Coffee prices on the rise


Senior Member
7 Jun 2011
SINGAPORE: Prices of coffee in Asia have been gaining ground on the back of supply concerns.

Prices of Arabica coffee gained around 60 per cent last year and continued to gain ground in 2011, moving up around two per cent this year while Robusta coffee which is more commonly used in coffee mix moved at a similar pace.

Analysts say rising coffee prices in Asia are inevitable despite sideways pricing in the last few days.

This is on the back of changing consumer tastes in the region.

The majority of coffee consumed in Asia is primarily from Indonesia and Vietnam.

Analysts say that with a series of bad weather problems in Indonesia and Vietnam, tight supply could mean that premiums will stay until next month, or until new supply comes online from Vietnam in November.

As of now, it's good news for coffee drinkers in Asia as analysts say that while prices have been skyrocketing, they don't expect any further substantial movement upward.

In London on the other hand, analysts are expecting prices to come down by 10 per cent from the high.

Avtar Sandhu, manager for Asian commodities at Phillip Futures, said: "We have to look at coffee prices from different parts of the world. If you are looking at the major coffee centres in Europe and London, we have been seeing a downtrend in coffee prices since last May."

Increasing consumption in Asia is also fuelling demand and regional prices.

For example, big corporate player Starbucks is planning to open up 1,000 new stores in China.

Coffee prices on the rise - Channel NewsAsia