Coffee Consumption at 21-Year Low : Commodities: Trade group attributes the slump to high prices but predicts a rebound as wholesale costs ease.
NEW YORK — Espresso bars and coffeehouses seem to be cropping up on every corner, but a recent study shows U.S. coffee consumption has fallen to its lowest level in a generation.
Americans drank an average of 1.7 cups per day last winter, compared to 1.9 cups two years ago, the National Coffee Assn. found in a recent study. Coffee drinking is normally at its highest during the winter.
The latest consumption figures are the lowest since the studies began in 1974, the association said. The United States is the world’s largest coffee consumer, and almost half the population, 47%, drinks coffee, the group said.
The association attributed the downturn to a sharp rise in retail prices during the second half of 1994 after two devastating frosts in Brazil.
The frosts wreaked havoc on the world’s biggest coffee crop and drove retail prices up by more than 40% at their peak.
Most industry analysts agree that the retail price surge prompted consumers to scale back their coffee drinking. While the study tracked consumption only through last winter, analysts said unusually warm weather this summer put a further dent in sales.
“I bet there was a heck of a lot of soda consumption and iced tea, but coffee consumption was way down,†said Jim Cordier, analyst with Allendale Commodities.
Cordier said consumption levels will eventually rebound to pre-frost levels as retailers lower their prices to reflect a decline in the futures market.
“People . . . get used to drinking a little bit less,†he said. “It [will] take a year to get that demand back.â€
Some market watchers contend the decline has been more deep-seated, reflecting a larger trend away from coffee and toward sweeter beverages.
It may be difficult, they say, to recapture all of the coffee enthusiasts who strayed to other beverages, such as carbonated soft drinks, during the price hike.
“The pattern is for a gradual, albeit modest, reduction in consumption,†said William O’Neill, who follows commodity markets for Merrill Lynch.
As for the booming coffee bar industry, the higher price for specialty coffees could also be a factor in depressing overall consumption, analysts said.
Java enthusiasts who normally don’t hesitate at a refill might think twice before paying for a second iced mocha cappuccino.
“Due to the price that some of these cups of coffee cost, it may result in people drinking one cup of coffee instead of two,†O’Neill said.
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