Starbucks Corp (NYSE:SBUX) will boost the cost of its packaged coffee sold in its U.S. retail stores by an average of 17 percent, its first such increase since 2009, a spokesman said on Wednesday.
Continue Reading Below
"We continually look at a variety of things that affect the price. The green coffee costs, fuel, those kinds of things and competitive reasons. We make adjustments as needed," company spokesman Alan Hilowitz told Reuters.
Arabica coffee futures traded on ICE soared to a 34-year high at $3.0890 per lb on May 3. The sustained rally began last June on a combination of tight global supplies of high-quality beans and speculative buying. The market has since fallen about 15 percent.
The last time Starbucks, the biggest coffee house chain in the world, raised these prices was in 2009 when the increase was 4 percent, Hilowitz said.
The company announced in March that it would raise the price for packaged coffee sold in grocery stores by an average of 12 percent. In September 2010 it said it planned to charge more for its large-sized and labor-intensive drinks because of surging commodity prices.
In Canada, prices will increase an average of 6 percent, Hilowitz said.