Keurig said that the price hike was in “direct response” to the higher cost of coffee which has risen close to 55% in “green coffee prices.” The company takes pride in buying mostly coffee from organic and free trade producers.
Coffee prices have gone up a whopping 58% over the last 12 months following a drought that dried up the harvest of Arabica beans in Brazil this year. Keurig is following companies such as J.M. Smucker (SJM) and Kraft (KRFT) in raising coffee prices over the last couple of months.
GMCR stock is up about 0.45% Thursday morning. SJM stock is up 0.45% and KRFT stock is up 0.1%.
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