Yesterday I got a link sent to me by a good friend and coffee enthusiast in San Francisco. The link is to an Internet forum called Home Barista that is basically a discussion forum for coffee enthusiasts from around the world. I was a bit surprised to read this post on a forum created by and for coffee lovers, so I felt I had to reply in order to educate our customers and also to try to explain that not all coffee companies are the same.

Transparency

A lot of high quality driven roasters, including ourselves, preach that transparency is the most important part of our trade, but rarely do we actually get to see the numbers in the coffee industry. Sustainable Harvest is one of the few companies that are trying to do something about this through their Relationship Information Tracking System.

Cup of Excellence is also a great example of where consumers can get full traceability of the coffee trade.

I have been trying to establish a traceability system of our own and also to develop a contract that shows what the farmer gets when we pay USD 3 pr. lb (453g) FOB for coffee. We do have the contracts in Kenya as this is cooperative coffees created by hundreds of farmers. For all the other coffees we have bought this year we feel we don’t need it as we are communicating directly with the farmers anyway. We are still far away from being 100% transparent but hopefully in the future we will be able to get a system for it that enables our customers to get all the info they need.

As a temporary solution I have started to systemize all the information about our coffee purchases from the end of last year, and to my surprise we are actually paying a higher average price for our coffee than I thought we were.

Coffee prices

For the past months we have read that the C market price for coffee is at it’s highest in over 10 years at about USD 1,6 pr. lb. (453 g) of green coffee.

Although this is not a very high price for coffee it is still very positive that it is going up, as the price has been way too low for the last 10 years, forcing a lot of producers to start growing other cash crops in order to survive.

As you all probably know, we do not trade coffee based on the C market price and we do not sign future contracts based upon today’s prices like most of the bigger roasteries do. We buy the coffee direct from exporters or farmers and negotiate the price based on taste and quality. We negotiate with the farmer and the exporter. Not with a broker. We also have gentlemen’s agreements with farmers that if they continue their work with quality, we will be there to support them by buying their coffees.

As promised, I will try to do an effort for transparency, so here are the prices in USD pr. lb that we have payed for our coffees FOB  (free on board) in 2010:

Panama, Hacienda la Esmeralda:______ 26,50 $ + packing

Honduras, Cielito Lindo 2010 COE:_____  8,10 + packing

El Salvador, Las Palmas 2010 COE:_____ 5,31 + packing

Honduras, Naciemento:______________  3,50

Honduras, Finca El Pantanal:___________3,00

Guatemala, Santa Ana:_______________ 3,50

Kenya, Mugaga:_____________________ 4,77

Kenya, Tekangu:____________________  5,23

Of course these lots are not the same size. The Esmeralda was only about 120kg for instance. So the average price per lb. so far this year is actually USD 5,06.

Adding to the cost

As you may know, this is just for the green coffee. We also need to  pay for the shipping and handling of the coffee before it gets to our roastery. Shipping cost can vary greatly depending on the origin of the coffee. The price of the coffee gets about 25 to 30 % higher for the coffee when we include these costs. On average this means the price for the coffee when it has arrived to Norway is about USD 6,58 pr.lb.

We also need to cover our travel expenses that we spend when we travel around the world to find these coffees and visit the producers.

So far this year I have been to Kenya and Honduras, and I am going to Brazil next week, to Colombia in October and visiting Kenya again in November. That adds up to 60 days of traveling and a cost around NOK 120.000,- or about USD 20.200,- only for 2010.

My accountant may think I am crazy spending so much on traveling, but I think it is totally necessary and a good investment for the future. We are building relationships with serious farmers and we are trying to secure a good supply of great coffees in the future. We want to develop long term relationships with the farmers, not have one night stands with them.

After the coffee has arrived to Norway we still need to roast it, so you have to add the  cost of production, rent needs to be payed as well as salaries, delivery truck, electricity, maintenance, etc, etc. Of course the cost of living is higher in Norway than in Colombia and therefore we need to add a bigger margin to the coffee than a farmer in a producing country needs in order to make a living. For example, a beer in Colombia is about 1 USD. In Norway a beer in a bar is about 10 USD.

Is coffee expensive?

Some people think our coffees are expensive, and I understand that they believe so, especially if they compare us to a coffee sold in a supermarket. But if you taste the difference and understand how much work and effort is behind these coffees, I still believe that our coffees are cheap. It all boils down to about NOK 5,- or about USD 0,9 pr. cup. Compare that to what you pay for a bottle of water here in Norway (USD 5) where we have plenty of super clean water free from the tap, I think there is no need to discuss whether coffee is expensive or not.

Why is some coffees worth more than others?

Because quality of the coffee varies. Not only from farm to farm but within the same farm we can sometimes find a huge range of different qualities and varietals.

Take Cielito Lindo and Naciemento for instance. These 2 farms are neighbouring farms run by father and son. They grow coffee from 1500 to 1800 masl. in 2 very different types of soil. They grow 5 different Arabica varietals (Pacas, Catuai, Catimor, Geisha and Bourbon) These trees produce (like all other fruit trees) both very mature coffee cherries and also unripe and cherries that fall to the ground and get mouldy and rotten. Of course this will produce coffee of different quality.

Next year we will be there during their harvest in order to help them separate the different varietals. We are going to taste the coffees blind and  score them according to the COE cupping form. We will pay more for the better tasting lots and less for the lots that get lower scores. Would we do this if there wasn’t a difference? I think not. So, why do we do this? Because we want to encourage the farmers (above: Jobneel and Extreberto) to grow more of the qualities we like so that we can get more of this coffee in future years.

Simple and easy.

Why pay more for coffee?

Well, I see it as an investment. The farmers are able to invest in necessary equipment in order to raise the quality and they are able to save a little money and make a decent living. If we treat them well today, they will treat us well tomorrow.

I  believe that we cannot continue to exploit the coffee producers. Sooner or later they will stop producing coffee and that is a scenario I would not like to see. So, if you love coffee and would like to continue to be able to appreciate its wonderful flavours and diversity, then choose quality coffee before cheap quantity coffee.

I also think all roasters need to practice transparency in a greater way. It is time we practice what we preach so that more people understand what we are all about.

Hopefully this post was of some help to clarify what we are doing and trying to do in the coffee world. I could go on and on writing about this, but instead I encourage you to leave comments in our comments section and I will make sure I reply as soon as I can.

The total amount of money we managed to raise for the Tekangu drying table project is USD 4600,-

Hopefully this will be enough to build 5 tables.

Tim Varney and I will be going to Kenya in November to oversee the harvest and also to document the benefits of using these new drying tables.

A huge thank you to all our customers who contributed. It is much appreciated.

We have some exiting new coffees for sale this week.
After a lot of waiting, both the Kenyan coffees we sourced in January are for sale. Also an exciting sweet bourbon from Finca Santa Ana, Guatemala is ready for sale.

There is also a new TW espresso blend that is quite different from the last 3 blends we have had. The new blend is very potent with a lot of fruity flavours and winey acidity.

For more info, go to our resource page and click on “our coffees” in the left menu.

Hope you like it.

We will start roasting and selling our new crop Tekangu from Kenya on Tuesday the 6th of July.
More info on the coffee here.

We just bought the 30th place winning coffee at the 2010 El Salvador Cup of Excellence auction.

You might wonder why we didn’t bid on the delicious 1st place winner or the lovely no. 3. Well, we are looking for a slightly different profile from El Salvador. Although I love the Pacamara they produce, I feel that we are able to source similar styled coffes from Honduras, only with more intensity. However,  I love the super sweet and dense Bourbon coffees from El Salvador.

The lot we bought is just the style we are looking for. The coffee is super sweet, juicy and has a lovely marzipan aroma with berries and plum in the background.
We bought this lot for USD 5.31 per lb (453 grams.) That is more than USD 4,- above fair trade price.
We are planning on using it for espresso as we think this style of coffee will be super sweet pouring from our FB80.

Hopefully it will arrive in about 6-8 weeks.

After a long flight over the Icelandic volcano and spending an unwanted day in Panama waiting for my flight to Honduras, I finally made it to San Pedro Sula, 36 hours behind schedule. Nevertheless, my plan to visit Cielito Lindo was not affected, and I have to admit that I was very excited but also a bit afraid that my expectations were too high before my visit to the farm we have bought coffee from twice at the Cup of Excellence auction. I guess that not being able to communicate directly with the farmer and also hoping that he would be the “perfect farmer” was making this visit extra exciting and nerve wrecking for me.

Afer a 2 hour drive from San Pedro Sula, I finally met with Mr. Extreberto’s son who kindly showed me around his farm and then his father’s farm. I have to say that not only is their coffee beautiful, but it is grown in one of the most beautiful farms I have ever been to. The landscape is breathtaking and really impressive. I spent over 4 hours walking from 1500 m.a.sl. to 1800 m.a.sl. struggeling to get both up and down because of the extremely steep hills. I can only imagine how hard it must be carrying a lot of coffee on your shoulders walking up and down these hills, and Mr. Extreberto does it every day at the age of 71.  To be honest, I was exhausted after the first 100 meters, but the beautiful scenery just made me want to see more.

Well, enough of the romantic rant. To my surprise they were still picking coffee on the farm. The climate has been changing in Honduras during the past years, and we are starting to see a similar situation to what Kenya and Colombia is having with 2 harvests per year. At Cielito Lindo they start picking coffee in november and they finish in may. That is a very long harvest and by the looks of it they are going to have a tiny harvest in late august as well, due to some rains that occured some months ago.

Another interesting thing is that they grow a lot of different varieties, and have competed in the Cup of Excellence with great results both with their Catuaí and their Catimor varietals. Up until now they have normally been blending these 2 varietals, but I suggested that they separate the varietals next year, so that we will be able to taste them side by side. They also grow some Bourbon and Pacas and are looking in to other varietals too. The biggest issue with separating these varietals from each other is not during the picking, but the lack of drying space makes it difficult not to mix them up. They need to invest in new solar dryers (raised drying beds) as they have very limited drying space. Hopefully we will be able to help them invest in this by purchasing some more of their coffee this year.

I have asked for some samples of their harvest, and apart from the coffee they have delivered for the Cup of Excellence it looks like they will have 20 more bags for us to buy if the quality is satisfying. So I am very happy that we have the opportunity to continue buying coffee from Mr. Extreberto and his son, and hopefully we will see more of their coffees in the future.

Well, that was a short report from a very interesting day. I am absolutely beat after a long day at the farm and a 5 hour drive from Cielito Lindo to Santa Rosa, Copan, where I will be staying for 2 days cupping coffee and visiting some other farmers. On monday th Cup of Excellence is on, and I can’t wait to taste all those coffees.

More pictures below.

We have roasted the wonderful San Antonio from Guatemala as espresso, to replace the Finca La Milagrosa as our single origin espresso. The San Antonio is currently a small percentage of the Tim Wendelboe Espresso blend, but is now available all by itself.

As an espresso, it has deep flavours of forrest berries, orange zest and cocoa. Firm, red wine acidity with cocoa sweetness. A rich mouthfeel and delicate tannins in the finish. More information on the coffee can be found here. And it can be purchased from our webshop.

Oda from Kaffemisjonen in Bergen, used it for her 2010 back to back Norwegian Barista Championship win over the weekend.

We are finally starting to sell the coffee we found on our Brazil trip a couple of months ago.

Fazenda Santa Barbara is the name of the farm producing this wonderful coffee. You can find more info here.

We have finally started roasting our last 2009 Cup of excellence coffee from Guatemala.

For more info about the coffee go here.

We now have a new espresso blend for sale in the store.

It consists of:

55 % Suaza, Huila, Colombia. Wet processed.
35 % Fazenda Primavera, Brazil. Wet processed.
10 % San Antonio, Guatemala CoE. Wet processed.

Go here to read more about it.