"Even a 'Caffeine Fix' Is Getting Pricier...Famed 'Coffee Republic' Korea Sees Biggest Shift in Six Years"

Battered by Exchange Rates and Weather, Korea's "Coffee Republic"

First-Half Coffee Bean Imports Hit Six-Year Low

Import Volume Reaches Only 87,830 Tons from January to June, Down 17.7% Year-on-Year

Arabica Bean Average Price at $3 an

Coffee imports in South Korea, often dubbed the "Coffee Republic," hit a six-year low in the first half of 2026 (January to June). Soaring coffee bean prices combined with persistently high exchange rates have increased sourcing costs, prompting a decline in raw material imports for the coffee industry. With elevated bean prices and exchange rates expected to continue into the second half of the year, concerns over profitability in the sector are growing.

A franchise coffee store in Seoul. Photo by Hyunmin Kim kimhyun81@

According to Customs Service export-import trade statistics released on July 21, coffee imports in the first half of this year totaled 87,830 tons, with an import value reaching 775.63 million US dollars (approximately 1.1515 trillion won). Compared to the same period last year, import volumes dropped 17.7% and import value fell 10.4%. Both the volume and value of coffee imports have declined for the first time in three years.

Notably, coffee import volumes marked their lowest first-half level in six years, having last reached such a low in 2020. Imports climbed from 84,902 tons in the first half of 2020 to 94,843 tons in 2021, surpassed 100,000 tons in 2024, and set an all-time record of 106,698 tons last year. Coffee import value rose from the 300 million dollar range in 2020 to 400 million dollars in 2021, exceeded 500 million dollars in 2022, and crossed the 800 million dollar mark last year.

Breaking down the details, imports of caffeinated coffee declined by 17.4%, from 98,098 tons in the first half of last year to 81,016 tons in the same period this year. In contrast, decaffeinated coffee imports increased by 21% from 4,452 tons to 5,388 tons over the same period.

The sharp fall in coffee imports this year is attributed to the lingering high prices for coffee beans and sustained high exchange rates, which have raised raw material costs. Because most domestic coffee chains source beans from Brazil and other countries, fluctuations in bean prices and exchange rates are directly reflected in sourcing costs.

According to the Korea Agro-Fisheries & Food Trade Corporation (aT) Food Industry Statistics, the average price for Arabica beans, a representative variety, traded at 3 dollars per pound on the Intercontinental Exchange (ICE) in the first half of this year. Last year, the average price of Arabica was 3.7 dollars per pound, a 57.4% year-on-year jump. The monthly average crossed 4 dollars last November, hitting a record high. Although prices eased somewhat in 2026 compared to last year, they nevertheless remain at elevated levels relative to previous years. For instance, comparing 2020 (average annual price: 1.1 dollars per pound) with the first half of this year, the amount spent on imports is more than double despite similar import volumes.

The KRW-USD exchange rate also shot up from an average of 1,426.71 won in the first half of last year to 1,484.56 won in the first half of this year—an increase of nearly 60 won—greatly amplifying sourcing cost pressures.

This situation has persisted into the second half of the year. On July 16, the price of Arabica beans was 3.2 dollars, slightly up from 3.1 dollars at the end of June. While the price hovered in the 2-dollar range until June, it spiked to 3.6 dollars on July 6 before fluctuating in the 3-dollar band. The exchange rate, although recently dipping to the 1,400 won range, remains at a high level.

The coffee sector has faced visible profitability challenges since last year. SCK Company, the operator behind Starbucks Korea, posted sales of 3.238 trillion won last year—a 4.4% increase year-on-year—but operating profit fell 9.3% to 173 billion won. The operating margin dropped from 6.2% in 2024 to 5.3% last year.

Dong Suh Foods, the nation's leading coffee mix producer with brands like Maxim and KANU, recorded consolidated operating profit of 179.3 billion won last year, a 1% increase from a year earlier. It defended profitability by cutting selling and administrative expenses (including advertising costs for brands such as Mitte) by over 20%, thereby lowering sourcing costs. Due to this, it remains uncertain whether the company's annual Maxim Pop-up Project, held every year since 2015 except during the COVID-19 period, will take place this year.

Some coffee shops have responded by raising product prices starting in the first half of the year. The Coffee Bean & Tea Leaf hiked some drip coffee and decaf bean option prices by 200 to 300 won in January, and further raised stick coffee prices by up to 8.1% in June. In March, Banapresso raised prices for select items such as decaf and cold brew by up to 700 won, while The Venti and Ediya Coffee implemented price increases in May. Starting June 19, MegaMGC Coffee increased prices on three "Halmega Coffee" lineup items by 200 won each. Further price hikes by other brands or for additional menu items cannot be ruled out this year.

An industry representative commented, "Soaring bean prices and rising exchange rates are creating intense pressure. Since it's not always possible to simply raise prices for these reasons, companies have no choice but to absorb costs internally. In an environment already marked by fierce competition among brands, prolonged stress from these factors could lead to an overall deterioration in industry profitability."

This content was produced with the assistance of AI translation services.