JM Smucker Cuts Coffee Prices 6

ORVILLE, OH -- J.M. Smucker Co. announced on July 1 that it decreased the list price by 6% for the majority of its packaged coffee products sold in the United States. The move follows sustained declines in the green coffee futures market.

Smucker's brands include Folgers and Dunkin' Donuts. The price decrease also applies to the new reduced canister size of Folgers ground coffee; the company's single-serve K-Cups were excluded from the price decrease. The Dunkin' Donuts brand is licensed Smucker for packaged coffee products sold in retail channels, but not Dunkin' Donuts restaurants.

Smucker is the biggest U.S. roaster and the nation's first to cut prices after a customer backlash following a 9 % price hike just over a year ago, when arabica prices were soaring. Last year's hike was brought about by a drought in Brazil, the world's biggest producer, which caused green coffee costs to soar. Kraft Foods followed with a 10% price hike for Maxwell House and Yuban roast and ground brands.

Smucker's termed last year's price increase a "misstep" after sales volumes dropped as customers switched to cheaper brands and delayed purchases. Coffee industry analysts are saying that Smucker's price decrease will be an industry trendsetter that likely will trigger price cuts by other major roasters.