Coffee prices up from wholesale to diner

June 4, 2011 at 1:34 AM

LOS ANGELES, June 4 (UPI) -- Wholesale coffee prices have risen significantly this year, sending the price of a pound of coffee at the market or a cup at the diner up as well, dealers say.

A 1-pound can was selling for an average of $5.10 in April, the U.S. Department of Labor reported. That was up from $3.64 a year earlier.

"These are big increases -- and I don't think we're done with it," Phil Lempert, editor of the SupermarketGuru.com blog, told the Los Angeles Times. "We're going to see higher prices on coffee for a very, very long time."

Tim Castle, a coffee importer and expert, said prices are likely to rise faster at first in stores than in restaurants. He said restaurants often sell brewed coffee for four times what they pay for it, which allows them to hold the line on price increases for a while.

But even there, prices are going up. The Starbucks chain hiked prices for some of its drinks last fall and is planning a 17 percent increase in the price of coffee beans it sells retail in its coffee shops.

Experts say there are a number of reasons for the price increases. They include bad weather in many coffee-growing areas, which has cut down on the supply, while residents of developing countries like China are drinking more coffee, just as they are using more gas.

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