Kraft cuts U.S. coffee prices by six percent

On the heels of food giant Smuckers announcement it would reduce prices of its coffee products, Kraft Foods said this week it will also lower coffee prices in the U.S. by roughly six percent, The Associated Press reports.

Kraft said this week the price reduction will affect a number of its brands, including Maxwell House and Yuban. However, prices for its Gevalia, Tassimo and Maxwell House International lines will remain unchanged.

The price cut is significant, and amounts to roughly a 20 cent drop per pound on roast and ground coffees, and about 2 cents per ounce on instant coffees, according to The AP.

Coffee prices, along with those of nearly every other commodity, have shot up over the past two years, as global demand has rapidly outpaced worldwide stockpiles. Many companies - Kraft included - have raised coffee prices over the past year, and consumer advocates are hailing the recent declines.

"We evaluate the various market factors and make our pricing decisions when we feel it's appropriate for the business," Kraft spokeswoman Brdget MacConnell said in a statement.

With coffee prices starting to edge down, other companies are projected to follow Smuckers and Kraft in reducing coffee prices, experts assert.