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coffee prices plumetting!!

sarimento1

Contributor
green coffee commodity prices have been plummetting!!
for whatever reason!!

shopping recently, i can find quality roasted and ground coffees for under $3-$5 per pound!!

see below, green coffee commodity prices are now around $1/pound, sharp drop from $1.50-$2.00 of 3-4 years ago!!

Why? What gives? But let's celebrate!!

Image-119.jpg Image-120 (1).jpg coffee prices.jpg
 
The one down side with the falling prices is that poor farmers suffer from the economic loss.

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sarimento1

Contributor
The one down side with the falling prices is that poor farmers suffer from the economic loss.

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I'm not sure this is true!

Farmers obviously reaped benefits from former high prices!

And I've seen no current info about what their costs are!

In any case, we can be sure that the major coffee houses (Starbucks, Dunkin') are benefiting bigtime since we've not seen any retail cup cost reductions!!
 
I'm not sure this is true!

Farmers obviously reaped benefits from former high prices!

And I've seen no current info about what their costs are!

In any case, we can be sure that the major coffee houses (Starbucks, Dunkin') are benefiting bigtime since we've not seen any retail cup cost reductions!!
From industry articles I have read (shared on coffee forums), reports from places like Sweet Maria's, etc., everything I read points to difficulties for the farmers. However, I am certainly no expert.

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sarimento1

Contributor
From industry articles I have read (shared on coffee forums), reports from places like Sweet Maria's, etc., everything I read points to difficulties for the farmers. However, I am certainly no expert.

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indeed! the farmers will always paint a dire situation! no disrespect, just my experience!
 

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That Cafe La Rica, shown last, right - is Nicaraguan, cheap and really pretty good espresso.

We buy it all the time, and for as little as $1.50.


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I had read that coffee supply had risen due to good weather (last year was a good growing season) and better farming practices. But I do not know the whole story. Unfortunately these farm commodities seem to go in boom/bust cycles.
 
High prices lead to competition, which can lead to price crashes; which is bad for the original growers.

https://www.washingtonpost.com/worl...ices-drive-guatemalan-migration-united-states

Guatemala’s coffee farmers are at the mercy of one of the world’s most volatile commodity markets. Over the past two years, the price has been pushed down by the increase in cheap, mechanized coffee production in Brazil — the Saudi Arabia of coffee — the strength of the U.S. dollar and increased production in Vietnam, Honduras and Colombia. It’s a perfect storm that has eaten away at the value of the beans even as the price of lattes and Americanos in U.S. shops has risen.
 

Chef Glenn

Contributor
85% of all statistics are actually made up right on the spot

If the cost of shaving soap can be as low as $2/puck, why don't the up and coming artisan soap makers lower their price,
(I mean I don't know what their "costs" are.) Anyone, anyone?
 

Chef Glenn

Contributor
Just throwing an analogy out there folks.

Sure, I can go into the .99 store and come out with a can or "brick" of coffee.
Commodity coffee prices certainly don't reflect what we actually choose to pay for
our favorite specialty coffee bean.

Kinda like the old adage:

Do you want to feed your horse good, clean, fresh, wholesome oats,
OR
are you willing to settle for oats that have been through another horse?

Shave on friends

Glenn
 
indeed! the farmers will always paint a dire situation! no disrespect, just my experience!
Well, if your employer decided that he needed to cut your paycheck, you probably wouldn't be all sunshine and rainbows about it either.

If you are a producer of a product and the value of that product drops, your revenue goes down. Non-variable expenses tend not to go down. If your expenses stay the same and your revenue drops, you will have less profit. In fact you may run a loss.

We have problems like this where I live. Fresh milk now costs less than it did 20 years ago because of massive oversupply. Not just in constant dollars. It's cheaper in current dollars too. If your pay would revert to less than you earned 20 years ago, with your expenses what they are now versus 20 years ago, how do you think that's going to go for you?

How it goes for the dairy farmers here is that the smaller family operations are going bankrupt and being driven out of business.

As for the coffee producers, if prices are down it would stand to reason they are going to suffer. None of that has anything whatsoever to do with what you pay for a cup at Starbucks. If the amount of money going to the producer went up by an entire order of magnitude, the cost of the coffee would go up a few cents. The producer gets less than 1% of the five bucks you paid for your coffee. The lion's share goes to the workers and the store's landlord.
 
Well, if your employer decided that he needed to cut your paycheck, you probably wouldn't be all sunshine and rainbows about it either.

If you are a producer of a product and the value of that product drops, your revenue goes down. Non-variable expenses tend not to go down. If your expenses stay the same and your revenue drops, you will have less profit. In fact you may run a loss.

We have problems like this where I live. Fresh milk now costs less than it did 20 years ago because of massive oversupply. Not just in constant dollars. It's cheaper in current dollars too. If your pay would revert to less than you earned 20 years ago, with your expenses what they are now versus 20 years ago, how do you think that's going to go for you?

How it goes for the dairy farmers here is that the smaller family operations are going bankrupt and being driven out of business.

As for the coffee producers, if prices are down it would stand to reason they are going to suffer. None of that has anything whatsoever to do with what you pay for a cup at Starbucks. If the amount of money going to the producer went up by an entire order of magnitude, the cost of the coffee would go up a few cents. The producer gets less than 1% of the five bucks you paid for your coffee. The lion's share goes to the workers and the store's landlord.
but the producers usually obtain government subsidies.
the only thing that seems to keep up with inflation is retail prices.
 

sarimento1

Contributor
the $2 "brick" of coffee happens to be one of the best, richest retail roasts that I've found.
from cuban-style roaster in miami.

and as for green coffee pricing, remember, it's a commodity and has fluctuated forever in response to supply and demand swings. but even with green bean at $1/pound, that's still twice the low point of $0.50 back in 2000! here's four decades...

coffee prices.jpg
 
but the producers usually obtain government subsidies.
the only thing that seems to keep up with inflation is retail prices.
I have no idea if the Central American national governments are subsidizing coffee producers. Here in the US, as offended as anyone might be about the government subsidizing production, it still doesn't cover the losses. Very large farming operations take advantage of subsidies and can run a profit that way, but small producers don't get much and are screwed in all directions. Anyone who tells you that farmers are living high off of subsidies is selling you a bill of goods.
 
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