Has Specialty Coffee Lost Its Mojo?

Over the past decade, specialty coffee in Australia has shifted from a buzzword to a mainstream expectation.

Once a differentiator, the term “specialty” is now widely used—even abused—by brands of all sizes. But has specialty coffee lost its meaning, and what does the future hold for roasters, cafés, and consumers?

The Dilution of “Specialty Coffee”

Every brand now claims to be “specialty,” regardless of sourcing or quality.
No universal regulation or compliance exists, except limited Fairtrade certification (<1% of global production).
Large retailers leverage buzzwords like artisan roasted or sustainably sourced without delivering true specialty quality, cloaking their cheap offerings in crafty packaging to appear like premium products.

Declining Enthusiasm in the Industry

Roasters are less focused on extravagant lots or experimental processing.
Interest in Cup of Excellence programs and barista competitions has waned.
Elitist events featuring $300/kg Geisha lots feel disconnected from everyday Australian coffee drinkers.
Specialty coffee has matured—no longer new, different, or sparking curiosity.

Economic Pressures on Coffee Brands

Rising costs (raw coffee up 300% in 4 year, gas up 200%, electricity up 100%) squeeze margins.
Selling prices remain flat due to competitive saturation.
Unlike industries with limited suppliers (e.g., cardboard cartons), coffee’s 2,200+ brands prevent price control.
Most roasters are small (≤5 employees), making scale and efficiency difficult.

Oversupply vs Demand

Coffee market capacity grows at roughly ~20% annually, while demand rises only ~4%.
Too many roasters chasing too few customers.
Low number of brand closures, plenty of new entrants keep flooding the market, driven by romantic notions rather than solid business fundamentals.

Hospitality Segment Under Strain

Cafés face wage scandals, insolvencies, food delivery disruption, staff shortages and skyrocketing rents.
Many cafés fail due to supplier debt and cash flow issues, not rent alone.
Café numbers peaked around 2016, but closures and sales are now common.
Social media scrutiny, staffing challenges, and slim margins make café ownership feel like a prison sentence.

The Road Ahead for Specialty Coffee

Specialty coffee is now the baseline expectation, not a differentiator.
Future innovation lies in:
- Distribution models that preserve quality.
- Brewing and extraction methods that elevate everyday coffee.
- Café transformation into food & beverage hubs with delivery and loyalty programs.