The J. M. Smucker Company
) has announced that it will slash its packaged coffee prices by an
average 6% owing to continuous decline in green coffee costs.
Smucker, which is slated to release its fourth quarter and
fiscal year 2012 earnings on June 7, is cutting prices of coffee
products sold in U.S. under the brand names of Folgers, Dunkin'
Donuts, Millstone, and Cafe Bustelo. However, this does not include
coffee or other products sold in the Dunkin' Donuts restaurants, as
they are not marketed by the company.
Earlier in August 2011 too, Smucker had cut the coffee prices by
6% for its coffee brands, including Folgers, Millstone and Dunkin'
Kraft Foods, Inc
) also followed in Smucker's footsteps and slashed the price of
popular coffee brand Maxwell House by 6%, resulting from a drop in
the prices of roast or ground coffee as weather conditions favored
the coffee crops.
The prices of green coffee, on the contrary, were very high in
2010 and early 2011. Smucker and other coffee companies like
Green Mountain Coffee Roasters
) raised their prices that time due to high green coffee cost
inflation and other factors like higher demand for the product and
The profitability of Smucker largely depends on the prices of
green coffee. Coffee prices are highly volatile and are affected by
weather and pest damage and also from political decisions in the
coffee-producing countries. Moreover, worldwide supply and demand,
the relative strength of the dollar, and speculative trading also
influence the coffee prices.
GREEN MTN COFFE (GMCR): Free Stock Analysis
KRAFT FOODS INC (KFT): Free Stock Analysis
STARBUCKS CORP (SBUX): Free Stock Analysis
SMUCKER JM (SJM): Free Stock Analysis Report
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