Coffee Prices are on the rise due to Climate Change

Interesting Article worth reading to understand why coffee prices are rising so much across the world...

By Adriene Hill Marketplace Morning Report, Monday, April 25, 2011

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Thanks to unusual temperatures and rainfall, coffee production is falling in some parts of the world, just as emerging markets like India and China are embracing the drink.

Freshly-roasted espresso coffee beans cool in a refurbished 1918 Probat coffee bean roaster. (Sean Gallup/Getty Images)

Jeremy Hobson: The price of coffee beans is above $3 a pound for the first time since the 1970s. And experts say coffee inventories are unlikely to build up in the forseeable future. Worse yet, some are saying we've reached "peak coffee" levels.

Here to explain is our sustainability reporter Adriene Hill. Good morning.

Adriene Hill:Good morning Jeremy.

Hobson: So what is going on here? Why are we talking about peak coffee?

Hill: Well, coffee production in some parts of the world is falling. Places like Colombia have seen their coffee production really just decline pretty dramatically since 2007. And a lot of what's happening seems to be related to weather issues. So they're seeing unusual rainfall, they're seeing unusual temperatures. These things are not good for coffee beans; especially the very finicky, the very precious arabica bean is not interested in big weather changes. And the problem is, it looks like, and some scientists think it could be related to climate change.

Hobson: Climate change, so it's not a temporary thing?

Hill: That's the big worry, and that's why we're talking about peak coffee. Right now, it's so concerning that some international organizations have actually turned to the United Nations and said that, hey, let's start talking about coffee crops. As you look for it, as you start thinking about climate change globally, we need to pay attention to the coffee supply.

Hobson: And what is all this going to do to coffee prices?

Hill: You want to guess?

Hobson: Uh, going up?

Hill: Up is right. Way up. So coffee production is falling at the same time that people in emerging markets like India and China are realizing just how delicious and wonderful coffee really is. And the price of coffee futures -- what the traders buy and sell for it -- has doubled in the last year.

Hobson: So not good news at all for coffee drinkers.

Hill: Not at all. Starbucks just upped the costs of its bagged coffee about 12 percent. Kraft announced it would bump the cost of Maxwell House by more than 20 percent. And that's just one in a series of price hikes. So our morning coffee is going to get a lot more expensive, which is bad news for me.

Hobson: And me as well. And probably most of the people listening right now. Thanks Adriene, Marketplace's Adriene Hill.

Hill: Thank you Jeremy.

SCAA's Annual Exposition and the National Barista Competition

Specialty Coffee Association of America is having their

3RD ANNUAL SCAA SYMPOSIUM: THE EXECUTIVE SERIES in Houston, Tx this weekend paired with the
23rd ANNUAL SCAA EXPOSITION
AND THE NATIONAL BARISTA COMPETITION!

This is a big weekend in the specialty coffee world, and our coffee sourcer of our La Armonia Hermosa coffee, Les Stoneham, is taking a front seat. He's been able to listen to some of the most forward thinking people in coffee, and sit down and have a delicious dinner with them. We hope that he has a lot of fun and learns a lot!

Coffee prices are on the rise

We found this article quite interesting. In fact just this weekend Starbucks had to raise their prices by $1 also. Please read below for more information. If you have questions about why this is happening, don't hesitate to call (865.681.0517) or email us (info@viennacoffeecompany.com).


By Marcy Nicholson

NEW ORLEANS, March 17 (Reuters) - Kraft Foods Inc

said Thursday it raised its U.S. list prices for Maxwell House

and Yuban ground coffees by a whopping 22 percent and its

instant coffee by around 10 percent.

The price hikes, which were effective on Wednesday, marked

the company's fourth coffee price hike in a year and came after

arabica coffee futures soared to a 34-year high this month.

"(The) increases are due to sustained increases in green

coffee," Kraft spokeswoman Bridget MacConnell told Reuters on

the sidelines of the annual National Coffee Association meeting

in New Orleans.

The company raised the price for Maxwell House and Yuban

ground coffees by 70 cents per pound equivalent, and for

instant coffees by 6.25 cents per ounce.

Excluded from the increase were single-serve Tassimo items

and the Maxwell House International line of specialty soluble

beverages, MacConnell said.

Arabica coffee futures more than doubled in price by early

March in a rally that began in June 2010 on fund buying and

tight supplies, with the benchmark May contract reaching

a 34-year high for the second position at $2.9665 per lb.

Roasters have been forced to raise their list prices over

the past nine months as a result of the sustained rally.

Kraft most recently raised its prices in December. J.M.

Smucker Co , known as the trendsetter for coffee price

changes, most recently increased its coffee prices last month,

by 10 percent.

Robusta futures trading on Liffe in London have

joined in the rally, soaring to a three-year high at $2,661 per

tonne on Thursday.

(Editing by Walter Bagley)

((marcy.nicholson@thomsonreuters.com; +1 646 223 6043; Reuters

Messaging: marcy.nicholson.reuters.com@reuters.net))

The coffee that's Bigger than the Human Stomach

This is a disturbing article we were sent from The Independent.

By Martin Hickman, Consumer Affairs Correspondent

Thursday, 20 January 2011

GETTY IMAGES

At 916ml the Trenta is Starbucks' biggest coffee, 325ml larger than the next size down

Starbucks, the American coffee giant which translated Milan's espresso bars into an identikit global chain serving half pints of coffee-flavoured frothy milk, has launched another innovation: a super-sized cup that contains more liquid than an average human stomach.

Even a nation as obese as the United States expressed surprise at yesterday's introduction of the Trenta receptacle ("Thirty" in Italian), which carries 31 fluid ounces (916ml) in one cup – equivalent to more than an ordinary bottle of wine.

Launched initially in 14 US states, the transparent cup – 63 per cent larger than the chain's previous largest size, the Venti (561ml) – will carry only iced coffee, iced tea and iced-tea lemonade. Starbucks said it was launching the cup in response to demand.

The Seattle-based chain, which has not yet said whether the drink will head across the Atlantic, said its unsweetened drinks would have fewer than 90 calories and sweetened versions fewer than 230.

Its introduction, following Starbucks' decision to drop its name from its redesigned logo earlier this month, prompted one commentator to speculate whether the corporation was going through a mid-life crisis prior to its 40th birthday on 30 March. In mocking animations posted online, zombie customers lurch into Starbucks, staggering out carrying cups larger than their bodies.

The drink's arrival looks like an attempt to increase custom among Americans, the ninth-fattest nation on Earth and the most obese major nation. Fast food and grocery firms there sell an increasing number of super-sized colas and coffees: the grocery chain 7-Eleven has cups called Big Gulps which can carry three pints, while Starbucks' increasingly close competitor, McDonald's, sells ice teas in 32 fluid ounce buckets for $1.

The website HealthHabits described the Starbucks cup's introduction as "a breakthrough for human obesity". It assured readers that, although a Trenta was larger than an average stomach, their stomachs would expand after drinking three or four.

Howard Schultz, Starbucks' chief executive – a tough marketing executive raised in Brooklyn's housing projects who has revived the £7bn-a-year company since returning to the helm in early 2008 – is thought to have been behind the Trenta. Mr Schultz has been behind most of the innovations that have turned the company into a multi-national marketing success.

After a visit to Milan in 1983, as the company's new marketing executive he came up with the idea of recreating state-side the popularity of neighbourhood espressos bars where people stopped to chat and sink milk-less shots. Schultz persuaded senior management, which had been selling coffee beans, to sell fresh coffee and hit on the addition of milk, claiming to have discovered the latte in the Italian city of Verona.

Mr Schultz's borrowing of Italian words to name the drinks sizes has also paid dividends. "Of course not everyone is thrilled to have to use ridiculous-sounding made-up terms just to get a cup of coffee," wrote Taylor Clark in his even-handed history of the company, Starbucked: a Double Tall Tale of Caffeine, Commerce & Culture. "Some customers stick to 'small', 'medium' and 'large' as a display of personal integrity – but Starbucks-speak works." He added: "Consider this: for which of the following options would you be willing to pay more for: a 'grande caffe misto' or a 'medium coffee with milk'?"

To help customers to navigate its complex and – to the uninitiated – bizarre blend of Italian and marketing, Starbucks once published a 22-page booklet to its orders called Make It Your Drink. Writing for the Washington Post, Alexandra Petri described Trenta as sounding like "one of those hip gender-free monikers for kids ('Jayden, meet Trenta')" or a place where a Second World War summit may have taken place. She quoted Mr Schultz's remark in a memo four years ago that Starbucks had lost some "romance and theatre" and that customers lacked an "intimate experience with the barista". "We understand your worries, but this is ridiculous!"Ms Petri wrote. "Now look at you! Changes to appearance! Changes to diet! Next you'll buy a sports car, take up transcendental meditation, and leave us for someone younger!

"I know you feel threatened by McDonald's... doing all the things you used to... but cheaper, and with a taste less like cauterized rubber. But the answer is not to try to become McDonald's."

What's in a name?

Starbucks has three main sizes: Tall (354ml – more than half a pint); Grande (473ml), and Venti (561ml – one pint).

The new size, Trenta, is 916ml, or more than one and a half pints. The names are Italian: Grande meaning large, Venti is twenty (the cup is 20 fluid ounces), and Trenta is thirty – for a cup containing 31 fluid ounces. Starbucks trademarked Venti, prompting coffee consultant Bruce Milletto to say: "One day I expect to pick up La Repubblica and learn that Starbucks has purchased the entire Italian language."