Peak Coffee and green price increases

beanflying

Interesting article on mainly Columbian Coffee but similar things are happening around the world as coffee growing countries become coffee consuming countries and the speculators play with it as well.

http://www.theglobeandmail.com/report-on-business/international-news/latin-american/peak-coffee-a-cup-of-trouble/article2038050/page1/

Koffee_Kosmo

I read the whole 4 pages of that article My take on this is that the people that advocate planting more crops to meet demand should walk in the farmers shoes for a while They should go do it or fund it themselves just so they understand that its not that easy And also to find out that when there is to much coffee or glut times, the price goes down and loose all there investment   KK

askthecoffeeguy

interesting article - it provided a few insights as to what drives coffee prices, as well as showing the farmer's perspective and why its not always possible to increase production p

RichardM

The way I see it, is that coffee itself is too cheap at the moment as it is (which I don't like to admit). The more demand for coffee increases, the way I see, it, the cheap commodotised coffee will stay cheap, and become owned by conglomorates (ie Nestle etc), and the farms will get bigger and more efficient. This will mean that the specialty coffee will become even more expensive. The second side effect, I feel, is that nations that are not currently coffee producing (due to higher labour costs, such as Australia), will begin to feel an economic reason to grow their own, thus increasing production, and stabilising costs. Where this will stabilise....who knows. An example is Mount Tamborine Coffee Plantation. I'm assuming their prices a year ago were deemed "high" but now seem reasonable for roasted at $45/kg.

beanflying

Look out the big gamblers of the world are predicting a coffee price crash already  ::) http://www.businessinsider.com/coffee-prices-the-caffeine-buzz-will-soon-crash-2011-7 The world would be a lot better place without rabid speculators and futures exchanges IMO.

mycuppa

on 1311906485:

Look out the big gamblers of the world are predicting a coffee price crash already  ::) http://www.businessinsider.com/coffee-prices-the-caffeine-buzz-will-soon-crash-2011-7 The world would be a lot better place without rabid speculators and futures exchanges IMO.

I agree - those turkeys make their money on the way up and the way down. Some softening of prices have been seen around the last few weeks with the C retreating down to 240 and the stronger AU combined with supply fears around CentAm and SouthAm slightly abating. Certain origins remain massively overpriced and patchy in terms of quality having suffered from lower recent crop yields and panic buying earlier in the year by those countries that can and do pay premiums, obviously inflating all other stock from that origin, regardless of cup quality. As with all these things, they shoot up very fast, but take a while to retreat due to forward contracted inventories and commitments that can see brokers needing up to 6 - 9 months to shift the goods. We are seeing increased direct trade with farms. This is being driven by roasters looking for exclusive lots in attempt to differentiate and/or origin traders seeking to bypass a few set of hands in the supply chain in their attempts to pursue higher trading profits per pallet. At a local level, roasters typically forward contract around 6+ months and given the majority of CentAm and SouthAm inventories have only been in the country a few months and new crops from PNG and some Africans are due soon, these may have been committed at the top of the market so expect the pricing to relatively static till around end calendar 2011, or at least stabilize - excluding any other crazy world events that could disrupt supply. Other factors like rising energy, insurance, unknowns around carbon trading, higher marketing costs, etc. are likely to compensate for any softening green pricing.

hazchem

on 1306672352:

Interesting article on mainly Columbian Coffee but similar things are happening around the world as coffee growing countries become coffee consuming countries and the speculators play with it as well. http://www.theglobeandmail.com/report-on-business/international-news/latin-american/peak-coffee-a-cup-of-trouble/article2038050/page1/

boooo. Article is now behind a paywall or something.

beanflying

on 1312059688:

boooo. Article is now behind a paywall or something.

Nope works for me still  ??? Going to be a bumpy ride on prices for a few years. The Chinese & Indians amongst others are developing a taste for coffee as well which will soak up some of the increased production.

beanflying

From Facebook and the AASCA page "RECORD EXPORTS OF COFFEE IN 2010/11 Brazil registered record exports of coffee in crop year 2010/11, reaching 34.9 million bags, 17% higher than in the previous year considering exports of both green and soluble coffee. Revenues increased 65% in the same period due to the higher prices of the product. Germany was the main destination of Brazilian coffees (21% of shipments), with a total of 6,697,400 bags, followed closely by the United States (20.7%) and then Italy (9%)." Lean year for beans this year but big $$ and a bumper year predicted for Brazil next years crops then roll the dice on price.

mycuppa

I'm starting to see some softening of prices - but unfortunately not the 8 ton I am receiving tomorrow that was contracted a few months ago. In speaking with a brokers over the last few days, I was pleasantly surprised with some of the budget estimates on new crop pricing - thanks to the strong AU$ Even though the C is still hovering around that 240 mark, I'm seeing about a 20% reduction in top-line pricing compared to 3 months ago when it was all just doom and gloom totally over-run by speculators.

FreshCoffee2

regarding this, from someone's press release" "....So, from August 9, some dadada Coffee stores will be increasing their drink prices by 20