Marcelo Teixeira of Reuters reports that U.S. coffee stocks are at a historically low level since importers have been avoiding high inventories to reduce storage costs during a period of high interest rates. That situation makes the port problems worse. Teixeira writes:
The unloading of hundreds of containers with imported coffee beans at the United States’ East Coast ports has stopped due to the strike of port workers, aggravating the tight supply in the largest coffee-drinking nation.
The delays in delivery of imported coffee to U.S. roasters and coffee chains could further increase bean prices which hit multi-year highs last week due to limited supply, and raise costs for companies and consumers.
Prices for coffee held in U.S. warehouses are already rising due to the delays, said one coffee trader with containers stuck in ports.[…]
Industry participants believe, however, that the labor issue could be quickly solved because the magnitude of the problem demands attention.
“We source coffee from 35 different countries. If this (strike) goes on for a long time, everybody will be impacted,” said Will Ford, president of operations at Arkansas-based Westrock Coffee Company.
Read more here.
