Starbucks purchased its first coffee farm on Tuesday. According to FOX Business News, it will help it develop and test new "innovative blends" of coffee in Costa Rica.
"The 240-hectare farm, located on the slopes of the Poas Volcano, will be transformed into a global agronomy center that Starbucks said will influence the development of coffee varietals based on the insight offered through soil management processes," FOX Business News reported,
Bloomberg TV posted a video about the coffee farm. The video reported the new farm would be used to create new coffee variety. It will be testing ways, to fight a fungal disease that has been a problem for the coffee industry.
Market Watch also posted a video regarding the new business venture. WSJ Reporter Julie Jargon explains, "This farm is in Costa Rice and one of the reasons they show chose its location has a broad range of elevation. This will allow the company to test different growing methods at varying altitudes. Some coffee does better at higher elevation; some coffee does better at lower elevation. This will give them a wide range of elevation to test out different growing techniques."
Starbucks is also trying to find a way to get rid of coffee rust.
"Coffee rust is a fungal disease and its wrecking havoc on the coffee crop in Latin America. This was a problem for different countries in the 19th century and it has become a bigger problem in Latin America recently. The fungus infects the coffee tree leaf and it causes the leaves to wither and fall off."
Starbucks is going to try different methods on this crop, to see if they can find a solution to the problem. Jargon also explained consumers might see an increase in coffee prices, however Starbucks said they secured enough coffee beans for this season and next. If the issue continues and the supply decreases; consumers could see an increase in prices. In the future, the coffee giant might purchase other farms.
The Starbucks stock is currently $56.20 per share. This is a .73-cent decrease from yesterday's closing price.
