High Coffee Prices Stir Demand for Bean-Free Alternatives amid Climate and Tariff Pressures
Coffee drinkers worldwide may soon be sipping a new kind of brew—not made from beans at all. Soaring coffee prices, driven by climate-induced crop failures and looming tariffs, are pushing consumers and companies to explore bean-free alternatives that promise to be both cheaper and more sustainable.
Severe droughts in key coffee-producing nations like Vietnam and Brazil have slashed crop yields, pushing coffee prices to record highs. With potential new tariffs from the Trump administration set to take effect next month on imports from top coffee-exporting countries, producers are bracing for further cost escalations.
Major players like Keurig Dr Pepper and J.M. Smucker—owner of brands such as Folgers and Café Bustelo—have already responded with multiple price hikes. Smucker alone has raised prices three times since October 2024, with another increase planned this August.
In this high-cost environment, food tech startups are seizing the opportunity. Singapore-based Prefer is gaining traction with its bean-free coffee, made from upcycled food byproducts such as soy pulp and broken rice. The company uses a proprietary fermentation process to mimic the taste and texture of coffee—without the bean.
“Ten or twenty years ago, this wouldn’t have been possible,” said Jake Berber, Prefer’s cofounder. “Today, thanks to supply chain shocks and modern fermentation tech, we can create a product that’s not only more sustainable but also more affordable.”
Founded in 2022, Prefer recently raised $2 million in seed funding led by Forge Ventures to scale up manufacturing. Its coffee alternative is now sold at several dozen cafes and outlets across Singapore, with plans to reach 100 locations by the end of 2025.
While not a complete replacement, the substitute can be blended into regular coffee—up to 40%—without compromising flavor. Prefer also offers customization in caffeine levels, from decaf to double shots, using sources like green tea for extraction.
Looking ahead, Berber aims to expand Prefer’s product line into other climate-sensitive ingredients like cacao, vanilla, and citrus—offering a resilient path forward for the beverage industry in an era of environmental and economic upheaval.