Saturday, May 28, 2011

Price for coffee increases but consumers need that fix!

Not only are consumers paying more money for gas these days, but the price of coffee is outpacing the pump.

Coffee drinkers may have noticed the uptick in brewed or packaged coffee, but are willing to pay for cheaper coffee instead of giving it up. The drink remains essential for many consumers. Price for Folgers and Dunkin' Donuts coffee has increased 11 percent, for the fourth time in a year. Prices of Kraft and Starbucks coffees have increased as well.

A one-pound can of ground coffee sold for $5.10 in April, up 40 percent from $3.64 the year before, according to the Department of Labor. By comparison, a gallon of regular gasoline cost $3.83 on average on Tuesday, up 37 percent from a year earlier.
And, in contrast with expected stabilization in fuel prices, the coffee increases could continue for a while because the prices coffee companies pay for unroasted beans are still climbing — and fast. Coffee futures were trading for $2.61 per pound Tuesday, roughly double a year earlier.

And in March Starbucks Corp., the world’s biggest coffee chain, raised the prices it charges retailers for packaged Starbucks and Seattle’s Best coffee by 12 percent, citing higher bean costs. Starbucks left up to grocers and other retailers whether they passed along the increase to consumers. But it said it had locked in the prices it pays for beans the remainder of the fiscal year.

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