Why you’re paying double the price for an iced coffee

The discrepancy between the price of a hot coffee and that of its iced counterpart is one of life’s great mysteries. Here’s why you’re paying more.

Say what you will, but the discrepancy between the price of a hot coffee and that of its iced counterpart is one of life’s great mysteries.

“What is way too expensive, but shouldn’t be?” Nathalie Jacoby asked in a January tweet, to which Sydney journalist Isobel Roe responded: “Iced coffee.”

“It’s the same as hot coffee but you don’t have to froth the milk. Why is it $7.00?” she continued.

Iced coffee. It’s the same as hot coffee but you don’t have to froth the milk. Why is it $7.00? https://t.co/3P9lsIGsRd

— Isobel Roe (@isobelroe) January 16, 2023

Roe’s tweet generated a dozen responses of its own, all echoing the same sentiment.

“Don’t even get me started on an iced long black! There isn’t even milk!” one person said.

“I had this exact thought today!!! (I bought it anyway) I think it’s because iced is generally 2 shots,” wrote a second, while a third (rightly) pointed out: “And there’s less milk in it because of the ice!”

Simply put, as one Twitter user who has been robbed blind by the cost of this beverage did: “Being obsessed with iced coffee is the most expensive decision I’ve ever made.”

The premium for an iced latte is criminal https://t.co/vvizRRjVzU

— lavender baj (@lavosaurus) January 16, 2023

being obsessed with iced coffee is the most expensive decision i've ever made

— M O O D âš¡ (@ITSMOODYAF) September 19, 2022

We are not, of course, talking about the Jamaica Blue definition of an iced coffee here. If you, a grown adult, are willingly asking for a drink that includes not just ice cream but whipped cream as well, and then whining at the $9 price tag, all I will say is, you brought it (and the inevitable lactose intolerance) upon yourself.

We’re talking about what is literally a cup of ice (made from water – which is free last I checked), one or two shots of coffee, and the addition of milk.

Why it comes at a cost that will shut me out of the housing market for good is a global question for the ages – or at least since 2012, when New York Magazine ran an investigation titled: “The Iced-Coffee Economy: Why the Cold Stuff Costs More”.

‘I am here to rob you of all your money.’ Picture: iStock

The piece concluded the higher price is driven by a number of factors – including different brewing techniques that entail a more tedious process.

“Like the hot stuff, cold-brewing involves mixing pulverised beans with water, but the latter process requires about twice as much ground coffee,” it explained.

“Those grounds infuse filtered water for 12 to 24 hours, creating iced-coffee concentrate. That liquid is cut with water to taste, at a ratio of about one to one. Yet even after all this dilution, a cup of cold-brewed joe can include 62 cents worth of ground coffee. A hot cup might include 35 cents worth of beans.”

At home, while the Australian Bureau of Statistics doesn’t monitor the price of takeaway coffee, as part of its March quarter reading last year it found grocery-bought coffee, tea and cocoa rose 8.2 per cent year-on-year.

Store-bought coffee, which is at the mercy of similar global price pressures as beans sold to cafes, rose 6.9 per cent compared to the previous December.

Packaging – namely the clear, plastic cups an iced latte is usually served in – and straws also supposedly account for the increased cost.

Other stories in the 11 years since that New York Magazine one was published have theorised it could be the additional labour required.

But as someone who toiled away behind a coffee machine for three years during university, I can tell you, hand on heart, this is bullsh*t. Any drink that did not require the added pressure of overheating (thus splitting) a jug of soy milk was considered a treat to make.

Not everyone agrees on this – coffee-making expert Sam Low told New Zealand’s The Spinoff the leap in price is justified because “you’re essentially slowing down workflows so it does take longer to produce”.

“It’s funny,” he said of being tasked with making an iced latte. “It’s one of those eye-rolling kind of things if you’re on shift and super busy.”

The idea that ‘adding ice’ makes it more expensive is bullsh*t. Picture: iStock

Another bullsh*t theory, according to academic at London’s Queen Mary University Markman Ellis, is that “adding ice” makes it more expensive.

“Ice isn’t expensive, it’s just water, of course – and certainly not more than the milk or coffee it replaces,” Ellis, who is the author of The Coffee House: A Cultural History, told Vice.

“I suppose there might be a marginal cost in having a special ice making machine which only gets used for a few months a year.

“But basically, the higher price for iced coffee is just extortion: coffee chains know that when it is hot, we want iced coffee, so they rack up the prices.”