This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Starbucks: Coffee Prices Will Come Down

(Starbucks and coffee prices report updated with clarification about John Culver's remarks.)
SEATTLE ( TheStreet) -- Starbucks (SBUX - Get Report) has already contracted its coffee purchases for the remainder of fiscal 2011, locking in its costs, as the commodity trades near decades-long highs.

Coffee futures hit a three-decade high of $3.0615 per pound on May 3 but have come down somewhat from that price in recent trading sessions. The commodity most recently settled at $2.7495 per pound on Friday.


In December CEO Howard Schultz called the 50% spike in coffee futures "tragic," blaming financial speculators for the run-up in prices.

John Culver, president of Starbucks Coffee International, said "we think that these prices are not based on facts given there is no supply problem," according to reports in Swiss newspaper Tages-Anzeiger published Friday. "Speculators are at work here."

"We do believe, however, that prices are going to fall again. For this year, we have suspended our coffee buys for the moment but we watch the market closely," he said

According to a Starbucks spokesman, Culver's remarks were mistranslated somewhat.

Culver's point, according to the spokesman, was that Starbucks had already locked in its coffee costs for 2011, and had already contracted to buy the main ingredient needed for its coffee operations, not that it had actually suspended purchases.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
GMCR $113.55 -3.50%
SBUX $95.08 -0.72%
SJM $114.48 -0.14%
THI $37.05 -0.25%
AAPL $124.24 0.70%

Markets

DOW 17,678.23 -40.31 -0.23%
S&P 500 2,056.15 -4.90 -0.24%
NASDAQ 4,863.3620 -13.1570 -0.27%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs