Dutch supermarkets to pay more for Douwe Egberts coffee as price dispute ends

Supermarkets Jumbo and Picnic will pay significantly more for Douwe Egberts coffee and Pickwick tea as part of a deal to bring the products back to store shelves. The pricing negotiations with JDE Peet’s, the company behind these brands, did not yield the results retailers had hoped for, Picnic CEO Michiel Muller confirmed following a report by De Telegraaf. He warned that consumers should expect to pay more for coffee and tea.

“JDE is increasing its profitability at the expense of consumers and retailers,” Muller said, criticizing the outcome of negotiations with the coffee and tea supplier. He expressed dissatisfaction with the agreed pricing, stating, “Their profitability is already far higher than that of supermarkets.”

JDE Peet’s halted deliveries to supermarkets at the beginning of the year amid intense price negotiations with Everest, the purchasing organization representing retailers. The discussions resulted in a new list of “recommended prices” set by the manufacturer for brands such as Douwe Egberts, Senseo, L’OR, and Pickwick. These recommended prices represent increases of 20 percent to 30 percent. “We find this unacceptable for Dutch consumers,” Muller said, noting that JDE has imposed “significant price hikes” in recent years.

Muller described the new wholesale prices as “impossible for consumers to absorb” and said retailers would have to bear part of the increased costs to keep prices somewhat manageable. “We still need to determine exactly how much, but the massive price increase from JDE means customers will have to pay more for their coffee,” he said, adding that he expects more shoppers to opt for private-label alternatives.

A kilogram of Douwe Egberts Aroma Rood coffee beans now costs 15.99 euros, compared to less than 13 euros a year ago. “We can only purchase at these significantly higher prices. If we don’t, we don’t get supplied. The higher wholesale prices take effect immediately, and consumer prices will follow,” Muller said.

A spokesperson for Jumbo stated that the supermarket felt “compelled” to reach an agreement. “JDE’s brands are too important for us,” the spokesperson said. Jumbo emphasized that it remains “very cautious about raising consumer prices” and considers the supplier’s price hikes “disproportionate.”

Jumbo joined the purchasing alliances Epic and Everest two years ago, alongside Picnic. These alliances, which include German retail giant Edeka and other European companies, were intended to strengthen supermarkets’ negotiating power against major brands.

Retailers argue that branded suppliers have been raising prices more aggressively than necessary. “Their power is enormous,” Muller said. “Consumers want their products, which puts branded suppliers in a dominant position during negotiations.”

He also claimed that JDE’s price increases are unjustified, saying the company has raised coffee prices at a much steeper rate than private-label alternatives in recent years.

JDE Peet’s has been locked in disputes with supermarkets, including Albert Heijn and Jumbo, over coffee prices for months. Last year, JDE proposed price increases that supermarkets deemed unacceptable. The two sides failed to reach an agreement, leading JDE to suspend deliveries to major chains on Jan. 1.

JDE CEO Fabien Simon previously cited external factors as justification for the increases. “The price of coffee beans more than doubled last year due to poor weather conditions in key coffee-producing countries,” he said. Simon also pointed to “multiple supply chain disruptions” and international economic and political factors as contributors to rising costs.