Insight Flash: Consumer Edge Basketview Data Signals Trade Down in Coffee as Consumers Respond to Commodity-Driven Pricing
While trade tensions and tariff fallout have dominated headlines recently, certain commodity prices were rising well before new tariff rates took effect, pressuring consumer wallets. For example, coffee prices rose 50% over the last year, leading CPG companies to pass along price increases to protect margins. Now, investors and companies are faced with the question of how discerning shoppers will be and whether price elasticity will deviate from historical norms amid a tough economic environment. Since coffee largely functions as a pass-through pricing category and nearly all coffee beans are imported from countries like Brazil and Vietnam, a 10% base tariff will likely cause CPGs to increase pricing to offset tariffs in addition to adjustments to account for commodity inflation.
Within coffee there are four distinct subcategories – ground, instant, single cup, and ready to drink (RTD) with instant the cheapest on a per cup basis followed by ground, single cup, and RTD. As such, instant coffee share gains can be used as a proxy for trade down. Consumer Edge Basketview data shows that in recent weeks, RTD coffee has steadily lost share to other segments with the significantly cheaper per-cup instant coffee a notable share gainer (+1% in the last week ended 6/15). While pricing is up across all 4 subcategories, the year over year increase in ground is ~2.2x that of instant and ~2.4x that of single cup, causing ground volumes to decline mid single digits to double digits in recent weeks vs increases for instant and flattish volumes for single cup. Notably, single cup volume growth deterioration coincided with a significant acceleration in pricing in week 20 (~3 weeks ago).
On June 10th, J.M. Smucker CEO Mark Smucker commented that the company has now taken three price increases over the past 12 months (June 2024, October 2024, and May 2025) with another coming in August. Management noted its May 2025 price increase should be on shelf already and as such Consumer Edge Basketview data can provide insight into the impact of price changes on near-term competitive dynamics. The data reveals that coffee pricing has moved higher in recent weeks with key subcategories of ground, instant, and single cup +31%, +14%, and +13% in the last week ended 6/15, while SJM’s coffee brands specifically have increased price +28%, +30%, and +12%. Given SJM has led on pricing, the company has begun to realize share losses across the three subcategories. Taken together, the observed SJM share losses and subcategory mix shift is further evidence of stretched consumer wallets and in turn potential reduced discretionary outlays in other areas.
The recent surge in coffee prices is more than just a bitter pill for consumers—it’s a wake-up call for CPG brands and investors alike. With instant coffee climbing in popularity as wallets tighten and premium formats lose steam, the Consumer Edge Basketview data offers early indicators of an emerging consumer retreat. As Smucker’s aggressive pricing plays begin to cost them shelf space, the data underscores a broader story: in today’s volatile market, even the most habitual purchases are subject to scrutiny. When it comes to coffee, it seems consumers are opting for practical over premium—proof that in a challenging economic climate, every dollar (and every cup) counts.
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About the Authors
Connor Rattigan is the Senior Analyst – Food & Beverages at Consumer Edge. Follow him on LinkedIn.
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