Well folks it looks like the price of Coffee is going up and again it is the typical issue of supply and demand. Unlike the price of fuel where we are worried about the War in Iran that is soon to be or the Civil Rest in Nigeria and disruption in production, the issues with coffee is more about increased demand on the supply and demand equation. More people are drinking coffee it seems. But there are other problematic things, which are driving up the price of coffee; for instance the weather. Just like Hurricane Katrina and Rita caused issues with production and refining and hampering of supplies, coffee too takes a hit when Central America is flooded from Hurricanes and Tropical Storms. Additionally droughts have plagued some of the coffee crops as well. Before the weather issues the International Coffee Organization had predicted a global surplus in coffee, although they are not saying that anymore, not since the weather has taken its tool. In 2006 and 2007 there maybe more production than before but it has barely kept up with demand and no significant global surplus is on the horizon. In English for you and I, well that means higher coffee prices at the market of course. Think on this in 2006. |
