The Clinton Herald, Clinton, Iowa

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March 21, 2014

Breakfast foods are getting pricier

(Continued)

NEW YORK —

"They still need to get a decent breakfast," he says.

COFFEE

You need your morning brew, and you'll likely pay more for it, at least at the supermarket.

Coffee futures have surged 57 percent this year and this month rose above $2 a pound for the first time in two years. Coffee growing regions of southern Brazil, the world's largest coffee producer, have been hit by drought. Analysts are forecasting that Brazil's crop could shrink by about 20 percent this year.

Shoppers should be prepared to pay more at grocery stores, if the current trend continues for more than a month, says Dan Cox, the president of Coffee Analysts, a company that tests coffee quality for retailers.

"Whether it's by the can or the bag, consumers should probably expect to pay 50 cents per pound more, fairly soon," Cox says. The average price of coffee for U.S. cities was $5 a pound in February, although that was little changed from a month earlier, according to government data.

Caroline Krajewski, a spokeswoman for Kraft, which owns the Maxwell House coffee brand, declined to comment on the company's pricing plans.

The price impact will be less noticeable at coffee stores. That's because the cost of beans makes up only a fraction of the final price, compared to other costs like rent and staff wages, says Alon Kazdan, 40, the owner of Cafe Noi, a small chain of coffee shops in New York. Espressos at the cafe cost $2.40; Americanos are $3; lattes go for $3.60.

He says prices should also remain in check because of competition between the companies that roast the beans into the coffee. As for rising commodity prices, he puts that down to speculation.

"People like to make panic for nothing, in order to make money," he says.

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