Coffee prices have significantly risen, with wholesale arabica reaching $4.30 per pound and the average price of ground roast at a record $7.25. Factors influencing these price hikes include climatic events affecting crop yields and the speculative nature of the market. Companies like J.M. Smucker are forced to adjust consumer prices while acknowledging the long-term cost impacts. Despite these challenges, consumer demand remains strong, allowing companies to be flexible with pricing amid rising costs in the coffee market.
At the end of the day, we have to be responsible. We want to make sure that we are able to pass along cost changes both up and down, and we do intend to do that.
I would highlight that the market for coffee today is very speculative, because we haven't hit harvest season yet.
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