(GLOBALPOST) Coffee prices have topped $3 a pound for the first time in more than 34 years.
A drop in supplies of high-grade arabica coffee beans and a growing taste for upmarket coffee among the middle classes of China, Brazil, Indonesia and India are blamed for the sharp rise.
Continuing weakness in the dollar has also kept many commodity markets soaring and encouraged a buy-up of arabica beans.
New York's July arabica contract hit $3.025 a pound on Wednesday, the highest since 1977. According to the Guardian, coffee futures inched lower to $2.94 on Thursday.
Coffee prices have more than doubled in the past seven months. Supplies are running low because heavy rain led to worse than expected harvests in Colombia, the second-largest producer of arabica beans after Brazil and also in Indonesia, Mexico and Vietnam. Colombia's supplies dipped to their lowest level in 33 years.
The London-based International Coffee Organization added that coffee inventories - at their lowest level in 50 years - were unlikely to build up this year, the Financial Times reported.
Price hikes are reportedly being felt in American coffee shops.
JM Smucker, the U.S. company behind the Folgers coffee brand, has raised retail prices three times during the past year. The company has warned it will do so again if wholesale prices do not fall soon, the FT reported.
Tammy Durbin, co-owner of Capitol Roasters in Charlestown, W.Va., told the Charlestown Daily Mail that her coffee prices had jumped by 80 percent since June.
"That's a big jump," she reportedly said, adding that the price of a 12-ounce cup of coffee at Capitol Roasters had gone up 10 cents -- to $1.49 -- in the past few days.
"It's tough," she said. "Everything seems to be going up. It's just hard on our customers in general."
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