In addition to a price increase and reduction in packaging size, some months ago I noticed the brand of Colombian coffee we usually buy lacked that distinctive aroma only Colombian coffee beans have when the can is opened.
And the usual rich, full coffee flavor seemed flat, and even slightly bitter. Thus, I wasn’t surprised to learn that many of America’s major brands have been quietly changing their coffee blends.
Last June, Daily Finance writer, Rich Smith claimed there’s evidence that major coffee brands are now substituting lower-grade Robusta beans for some of their pricier Arabica, and degrading the quality of our coffee.
“Research out of agricultural bank Rabobank confirms that demand for Arabica beans among coffee buyers “has fallen 27% year-to-date, while Robusta [demand] is 25% higher.”
This seems to confirm a widespread alteration of the bean mix, writes Smith, who adds that at least one coffee roaster has admitted it. In November, Massimo Zanetti USA, which roasts for both Chock full o’Nuts and Hills Bros., publicly confirmed upping its Robusta usage by 25% this year.
Why? Price, of course.
Smith goes on to claim last year, “a shortage of Arabica caused prices of the premium bean to spike as high as $3 a pound – $2 more than what a pound of Robusta would cost. This compares to a five-year historical trend of Arabica costing closer to 70 cents more than Robusta.”
Smith noted the trend had reversed last summer, with Arabica prices falling to just a 62-cent premium over Robusta, ahd he says coffee companies are trying to match demand for their product with a price people are willing to pay.
Mainstream coffee brands such as Kraft’s Maxwell House and J.M. Smucker’s Folgers responded to falling coffee prices by lowering the prices they charge consumers.
According to the International Coffee Organization, coffee prices have “limited potential” for a further decline. The organization cut its forecast for world production because of losses to disease in Latin America.
Agrimoney claims arabica beans prices have fallen significantly from highs set in the first half of 2011.
The price decline was attributed to a strong Brazilian arabica harvest last year, expected to help return the world coffee market to production surplus in 2012-13 after successive seasons of deficit.
“On futures markets, arabica coffee for March reversed early losses to stand 0.3% higher at 148.60 cents a pound in late deals, while London robusta coffee was 0.5% higher at $1,925 a tonne.”
The Nairobi Coffee Exchange reports Kenya coffee prices climbed at the first sale of the year after supplies declined.
The average price for all coffee sold rose 29 percent to $212.55 a bag, from $164.15 at the Dec. 11 sale, the exchange said. A bag weighs 50 kilograms (110 pounds).
January 10th, 2013