The dynamic nature of the global coffee commodity market directly impacts
decisions made by procurement specialists such as Jim. Price changes and production quantities have historically been extremely volatile and can be heavily
influenced by factors such as inclement climactic conditions, trade policies of
producing nations, and various consumer/producer preferences. As Figure 1
demonstrates, retail roasted coffee prices were dramatically low during the early
1980s and early 1990s (USDA/FAS 1999 and 2003). According to Figure 1, price is
negatively correlated with world coffee stocks, supporting the expectation that price
is directly affected by supply.