Well, hey! Lets celebrate the New York “C” market crossing the $2 per pound threshold for commodity grade coffee. Its a huge psychological barrier and it represents something like the highest price we’ve seen for coffee since 1997. You’ve probably already seen the prices go up at your favorite coffee pub. Let’s be clear about one thing…the movement in coffee is driven by speculators. The folks that brought you $140 oil, bird flu, genital herpes, and meatless Mondays.
Why do they mess with our favorite brew? Prices have risen nearly 50% this year. OK, there are some countries that are having shortages, but on the other hand Brazil is expecting its largest crop in years, and Brazil is the largest coffee producer in the world. Well what the heck, coffee is still cheaper than a can of soda. Figure it this way…approximately 25 cups per pound of coffee, if you pay $10 then that’s $.40 per cup. A can of Coke is a buck at least. So lets knock back a double espresso and sit on the sidelines and watch the hedge fund managers fight it out. Cheers.
