Farmers say it’s getting more
expensive to grow coffee beans, which could begin
filtering down to your local café before the end of the year and into
2022.
A crop loss of Arabica beans in
Brazil is one of the biggest reasons for the spike. The bean is used for most
coffee sold around the world. Farmers say frost damage has hurt Arabica
bean crops, and it's getting more expensive to keep up with demand.
The loss equates to anywhere
between 2 and 6 million fewer bags of coffee, which is about 12%
of what is made in Brazil.
Lower supplies almost always mean
higher prices, but it also depends on where you get your coffee. If you buy
beans in the store, you'll likely see a more noticeable jump -- about half the
cost of the bag comes solely from the bean itself.
Customers will see a smaller
increase at large coffee shops because the cost of the bean only represents
about 5% of a cup of coffee.
Starbucks, the
world’s biggest coffee retailer, suggested that it won’t need to raise its
prices because of Brazil’s lower output. On a call with investors at the height
of the Arabica price spike, the Seattle-based coffee chain’s president
and CEO Kevin Johnson said his company has 14 months of supply, which he says
will get it through 2021 and most of fiscal 2022.
AP wire services
contributed to this report.