While world coffee prices remain somewhat volatile, we have seen further leveling out in some markets.  Coffee pricing in some of the leading coffee producing countries has stabilized for now.  We have passed along further cost reductions in reduced pricing for our customers on many of our gourmet coffees and flavored coffees.  As the markets change, our pricing will reflect changes while we attempt to offer the lowest cost for our high quality coffee products.

An example of price effects on retail coffee is Colombian arabica coffee.  The 2010 Colombian arabica crop export volume is down 38 percent.  Couple this with increased demand for arabica coffee, especially from third world countries, and a severe shortage relative to demand exists.  Due to poor weather conditions in Colombia, 2010 offered the lowest output seen in the last 22 years.  This has led to an increase of just under 40 percent for green Colombian coffee beans.

On the bright side, we continue to see some stabilization and the current Colombian arabica bean crop appears more promising.