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Arabica coffee futures are about to post their largest annual gain in a quarter of a century due to a global deficit.

Arabica coffee futures jumped 78% to around $ 2.30 per pound in New York this year, putting it on track for the best year since 1994.

Bad weather in Brazil, the world’s largest supplier of Arabica, has decimated coffee plantations, contributing to a global shortage just as demand for the high-end bean variety has increased. This coincided with supply chain bottlenecks, including container shortages and longer shipping times “, Bloomberg explained.

We first documented the tightening of global supplies on March 25 in a commodities note entitled “” Nightmare “of factors driving the world towards a coffee deficit.” Since then the situation has become even more serious.

So what does this mean for US consumer wallets?

According to a recent note from Barclays, US importers such as Starbucks are sheltered for more than a year to cope with price fluctuations. Although JM. Smucker, who owns the Folgers and Dunkin ‘coffee brands, recently warned that supply chain disruptions are driving up costs that will impact his business.

It’s only a matter of time before coffee inflation hits consumers in 2022.



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