The harmonized index of consumer prices (HICP) is a measure of inflation published by Eurostat that’s comparable across all countries in the European Union. It covers all 12 categories of the “European classification of individual consumption according to purpose” (ECOICOP).
FRED has all these data, and the FRED graph above shows some:
- the harmonized index of consumer prices for coffee, tea, and cocoa in the euro area (in red)
- the IMF global prices for coffee (in purple), tea (in green), and cocoa (in orange)
We customized the data to create an index with a value of 100 in the year 2000, when the first HICP data are available, to better compare the changes in commodity prices to the change in the harmonized consumer price index.
So, what’s brewing? Global prices for cocoa and coffee have almost tripled between 2000 and the time of this writing. During that time, the global price for tea has increased at a much lower rate, about 10%. As might be expected, the harmonized consumer price index tracking those categories has also increased. However, that growth was merely 50% because the harmonized consumer price index for the whole of the euro area is an aggregate of the harmonized consumer price index for each of its 19 member countries. As it happens, different countries prefer different comfort drinks.
According to the detailed 2023 HICP data published by Eurostat:
- In Ireland, tea and coffee prices have very similar weights in the calculation of the HICP. So there, the price index of comfort drinks tracks close to the cost of brewing a cuppa.
- In Austria, coffee prices have five times the weight of tea prices in the calculation of the HICP. So there, the price index of comfort drinks tracks close to the cost of brewing a cup of joe.
- In Spain, cocoa and powdered chocolate prices have relatively larger weights in the calculation of the HICP than in Ireland and Austria. So there, the price index of comfort drinks tracks close to the cost of anything chocolate.
How this graph was created: In FRED, search for and select “Harmonized Index of Consumer Prices: Coffee, Tea, and Cocoa for Euro area (19 countries).” Next, click on the “Edit Graph” button and use the “Add Line” tab to search for and add “Global price of Tea, Kenyan.” Repeat the previous step to add “Global price of Cocoa” and “Global price of Coffee, Robustas.” Next, click on the “Edit Line 2” tab and change the units to “Index (scale value to 100 for chosen date)” with 2000-01-01 as the index date.
Suggested by Diego Mendez-Carbajo.