Saturday, March 12, 2005

Tony Dejak / Associated Press Procter & Gamble Co. on Friday increased the retail price of its Folgers ground coffee by 12 percent because of sustained increases in the commodity cost of green coffee beans.

P&G raises prices for Folgers coffee

Associated Press

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CINCINNATI -- Procter & Gamble Co. on Friday increased the list price to retailers of its Folgers ground coffee by 12 percent because of sustained increases in the cost of green coffee beans.

One analyst expected rivals would follow suit. Consumer products companies generally have been feeling the squeeze of rising commodity prices.

P&G said Friday that it raised the list price of Folgers ground coffee by 28 cents per 11.5-ounce equivalent and 13-ounce equivalent, from $2.28 to $2.56.

Also effective on Friday were increases of 28 cents per 12-ounce equivalent of Folgers whole bean coffee, 10 cents per 8-ounce equivalent of Folgers instant coffee and 30 cents per 14- to 18-count bag of Home Cafe.

The increases follow P&G's announcement Dec. 9 of a 14 percent price increase for its Folgers roast and ground coffee, the biggest rise in a decade.

Telephone messages requesting comment were left with Kraft Foods Inc., which sells Maxwell House coffee, and Nestle USA Inc., marketer of Nescafe.

Jason Gere, an analyst with A.G. Edwards & Sons Inc. in New York, said he wasn't surprised P&G increased the Folgers prices.

"The green coffee costs have just been rising. This is certainly an opportunity for P&G, with price increases, trying to offset its costs," Gere said. "They announced this and I'm sure their competitors will do the same. They're taking the pricing just to cover their costs."

P&G shares fell 11 cents to $53.16 in afternoon trading on the New York Stock Exchange. P&G shares have traded in a 52-week range of $50.53 to $57.40.