Price Premium for High-End Coffee Reaches Highest Since 2016
- Continued dry weather in Brazil feeding bean-quality concerns
- Cotton futures also surged in tandem with soaring commodities
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The premium for high-end coffee over cheaper beans surged to the highest since 2016, driven by concern that dry conditions could worsen the outlook for the drought-stricken crop in Brazil.
Futures for arabica coffee, the type used at cafes such as Starbucks Corp. and Peet’s Coffee & Tea Inc., rose Friday to the highest since late February, posting a third straight weekly gain. The spread or premium that arabica commands over the robusta variety, widely used to make instant-coffee beverages, climbed to 74.27 cents a pound, the highest since November 2016.