Coffee Commodities and Starbucks

If we look at commodity trading from a purely conceptual standpoint, we find that the true reason for having a commodity exchange in the first place, was to stabilize pricing so that the American farmer could have a better idea of what his agricultural product would sell for once the harvest was complete. It also helped manufactures who needed raw materials to know how much money could be charged in their end product, by knowing their costs.

If we look at the Colombian coffee market we see some interesting things develop. Starbucks has bought up half of the plantations there. While Starbucks was buying coffee previously, those plantation owners made lots of money, now Starbucks owns the plantations and therefore is running them differently. And not buying coffee from the other plantations, therefore the coffee prices have been lowered throughout the country, causing a Terrible plight on the people. Yet, if those plantation owners been sold their properties to Starbucks, had never sold them in a first place, then they would still be making lots of money from Starbucks.

Starbucks job is to return shareholder value to its owners and that means operating very efficiently, that means pain as little as possible to wholesale coffee growers. It was able to do this by buying out the plantations and doing it themselves. Of course there is a different culture in Columbia and a large coffee plantations also cared for the workers. That is not the way a modern-day American corporation works. The plantation owners are very upset, those in still remain owners, who have not sold out because there is nowhere to sell their coffee, for the high price they previously sold to Starbucks. However one must also consider, that before Starbucks the coffee plantations made just average profits. When Starbucks came along, their profits when up temporarily, until five years later Starbucks bought their own plantations, and not just in Columbia, all over the world. Someday, coffee means will be less of a commodity then they are today, because Starbucks will own over 50 percent of all the coffee plantations.

Coffee plantations do not produce a lot of harvest until their many years old. Starbucks is controlling that commodity by owning 23 percent of the commodity. Whenever they don't use, they sell for a higher price than the original coffee plantations were selling for. Some might complain about this strategy, however if they are using mostly coffee are retail level and selling the rest then they are free to do that. The only real problem with this, is bad messes with the entire supply chain, in this case it heard the people, the hard-working people of Columbia. Think about the macro and micro economics of coffee commodities next time you sip on your Starbucks Coffee.

"Lance Winslow" - If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/wttbbs

---

Coffee, Caffeine & Fitness

One look at a line at the local Starbucks in... Read More

Campfire Coffee Recipes

Want to know a few secrets to making a good... Read More

La Minita Coffee ? It?s in the Green Beans

La Minita; Spanish for "The Little Gold Mine" says it... Read More

History of Instant Coffee

Mention instant coffee to any connoisseur and you are sure... Read More

Italian Roast Coffee For An Authentic Espresso

One of the things people think of with Italy is... Read More

Coffee Bean Roaster

The coffee bean roaster is fast becoming a "must have"... Read More

Coffee Roasting: Learning the Fundamental Art of Making Coffee Can be Fun

Coffee roasting from light to very dark, is an art... Read More

Choosing A Coffee Maker - Tips On Finding The Right Features

Choosing a good coffee maker is not a decision to... Read More

Is Caffeine a Hero or a Villain in Your Life?

Many sober, law abiding people who would never dream of... Read More

Does Coffee Make You Fat or Help with Diabetes?

Who the heck knows?According to two studies published in the... Read More

Mr. Coffee Versus Bunn-o-Matic - The Coffee Maker Battle Heats Up

For coffee lovers, there are few things more appealing than... Read More

The History Of Coffee

Coffee - THE Drink of ChoiceDid you know coffee is... Read More

Coffee and Depression: Coffee as an Antidepressant?

When you grab that morning cup of java, you're probably... Read More

More Tips on Getting the Best Coffee Maker

It's unbelievable, but when you start your search for a... Read More

6 Delicious Coffee Recipes

Do you love coffee? Most of us do. In this... Read More

Make the Switch! Coffee to Tea

Having a hard time giving up your 4 cups of... Read More

Make Money In Your Own Coffee Business

A 2001 survey by the National Coffee Association indicated that... Read More

Getting Fat These Days; Is it Starbucks

Starbucks has seen tremendous growth in our cities and the... Read More

Coffee and Health

From the year dot, my mother taught all her children... Read More

Russian Tea drinking - The beginning

It is believed history of Russian tea drinking tradition have... Read More

Those Elusive Coffee Beans!

With the spread of various coffee beans into our lives,... Read More

The Coffee Culture in the USA

It wasn't until I moved to the US that I... Read More

Coffee from Guatemala

In Guatemala coffee grows in the heart of what was... Read More

History of the Coffee and Espresso Machine

A large percentage of the population loves to drink both... Read More

Starbucks Coffee Company

Starbucks Coffee Company was founded in 1971 by three businessmen... Read More

A Little Secret Your Dentist Doesnt Want You To Know

Most dentist, particular those who specialize in cosmetic dentistry love... Read More

What Makes Hawaiian Coffee So Special?

Coffee was first introduced to the Islands by Chief Boki,... Read More

Specialty Gourmet Coffee

Specialty gourmet coffee is a very hot commodity in today's... Read More

Fresh Gourmet Coffee

Coffee is one of the most popular beverages in the... Read More

Portrait of a Barista

The barista is the Italian word for the skilled person... Read More

Coffee Club Membership Is A Joy For Coffee Lovers

Coffee club membership is a joy for coffee lovers The... Read More

Live the Life of a Civil War Soldier When you Drink your Mornin Coffee

Civil War soldiers, Confederate and Union, used to... Read More

Mocha Coffee: Learn About the Source and Try Our Recipes for Making Great Mochas

Depending on how we look at it, mocha coffee may... Read More