Beans on the boil as arabica soars

Former BHP Billiton boss Marius Kloppers shoved the eye-watering cost of Perth's takeaway coffee into headlines a couple of years ago when he complained about the $5.50 he had to pay.

There looks to be little reprieve in sight, with arabica coffee extending its bull run to post the biggest gain in more than nine years.

With drought gripping Brazil, the world's biggest grower and exporter, world supplies are dwindling as rival growers in India struggle to fill the void.

Coffee has jumped about 20 per cent in the past month, heading for the strongest start to a year since 1997.

Arabica, which is grown mainly in Latin America, is favoured by many coffee chains, including the behemoth Starbucks.

It is a far cry from 2013, when coffee fell 23 per cent after massive crops in Brazil and Colombia.

The Brazilian drought has dragged up prices of robusta beans, which are grown in Vietnam and used in instant coffee.

Robusta futures for May delivery climbed 3.4 per cent to $1839 a tonne yesterday in London, after touching $1856.