We are on the high side for food budgets (800-1000), but my grocery bill is inflated with "convenience" purchases (no major supermarket on the island) and local purchases (which tend to be higher) and this year, I started including DH's cigars because it's a PIA to go through every receipt and pull those out.
As for coffee, I am not fussy about most food, but I follow the sales for Green Mountain Dark Magic ground coffee, and I stock up. I'd have to be desperate to resort to instant coffee.