Coffee prices have been decimated by worries over a strong Brazilian harvest this year. Not only is the harvest expected to be good in the key producing country, but it also is expected to be in good condition too. This could offset some concerns over a weak crop in other nations, specifically in the case of Colombia. Beyond Brazil, Vietnamese production is also expected to surge this year. The country is already the biggest producer of robusta beans and exported roughly 180,000 metric tons during February. This represents a nearly 25% increase from the year ago period. Given the strength in production from these two major producers, coffee prices could continue to have trouble this year as well. Prices have already dropped by about 20% so far in 2012, plunging from around 22.5 cents per pound at the beginning of the period to current levels around 18 cents a pound. This is even worse when investors look from a longer term perspective as prices were roughly 30 cents a pound at this time last year.
Hard Times In Soft Commodities
Coffee prices have been decimated by worries over a strong Brazilian harvest this year. Not only is the harvest expected to be good in the key producing country, but it also is expected to be in good condition too. This could offset some concerns over a weak crop in other nations, specifically in the case of Colombia. Beyond Brazil, Vietnamese production is also expected to surge this year. The country is already the biggest producer of robusta beans and exported roughly 180,000 metric tons during February. This represents a nearly 25% increase from the year ago period. Given the strength in production from these two major producers, coffee prices could continue to have trouble this year as well. Prices have already dropped by about 20% so far in 2012, plunging from around 22.5 cents per pound at the beginning of the period to current levels around 18 cents a pound. This is even worse when investors look from a longer term perspective as prices were roughly 30 cents a pound at this time last year.