Coffee Prices Explode & Global Coffee Gratitude

At the end of the Thanksgiving holiday, I am reminded of how grateful I am for coffee. Not only for its rich, soothing, energizing effects---but also because of its health benefits, including a reduced risk of diabetes, stroke, Parkinson’s disease, and depression. I am also grateful that increasingly the medical evidence is documenting these benefits with amazing contributions from European and American universities!

I am also grateful that most of the coffee-drinkers I know can still afford to drink coffee and enjoy its benefits. That is not insignificant, especially when you consider that coffee prices are at an all-time high for the past 13 years. In fact, coffee futures have increased 44%. According to pundits, a constellation of factors are contributing to coffee's sky-high prices, including bad weather in South America and low stockpiles in the United States. But, there's something else: Increasing demand from coffee drinkers in emerging economies. The largest increase in demand is coming from the burgeoning middle classes in China, India, and Brazil, which will soon become the largest consumer of coffee outpacing the United States. Increased wealth and ambition is indeed leading to a desire for the taste of coffee and the myriad social and physical benefits that accompany its consumption.

The net effect of all of these factors has been increased prices, especially among value-brand coffees, such as Maxwell House and Folgers--a 10% increase so far. There has also been an increase in the cost of brews served at independent coffee houses and Starbucks is considering increasing its prices, though they have been fairly restrained about doing so. Note, however, that we are still drinking coffee at a healthy clip. If you grab your coffee from a local kiosk in any city, it is likely that the kiosk owner is trying not to increase the cost of your coffee.

Plus, when you're talking about increases of 10 or 15 cents per cup, you're still well within the confines of an extremely inelastic demand curve. People who regularly consume coffee are just not going to step away from the coffee-counter over a 15-cent increase. However, experts suggest that people may very well start drinking lower-priced, lower-quality coffees.

I have discovered a new value brand! IKEA's Braggkaffe Mellanrost direct from Sweden, available at IKEA or online. At a cost of $5.99 for 0.25 kg, this UTZ-certified organic coffee, which is 100% Arabica and boasts a slightly sour, yet rich, taste is a really good buy. In fact, Sweden has the unique distinction of being the number-one coffee-consuming nation in the world. Per capita consumption is 10 kilos per person. That's a lot of coffee for 8 million people. I bet they're grateful for coffee. I certainly am. Drink up and be healthy!

Coffee: The Great Equalizer That Reduces the Risk of Stroke

The connection between coffee and the brain is taken for granted. Coffee is a major stimulant that speeds up reaction time and improves short-term memory, primarily by acting on the prefrontal cortex. But coffee’s effect on the brain goes beyond caffeine-induced stimulation. In fact, there is one brain-related benefit associated with all types of coffee---caffeinated, decaf, instant, or ground coffee. Regular coffee-drinking reduces the risk of having a stroke by about 27%. Researchers think that this is because of the antioxidants in coffee (the #1 source of antioxidants in the American diet), which can lower inflammation and improve blood vessel function.

In a 12-year observational study led by Dr. Yangmei Li at the University of Cambridge in England, the coffee drinking habits of more than 23,000 men and women (aged 39 to 79) were tracked. Coffee drinkers fared much better than non-coffee-drinkers when it came to stroke---the leading cause of disability and the 3rd leading cause of death in the United States, according to the National Stroke Association (NSA). By definition, a stroke is life-limiting and disabling. It is essentially “a brain attack” in which blood flow and oxygen to the brain is cut off due to a clot or sometimes due to bleeding in the brain. During a stroke, 2 million brain cells die every minute.

In 2010, there were almost 800,000 strokes and more than 135,000 stroke-related deaths un the US. The NSA recommends maintaining a healthy blood pressure, not smoking, drinking alcohol in moderation, exercising, and controlling cholesterol levels as preventive measures. Stroke prevention comes down to lifestyle---and based on the data from this study, coffee drinking is another positive lifestyle measure.

Another interesting aspect of this study that was very surprising is that all coffee drinkers enjoyed the advantage of a reduced risk of stroke regardless of their age, gender, ethnicity, social class, physical activity level, or smoking or alcohol consumption status. How democratic…Maybe coffee can help level the playing field in terms of accruing health benefits. One more reason to make drinking coffee a major public health initiative!