Exporters of coffee found a new place where the merchandise earns its price hike. New York City, the location of most coffee shops in the world, is said to be the place where coffee's price will increase over 20% in the forthcoming months. The beans will most likely outstrip other important merchandises to exporters like silver and copper.
Procter & Gamble Co., the company that creates Folgers coffee brand, and Kraft Foods Inc., the manufacturer of Maxwell House coffee are the two companies that have high purchase need for the said beans. Coffee exporters and vendors are resorting to arabica coffee beans that are highly marketed particularly in the said city, after a more affordable kind of beans known as robusta made a recovery in its price after a period of decline in Britain last August.
Raymond Keane, a trader who works for one of US' major exporters of coffee beans that delivers the beans for PG and Kraft, said that the rise in robusta's cost will bring other grades of coffee into the market. In the meantime, Michael Coleman, the managing director to Aisling Analytics said that the price of coffee beans in the Big Apple might possibly reach up to $1.30 per pound on the following year. He also added arabica beans are much cheaper at approximately $1.08 compared to robusta, which has raised its price to over 25 percent.
The International Coffee Organization (ICO), on the other hand, believe that there will be two percent increase in the worldwide consumption of coffee to seven million tons. ICO is the intergovernmental organization of coffee exporters and importers from different nations. The body based in London helps in promoting and increasing the worldwide consumption of coffee, and in boosting the quality of the globe's famous beans to prevent the downfall of world coffee prices. This predicted increase will be pushed through by Starbucks Corp., the popular coffee shop based in Seattle, Washington.
Most coffee beans produced, specifically arabica, comes from Brazil. But on the contrary, Conab, the agency that forecasts crop production for the said country's agricultural department declared that on the coming years, its farms might not be able to hit the same production rate that it had this year. The Brazilian government recently increased its appraisal of coffee production over 40 million bags, which weighs 60 kilos of coffee per bag. Exporters said that the coffee production of Brazil might soon degenerate since the coffee farms take their brakes after large harvest periods. The dry season also affects the Brazil's coffee farms since the blossoming of coffee flowers on October can be harmed by the absence of rainfall.
In London, the price of coffee jumped steadily last year after the harvesting in Vietnam decreased because of the dry season. While Brazil is deemed as the largest producer of arabica coffee, the said Asian nation, on the other hand, is considered among the major exporters of robusta grade coffee in the market. The global supply for coffee suffered from a huge decline because growers and exporters stopped raising trees after the plenitude that occurred five years ago.
Founder of Atitlan Network