Consumers are furious that ground beef, orange juice, eggs, cocoa, and food in general have skyrocketed in price. For low—and middle-income households, a trip to the supermarket has become a painful experience in the era of Bidenomics. Adding to the strain, the cost of a cup of coffee will rise even higher into the end of the year and likely in the first half of 2025.
Bloomberg reports that premium arabica beans are experiencing adverse weather conditions in top producer Brazil, pushing prices up in New York to a 13-year high.
Coffee rallies have been gathering pace from ongoing concerns about harsh weather in top producer Brazil. The nation is wrapping up its 2024-25 harvest and production prospects weakened after heat and dryness hurt fields. Attention is now shifting to next season's potential, and Brazil has been gripped by its worst drought in decades, threatening further crop damage.-BBG
Arabica futures in New York jumped to $2.6475 per pound in New York, the highest since 2011. Prices are up 40% on the year as shortages of the cheaper robusta beans increase demand for arabica by coffee chains.
Bloomberg outlines the latest price hikes:
Across the supply chain, the impact of this year's rally is already evident. JM Smucker Co., whose brands like Folgers and Café Bustelo dominate the US's at-home coffee market, hiked its prices earlier this summer. Restaurant chain Pret A Manger scrapped its UK coffee subscription that gave customers as many as five drinks per day.
Meanwhile, Giuseppe Lavazza, chairman of coffee roaster Luigi Lavazza SpA, told Bloomberg in a separate report that low-cost robusta beans in Vietnam, the world's top producer of robusta, have experienced adverse weather conditions contributing to a production shortfall, thus fueling prices higher and higher.
"We've never seen something like that in the history of our industry," Lavazza said, adding, "And what is very special is the long-lasting effect of this."
Lavazza said the European Union Deforestation Regulation, which will be enforced by the end of 2024, will ensure companies do not source coffee beans from deforested lands.
"No doubt that the coffee that European roasters are going to buy will cost much more," he noted, adding, "Companies in the coffee industry are facing very strong headwinds."
The big takeaway for consumers is that food inflation is very sticky. Get used to higher prices. And somehow, the Marxists in America believe supermarkets are gouging customers.