“Retailers will ultimately pass along their cost when it goes up, and then when things come down, they'll pass it back down but a little bit more slowly to make up for that difference.”
This quote reveals a potentially contentious aspect of retail pricing, suggesting that while cost increases are passed on, decreases are often delayed, leading to higher profit margins for retailers.
Vox
“A rough rule of thumb for the cost of milk is 50% to the farmer, about 20% to the person processing and packaging it, and about 30% might go to the food retailer.”
This provides a detailed breakdown of how revenue for a common consumer good is distributed across the supply chain, highlighting the complex economics of everyday purchases.
Vox
“The only thing I'm surprised about is that prices haven't gone much, much higher, much faster.”
This provocative statement suggests that current market prices may not fully reflect the true magnitude of global supply disruptions, hinting at potential future volatility.
Vox
“Why does the market react so much faster to bad news than it does to good news?”
This question highlights a fundamental, often frustrating, asymmetry in market behavior, provoking thought on market psychology and efficiency.
Vox
“The broader understanding is that the coffee prices won't go back to where they were before all of this started.”
This quote suggests a potentially permanent shift in pricing for everyday goods, signaling a new economic normal for consumers and businesses.
Vox
“The Boogie man is ultimately the climate. Coffee is one of those crops that is sensitive to weather both in terms of rainfall and temperature.”
It powerfully attributes rising coffee prices to climate change, highlighting how environmental factors directly impact agricultural commodities and global supply chains.
Vox