patrick.net

Hard to get exposure. The best way to play it is to buy commodities directly. On the London stock exchange, there is a good ETF that is composed of cotton, wheat, coffee, corn, sugar etc... It's a little late to join the party though. I wouldn't recommend buying any commodity stocks right this minute.

thanks oakman. is it late in a sense of its a bubble, or something else? Because we invest long term, so short term isn't that important.

ChrisLA says

thanks oakman. is it late in a sense of its a bubble, or something else? Because we invest long term, so short term isn’t that important.

When commodities spike up, they can spike down just as hard. For agricultural commodities, its easy for farmers to shift production to ramp up supply and bring prices back down. That's why they say the best medicine for high prices are high prices themselves. With commodities spiking, you run the risk of catching them on the downswing. Since these things can overcorrect violently to the downside, it's usually better to wait for that to happen and buy into it. This is what happened in oil in late 2008 and early 2009. Long term, coffee will probably go up. But I would wait for a major sell off before jumping into any commodities that have doubled over the past year.

Personally, I favor an Emeryville company called Peet’s (PEET) for coffee choice.
For a while after the crash, they seemed to be the only stock I owned that was not underwater. I haven't looked at a shareholder report lately, but I know they used to hedge like crazy.

Edit: From their 2009 annual report (PDF):
We currently use fixed price purchase commitments, but in the past have used and may potentially in the future use coffee futures and coffee futures options to manage coffee supply and price risk.

Thanks for all the advice guys.