Why is iced coffee more expensive than hot coffee?

Why are iced lattes so expensive? Photo / 123rf

It’s that time of year again - it’s getting warmer, we’re adding new sunscreens to our carts and we’re thinking about swapping out our flat whites for a refreshing iced coffee.

But what with the rising cost of living, the price of coffee seems to be going up as well - and it’s those iced lattes that tend to be the most expensive option on your local cafe menu.

And once again, coffee lovers are up in arms about the price of their beloved beverage, taking to social media to vent their frustration.

@erica_mallett

I don’t get it (and before you come for me I used to be a barista) #Inverted #coffeeinaustralia #coffee #australia #icedcoffee

♬ original sound - Erica Mallett

One TikTok user, Erica Mallett, took to the video-sharing app to reveal what it’s like “ordering an iced latte in Australia”, pointing out that an A$4 cappuccino would suddenly cost A$7.50 if she wanted to add ice.

Mallett, who revealed she used to be a barista herself, said she “doesn’t get” why iced coffee is so much more expensive - and her followers chimed in to call the difference in price “Australia’s biggest scam”.

One viewer even pointed out, “You forgot it’s actually less milk because the ice takes up volume and is way cheaper”, while another wrote, “I don’t get it either. Extra charge for an iced coffee as it has icecream and whipped cream, but an iced latte shouldn’t be more”.

But others sided with the cafes, noting that it’s expensive to run ice machines.

It turns out there are higher costs and more labour involved in making iced coffee compared to hot coffee. Photo / Getty Images

Others pointed out that takeaway iced latte cups tend to cost a lot more than hot coffee cups, and also come with the added cost of straws.

“When I was a barista, our iced drinks cost more because the cost of the iced drink cups [was] literally double the cost of the hot drink cups,” another explained.

These days in New Zealand, an iced latte can set you back $7 to $10 depending on where you get your daily fix.

In 2021, champion barista and now-MasterChef NZ winner Sam Low spoke to The Spinoff about why a cold coffee is so much more expensive than a hot one.

“If you break it down to cost of goods, it actually just works out to be similar if not the same, in terms of profit margins, as a hot coffee,” he explained at the time.

It’s not just the coffee that costs you - it’s the machinery, the packaging and the labour costs behind it.

“The compostable plastic cups or the ice machine that is required aren’t cheap,” he said, adding that making an iced coffee also calls for a trip to the freezer for the barista for every cup, breaking up their workflow.

It’s an “eye-rolling” order for a busy barista in the middle of a morning rush. he said. At the time, Low estimated that anywhere from $5 to $6.50 was a fair price for an iced latte - but in the two years since, we’ve seen the cost of living skyrocket and the price of coffee itself follow suit.

Drought and frost meant a 4 per cent drop in coffee production in Brazil, where the majority of our coffee comes from, in 2022. And that has inevitably contributed to an increase in price in your coffee cup in 2023.

But whether you like it hot or cold, that might not necessarily be a bad thing - there’s no better time to support your local cafe or your local coffee suppliers - and you could even get your barista skills on at home the next time you feel like an iced latte.