BANGALORE (Reuters) - Top U.S. packaged coffee maker J M Smucker Co (SJM.N) cut coffee prices by 6 percent for most of its brands including Folgers, on the back of a decline in the cost of green coffee, in a move that puts pressure on its rivals to follow suit.
Smucker, which is considered a trend-setter for coffee prices, becomes the first company to cut back after a 15-month long period in which coffee companies across the board passed on record high costs to shoppers.
The price cut comes after Arabica futures in New York -- which had at one point more than doubled -- fell by nearly 20 percent since touching 34-year highs in early May.
With U.S. shoppers facing high fuel costs and food prices amid recent talk of a the possibility of a “double-dip” recession, Smucker’s move will pressure rivals such as Kraft’s KFT.N Maxwell House to cut their prices.
Shares of Smucker, which reports its first-quarter earnings on Thursday, closed at $75.91 on Monday on the New York Stock Exchange.
Reporting by Mihir Dalal in Bangalore; Editing by Viraj Nair