Frost, drought could drive coffee prices even higher | Connecticut News
(WFSB) – You have probably noticed your cup of joe cost you a little bit more than normal.
Some shops are hoping to not increase their prices, but the new year might force some changes.
“I have to sit down with the books, I have to make the numbers work, and I always have to keep in the back of my mind people that are going through our doors,” Jasmine Jeffrey, owner of the Cara-Bean Watertown Cafe, explained.
For now, Jasmine’s holding steady with prices, despite her struggle in finding cups and lids, but with coffee prices rising, suppliers are warning…
“They said, eventually, we will see an increase in that as well, because they buy from straight Italy, the coffee from there, so it’s going to go up, but as a matter of when, we will see,” continued Jeffrey.
The Connecticut Food Association says green coffee has doubled in price, from $1.20 in 2020 to $2.37 in 2021.
According to the International Coffee Organization, coffee prices in November reached a ten-year high.
One of the biggest reasons? A severe drought and frost conditions struck brazil, which is the world’s largest supplier of coffee beans.
Inflation is another reason.
“We had a three fold increase in the price of coffee in Colombia. That means farmers are selling them for more, but we also had a three-time increase in the supplies, the pesticides, all the grow supplies,” Eduardo Garces, owner of Cafe Real in Bristol, said.
Eduardo says coffee prices rising is beneficial, because his family grows their own product in Colombia, so people are turning to specialty coffee, because it’s high quality and now similar in price.
“C-market coffee. That’s the average coffee that trades in the stock market. It’s not so readily available and because they are spending an extra dollar more for their coffee, they are forced to look for better quality coffee as well and that’s great for our business,” Garces added.
Other coffee shop owners say these price jumps are not a short term situation, because weather patterns and climate change are impacting where they get their product.
As for national companies, like Starbucks, a representative tells us there are no planned price increases related to the coffee situation.
The representative added:
- Starbucks will continue to only purchase high quality arabica beans.
- We purchase green coffee 12-18 months in advance which gives us more certainty of price and adequate supply for our roasting plants.
- We have adequate supply of green coffee which enables us to manage our cost-basis for that green coffee.
- Managing coffee purchasing this way reduces volatility for everyone, and we continue to pay premiums that support farmer livelihoods above commodity market price.
- There are many factors that contribute to pricing decisions, including various rising operating and occupancy expenses (i.e. labor, rent, local mandates and regulations, competition, distribution, marketing, and commodities – including coffee – but also other commodities associated with beverages, foods, materials and operations).