Since the end of January, coffee futures have jumped from around $1.20 a pound to trade near $2.16 a pound on Wednesday for July futures. Coffee prices have not been this high in more than two years.

The most recent leap came after coffee trader Volcafe cut its forecast for the size of the Brazilian crop due to severe drought. The trader estimates that production of arabica beans will drop by 18%. Brazil is the world’s largest supplier of arabica beans.

Including the lower grade robusta beans, world coffee production this year is expected to be short of demand by 11 million 132-pound bags. That is more than 725,000 tons. And that is a deficit equal to all the production of Colombia, the world-s second largest producer of arabica beans.

If history is any guide, coffee purveyors like Starbucks Corp. (NASDAQ: SBUX) and Dunkin’ Brands Group Inc. (NASDAQ: DNKN) will hold off on prices increases for a while. At some point they will apologize profusely and raise their prices. Then, when the commodity price of coffee falls as it will certainly do, the coffee shops will not drop their prices.

The same is true of pod maker Keurig Green Mountain Inc. (NASDAQ: GMCR) and J.M. Smucker Co. (NYSE: SJM), which markets Folgers brand coffee, the best-selling U.S. coffee. They too will wait to see how long and how steep the rise will be before they boost prices.

By the look of things, all these companies will be forced to lift prices in order to protect profits. The only question is how soon. Our guess is that McDonald’s Corp. (NYSE: MCD) will be first. Earlier this month the company was giving away free coffee to attract customers to its new breakfast menu, but with rising commodity prices the company cannot afford to wait too long to raise prices. Its profits are already under severe pressure.

None of these stocks were active in the premarket Wednesday morning.

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