Coffee Hits 47-Year High
Coffee bean futures are up over 60% this year to $3.18 per pound, the highest level since 1977. Popular robusta bean prices are up over 80%. Coffee companies have no options other than to increase prices for consumers and large chains, led by Starbucks, McDonald’s, and Dunkin’ Donuts. It is too early to tell whether drinkers will move to alternatives or live with smaller portions.
The weather has damaged crops in the nations which are the two largest providers of coffee beans. Brazil tops the list, and Vietnam comes second. Typhoons and the threat of typhoons are among the reasons coffee bean prices have risen in Vietnam. Wet weather conditions have hurt Brazils’ supplies.
China Coffee Demand
Another reason coffee prices have risen is a sharp increase in demand from China. The enormous Chinese coffee chain Luckin Coffee recently signed a deal to buy what Bloomberg calls the equivalent of four million bags between 2025 and 2029.
The coffee price disaster has started to look like the cocoa supply and price problem in the last two years. Prices reached an all-time high earlier this year. Among the reasons were high temperatures and heavy rain in West Africa, the source of about two-thirds of the world’s cacao beans.
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