It is going to cost you more to make your next pot of coffee. Retail coffee prices are going up by 9-10%.
Kraft (KRFT) hiked its prices on its Maxwell House and Yuban ground coffee brands by 10% over the weekend.
This follows a similar move by J.M. Smucker (SJM) last week, which increased its prices on its retail brands of Folgers, Dunkin’ Donuts packaged coffee products by 9%. It was the first time the company raised prices in three years.
So why are consumers being asked to pony up more money for their favorite coffee brands?
The price of Arabica beans is up 55% this year, due in part to the worst drought Brazil has seen in 50 years. Food companies paid a two-year high about $2.15 a pound in mid-April. Now, those food companies are passing those costs on to consumers.
And the price increases are turning up at local supermarkets. According to the April consumer price index released by the Bureau of Labor Statics, coffee prices have risen for two straight months.
However, coffee is not the only item on your breakfast table getting pricier. Eggs, bacon and milk prices are also on the rise. A gallon of fortified whole milk set you back $3.69 in April. That’s up 7.5% from a year earlier. A dozen large Grade A eggs will cost you $2.12, an increase of 10.4% from a year ago. And bacon is averaging $5.69 a pound, up more than 16% from a year ago.
Yahoo Finance Editor-in-Chief Aaron Task said these price increases are enough that they are going to affect consumer spending habits.
The Labor Department releases its Consumer Price Index for May next week.
Today’s poll question: Are you going to cut back on your cup of joe because of higher coffee prices? Vote in our poll, or leave a comment below or on Twitter.