Coffee Shortage Percolating

Brazil likely to produce fewer beans next year
Posted Dec 9, 2008 12:42 PM CST
Coffee Shortage Percolating
A Nicaraguan worker picks coffee beans at a plantation on the slopes of the Poas Volcano in Costa Rica.   (AP Photo/Kent Gilbert)

A smaller coffee crop in Brazil could lead to a worldwide shortage in 2009-2010, Bloomberg reports. And the news is already affecting prices: Arabica beans, the kind used by Starbucks, jumped yesterday after a Brazilian official warned of a 22% drop in output. Other countries can't make up for "such a big fall of up to 10 million bags from Brazil," a trade group rep said.

Two factors are expected to contribute to the shortage, which would come on the heels of a surplus this year. Coffee trees in Brazil, the world's largest producer, are on a two-year growing cycle, and the slow half of that cycle is coming up. Another issue is the high price of fertilizer. Other top growers are Vietnam and Colombia. (More coffee stories.)

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