By Chris Prentice - Feb
24, 2011 12:00 AM ET
Coffee May Jump 48% as Demand Can’t
Be ‘Satisfied:’ Chart of Day
prices, which have doubled in the past year, may rally
another 48 percent to the highest since at least 1972
as demand outpaces supply, according to Hackett Financial
CHART OF THE DAY shows that coffee has surged as demand
grew in countries that ship the commodity, including
Brazil, the world’s biggest producer. Prices may climb
to $4 a pound in 12 to 18 months as demand gains 3 percent
in the exporting countries, eroding dwindling stockpiles,
said Shawn Hackett, president of Hackett Financial.
current demand cannot be satisfied,” Hackett said by
telephone from Boynton Beach, Florida. “The price will
continue to go up until people who drink coffee drink
consumption in emerging economies will be the main driver
for coffee prices, Hackett said. Accelerating economic
growth boosted demand in exporting nations by 23 percent
since Sept. 30, 2005, according to data from the International
Coffee Organization. In that time, stockpiles in the
nations have plunged 65 percent, the group said.
arabica coffee for May delivery fell 1.8 percent to
$2.6945 a pound on ICE Futures U.S. in New York. The
price touched $2.784 on Feb. 22, the highest since May
1997. The commodity touched $3.375 in April 1977, the
highest according to Bloomberg data that starts in 1972.
data is based on an average global crop year that runs
from October through September.