The 2020 Specialty Coffee Transaction Guide has been released, collating information on green coffee prices and buying from the 81 data donors involved in the project.
It lists US$2.60 per pound as the median middle free-on-board price paid for specialty coffee in coffee year 2019/2020.
This is down 15 US cents from the 2018/2019 coffee year, which the guide suggests was caused by a move from higher-quality, more expensive coffees towards higher-volume and lower-scoring specialty coffees.
Within the 25th percentile (lowest quarter of prices) the median was US$1.90 per pound, inline with the year prior.
In the 75th percentile (highest quarter of prices) the median was $3.50 per pound, six US cents down on 2018/2019.
The transaction guide says another key takeaway is that, in each harvest year, the range of prices paid for green specialty coffees is quite large. In 2019/2020, 50 per cent of the prices in the sample covered a range of US$1.60 – from US$1.90 to US$3.50.
When it comes to quality, in 2019/2020, the median price for coffees in the 86-87.9 range was US$3.50 per pound, 84 per cent higher than the median price for 82-83.9 coffees, at US$1.90 per pound.
For lower-quality coffees, the lower prices declined in 2018/2019, but then rebounded in 2019/2020. The 25th percentile price for 82-83.9 coffees fell 18 US cents, from US$1.52 in 2017/2018 to US$1.34 in 2018/2019, before rising 25 US cents to US$1.59 in 2019/2020.
Another factor influencing prices was lot size, with smaller lots and quantities earning higher prices per pound. In 2019/2020, the median price per pound for lots of less than 1000 pounds, U$4, was more than double that paid for lots of more than 40,000 pounds, US$1.90.
The Specialty Coffee Transaction was designed to provide specialty coffee roasters and importers with a “more relevant” information source than commodity indices to use as part of their independent pricing strategies. The guide estimates that roughly 6 per cent of specialty coffee produced over the last three harvest years is included in the 2020 Transaction Guide.
Australian companies involved in the 2020 Specialty Coffee Transaction Guide include Campos Coffee, Condesa Co Lab, Five Senses Coffee, Melbourne Coffee Merchants, Rumble Coffee Roasters, Seven Seeds, and Upstream Coffee Imports.
Matt Slater, Director of Coffee for Five Senses, says the transaction guide encourages greater communication between buyers and seller, drives transparency, and fosters a greater level of openness and trust in the coffee industry.
“Green coffee prices have historically been determined by commodity price references. In most cases, these prices do not cover the full cost of production and go nowhere near what is needed to support the livelihoods of coffee farmers and their families,” Matt says.
“The Transaction Guide… is a move away from using the current commodity price as a starting point for price discovery and allows an informed discussion around the true ‘value’ of a coffee, taking into account variables such as quality and lot size.”
For more information, visit www.transactionguide.coffee, Five Senses’ blog post HERE, or Melbourne Coffee Merchants’ HERE.