Starbucks (NASDAQ: SBUX) has stopped buying coffee? Wha--aat?
Before you panic, girlfriend, let us assure you that no one is here to take away your double-caff, extra hot, no foam, skinny cappuccino.
Recent media reports are saying that the friendly neighbourhood java joint has ceased buying coffee until prices drop. Back in January, Starbucks reported that the high prices were going to cut into the company's profitability, but it wouldn't pass the costs onto North American customers just yet.
Last week, John Culver, president of Starbucks Coffee International was reported as saying, "We do believe, however, that prices are going to fall again. For this year, we have locked our coffee costs but we watch the market closely."
Locking in coffee costs does not mean a coffee lockdown. This does not - we repeat - does not mean that Starbucks won't be buying any more coffee to serve you this year. What it means is that Starbucks has ensured a stable price for their beans, fixing a price with their suppliers for the duration of 2011.
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