Crop damage from the drought resulted in a large number of
speculative investors pouring huge sums of money into the risky coffee futures
market.
Nick Brooks, head of research at ETF Securities, a leading
commodity index fund provider, said:
“Investors piled into coffee in the second half of last year
when the drought in Brazil started to take hold. Concerns over a supply
slowdown has driven the price higher, and speculative investors have taken full
advantage.
“After such a strong run I think speculative investors will
now take profit as the sharp price increase has perhaps been an over-reacted to
the news of drought. Rain has started resuming in parts of Brazil, which will
reverse some of the crop damage and cool the sharp price rises that have
occurred since the start of the year.”
Coffee Compass, the country’s leading online coffee website,
frequently comments on industry news, research and products. A spokesperson for
the company said that while the price has gone up on the commodities market,
the price of coffee in the Coffee Compass store hasn’t and won’t be changing
anytime soon.
“There are a lot of people concerned about the price of
coffee at the moment but there’s little reason to be as our current low prices
aren’t going anywhere soon. Any changes in future are purely speculative and
certainly won’t take effect until much further down the line.
“We’re happy to reassure our loyal customers that our
famously competitive prices on our huge range of coffee beans and coffee making
equipment are still here. While chainstores and supermarkets may be eager to
boost their prices to make extra profit we certainly aren’t.”
Coffee Compass is the UK’s premium online seller of fresh
coffee products. Coffee Compass sells roasted coffee, speciality blend,
unroasted green beans, and espresso, decaf and exotic products. They deliver to
all areas of the UK mainland and provide same day shipping options on orders
placed before 1pm. Visit their website at www.coffeecompass.co.uk to find out
more.
For quotes, contact Richard Jansz of Coffee Compass on: 01903734333