Coffee—the life blood of offices, the nectar of productivity, the banisher of morning grumpiness—could get even more expensive this year.
Long story short: Brazil, which produces much of the world's coffee, experienced a historic drought in January. This month, the price of the popular Arabica variety of bean that Brazil grows rose to its highest point in two years, at $2.07 a pound.
Experts had previously expected Brazil to have a shortage. Now Brazil's coffee industry reports they have enough surplus to use as a cushion in the market, and supply both their domestic and international demands. But the extent of the crop damage is still not known.
At the same time, worldwide consumption of coffee continues to increase, according to the International Coffee Organization. Last year, demand was estimated at 145.8 million bags of the good stuff, with this year's crop estimated at 145.7 million bags. "It seems likely that the market is heading towards a supply deficit," the ICO reported in March.
Are you freaking out yet? Because I kind of am.
Well, maybe this will calm us (me) down: Roasters tend to keep enough beans around to cover themselves for a few months, so that Arabica price spike from earlier in April likely won't trickle down (or slow-pour, if you will) into our mugs any time soon. That could change, of course, but we shouldn't expect our beloved coffee watering holes to have to suddenly switch to something like tea.
And we've endured a big jump in prices before. U.S. coffee prices rocketed in 2011. Take a look at this chart showing average coffee prices each December (this is courtesy of data from the Bureau of Labor Statistics, which didn't include information for 2008). Coffee prices fluctuated after the 2011 spike and hit a 10-year high at $6 per pound on average last year. Prices have gone down since then, at an average of $5 a pound last month.
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