easiest way to segregate spaces while also unifying them.
- Lighting can help define areas. Try pendant lighting over dining tables, and side and floor lamps in living areas.
- Keep the colour palette the same in a room, but combine different tones and textures in different zone. A common accent colour dotted throughout the space brings it together.
- Don’t be afraid to use furniture to break up the space. For example, if you have a sofa placed in the middle of the room, a console unit behind it will give good punctuation.
- Use a considered collection of prints and artworks that work together to form a cohesive journey.
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