What is the reason for the rise in the price of coffee retail products in the United States? The Future Development trend of American Coffee Market

As the largest beverage consumer in the world, the United States has recently had to choose air transportation because of rising shipping prices and the shortage of some containers, resulting in a significant increase in the operating costs of coffee processors. It is possible that the price of retail coffee products will rise in the short term.

According to the Coffee Finance Network, medium and small roasters in the United States, especially boutique coffee companies, are the most affected, worried about rising transportation costs. Because

Coffee companies either have to bear the corresponding transportation costs or reduce losses by raising the retail price of coffee.

In response, Oliver Storm Shawk, CEO of the coffee roasting company in Olympia, Washington, said: "We currently have delivery contracts in the summer and autumn, and these prices have gone up a lot, by about 15%." We are now trying to decide whether we should bear the cost or adjust the price and increase the retail price. "

"it is now more expensive to bring coffee to consumers than in the past five to ten years." Because as more and more consumers shop online and adopt additional security procedures during COVID-19, there is a growing demand for transportation services, which increases costs in the United States.

Another reason is the lack of containers. During the COVID-19 outbreak, supply in the coffee industry was limited, but not because of production problems, but because of a shortage of containers. On coffee transport routes, the demand for containers is increasing, while the demand for other routes is less, resulting in uneven flow and increased transport costs.

Carlos Mera, an analyst at Rabobank, said: "Container costs are the main problem in the coffee market. The price of routes from Southeast Asia to Europe and the United States has risen due to a shortage of containers. Even if you are willing to pay, you may not find a vacant room. "

In addition, there has been a delay in receiving coffee from Africa and some South American countries and regions. Lee Harrison, a senior executive at Joe Coffee in New York, said that a shipment of coffee from Burundi originally scheduled to arrive at the beginning of this year had been postponed to March.

The shortage of containers not only affects the coffee market, but also brings the same problem to the transportation of other industries, such as the United States, Japan and other countries. Shipping is likely to increase corporate costs on inbound routes in the US by nearly $10 billion, or 100 per cent, by the fourth quarter of 2020, according to market intelligence provider Sipp Global Platts.

There are also many Japanese companies whose import costs have more than doubled. For example, Japanese home appliance manufacturers have to respond by booking container ships a few weeks in advance or adjusting transportation routes.

Contrary to foreign countries, China's container enterprises ushered in new opportunities. Orders from container factories have been increasing since they resumed work in March last year, especially in the fourth quarter, according to CCTV Finance. China's epidemic situation has been effectively controlled, the strong demand for overseas orders, coupled with the port of a large number of empty containers stranded overseas, all these have created unprecedented profits in the container industry.

So will American boutique coffee companies affect coffee supply because of a shortage of containers? Eric Lauterbach, president and chief operating officer of Peet's, said: "We are not worried about supply because our inventory is good."

* Image source: Internet

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