AOL Money & Finance

CoffeeBeans posts

Feed

Coffee demand outstrips supply; coffee stocks up for commodity squeeze?

Coffee is set to be "one of the most promising commodities of 2009," according to a leading Swiss commodities analyst, who predicts coffee prices will rise, likely squeezing the already-decaffeinated profits at Starbucks (NASDAQ: SBUX) and Kraft (NYSE: KFT), maker of Maxwell House, among other major coffee retailers. Current prices are $1.1305 a pound, only up a 0.9% on the year, but experts predict greatly increasing costs due to declining production in Brazil and Colombia. Coffee futures are currently at $1.20 per pound for December 2009 contracts, and $1.227 per pound for March 2010 contracts.

How much price runup are we talking? It could be increasing a whopping 50% to $1.70 per pound by June 30, according to former Merrill Lynch analyst Judith Ganes-Chase, who runs a consulting firm in Katonah, New York.

Continue reading Coffee demand outstrips supply; coffee stocks up for commodity squeeze?

Starbucks to try its hand at social networking

When Starbucks Corp. (NASDAQ: SBUX) brought back founder Howard Schultz to revitalize the company's image, product line and customer experience, the coffee chain's edge had disappeared. It had lost customers, revenue, the niche and most important -- the overall experience -- to newer competitors. That was not to say Starbucks still was not king, but it become diluted in the race for newer growth.

Well, to heck with that. Schultz slowed down growth after re-emerging as the company's CEO early this year, deleted breakfast sandwiches from the menu, retrained the company's baristas and ensured that fresh-ground coffee smells were the number one priority for every customer coming in the door to experience. But Schultz isn't stopping there. He also wants customers to push back to the company using MyStarbucksIdea.com. In other words, the coffeehouse's own social networking site. Schultz wants to empower his customers to help shape the future direction of the coffeehouse he founded.

This is more than a blog or a forum -- customers can discuss ideas, argue about them, post new ideas, vote on ideas and form more opinions on improving the Starbucks experience. Well, I though this was exactly what Schultz was busy doing these days? Is he really interested in what every Tom, Dick and Harry thinks?

Will customers really give him all this feedback? I'm skeptical. I agree that balancing the customer's needs and the business's needs is critical -- one can't overpower the other. Still, will this even have an effect on Starbucks at all? If it really is this interested, it needs to market the MyStarbucksIdea website just as much as its mocha lattes. Give every customer notice that they can have a voice in this.

Starbucks mistreats Ethiopian coffee growers?

ethiopian coffee beansSidamo. Harar. These types of coffee beans in Ethiopia speak to me more seductively than Champagne, Bordeaux, Pinot. Among coffee connieusseurs, these names are the pinnacle of all that's perfect about the bean. Naturally, Ethiopian coffee growers would like to have trademark protection for their most famous varieties.

Not if Starbucks Corporation (NASDAQ:SBUX) has anything to do with it. The coffeeshop chain has, according to British social activist Oxfam, blocked Ethiopian farmers from trademarking their beans. If Sidamo and Harar were trademarked, Ethiopians would have more control over how the names were used, raising the price for their coffee and giving them more money -- $90-$100 million each year, says Oxfam.

Starbucks is a part of the National Coffee Association, which has filed to block the trademark application with the USPTO, and disputes that it was the company's idea. Starbucks doesn't appear to be disputing the block, however; which seems just as bad, to me. Oxfam suggests that Starbucks enter into voluntary licensing agreements with Ethiopia (and they may, indeed, do so -- Starbucks has historically made efforts to treat coffee growers fairly). I'd like to see more proaction on the part of Starbucks than "but it wasn't our idea!" and I'm disappointed with the NCA -- really, give the poor farmers their IP already!

Symbol Lookup
IndexesChangePrice
DJIA-88.5010,202.76
NASDAQ-16.012,150.89
S&P 500-10.671,087.84

Last updated: November 12, 2009: 03:28 PM

BloggingStocks Exclusives

Hot Stocks

DailyFinance Headlines

Latest from BloggingBuyouts

WalletPop Headlines

AOL Business News

BioHealth Investor Headlines

Sponsored Links

My Portfolios

Track your stocks here!

Find out why more people track their portfolios on AOL Money & Finance then anywhere else.

BloggingStocks Partners

More from AOL Money & Finance