Illycaffè Expands Production to Meet Rising Coffee Demand

Illycaffè, a prominent coffee roaster, is set to expand its production capabilities at its facility in Italy to cope with increasing demand for coffee beans across Europe and North America. The company reported a 19% increase in revenues for the first half of 2026, amounting to €373 million, largely due to sales growth in Italy and the United States where sales also rose by 19%.

Despite high green coffee prices, Illycaffè's organic growth allowed it to navigate cost pressures and achieve a 10% increase in profits, with EBITDA reaching €53 million. Cristina Scocchia, the CEO, described the first half of the year as extraordinary, highlighting the strategic decisions and the value of their personnel as key factors in the company's growth.

In response to the growing demand, Illycaffè is opening a new roasting plant at its hub in Trieste, which Scocchia referred to as a fundamental milestone for the company. Additionally, the company is embarking on a new growth phase in the US through a significant packaging partnership with Westrock Coffee, focusing on ready-to-drink coffee cans.

While coffee prices have slightly decreased from last year's record highs, they remain above long-term averages and too volatile for most roasters to consider reducing prices. Giuseppe Lavazza, chairman of Lavazza, mentioned that the industry needs at least two robust harvests in Brazil and Vietnam to replenish depleted inventories. However, unpredictable weather conditions, including unexpected rainfall in Brazil and potential disruptions from El Niño, pose risks to supply.

Farmers are in a stronger position after several years of high prices, allowing them to hold back coffee rather than sell immediately. Roasters, meanwhile, are purchasing cautiously, waiting to see if prices will decline.