C-market price for Arabica coffee under one dollar a pound
Sustainability is a broad word and an ongoing thing. Few coffees are fully sustainable in every aspect, but with a focus on sustainability, we can step by step make things better. One thing we, as a buyer, can impact the most is the payment for the producer. We can pay more for coffee. This is an ongoing process as a steady working model for both parties, but it is not overpricing or charity. However, as a green coffee buyer, there are situations where I chose not to buy a tasty coffee because 1) we, as a fairly small buyer, can't change the working model if 2) the payment is to low for the farmer and we can't impact.
As you have heard, the market price for coffee been down below one dollar (0,97 USD), something that has not happened since August 2006. One dollar a pound is less than the production costs for almost every producer in the world. I am primarily thinking about the smallholder farmers who grow the majority of the world’s coffee. Farms that have a debt the producers cannot pay. On our travels in coffee producing countries, we see producers who don't make a profit or breaking the production cost. If farmers are not making money, we will not have any coffee.
To buy coffee for a dollar a pound is not a speciality coffee. Because the market price is a dollar, it doesn't mean you only have to pay that little for the coffee. What you pay is your call and there are often ways of paying more, otherwise don't buy at all.
Since the 90’s the C-market price has dropped under a dollar a few times, for the longest for about 161 days. The coffee prices have not raised since the 70's, still, the production cost has gone up and the costs of living have gone up. Producers today are not making enough money. Not even near. There is a lot of politics and national support that can be made for a more sustainable business for the producers, but what we can do every day is to use our customer power.
We all need to pay more so the producer can get more. Full stop. No matter if that is me buying coffee at origin, or you standing at the supermarket considering buying a coffee. It is your responsibility what you buy and what you consume.
I am not saying all of the coffee should be high-end speciality coffee, there is a market for all coffee, but whatever coffee we buy we need to buy it thoughtful of the payment for the producers. No matter what roast style or origin you prefer as how you drink your coffee.
Coffee is the main income for most producers, the only for some. There is no such a thing as a free refill. None is working for free. The price per cup of coffee is often a tenth of the price for the wine you buy per cup. Still, the same amount of work and investment is done.
The C-market price has been down and turned before and I am convinced it will go up again. This doesn't make it less true for the many producers who are suffering badly from the impact of it right now. The current C-market price means that the producers will not make any money on the coffee they produced this year. Some need to sell their farms. For us, this is a tuff reminder of how extremely important it is to pay well for the coffee to the producer.
By supporting high-quality coffee, as this help some producers from the hard commodity pricing model. For Drop Coffee, the C-market price will not impact the price we are paying to the producer, as those are not reliant on the C-market price, but based on production cost for the coffee and quality in the cup. As for many speciality coffee buyers. A speciality coffee buying model builds on relationships, fixed payments, premiums and quality of the cop and the C-market price for people in the speciality coffee market can be irrelevant, if we are doing it right.
We are only a tiny scratch of the market, this is beyond Drop Coffee and that I want everyone to support our work. I have promised to take my responsibility for what coffee we buy, and there are thousands of good roasteries doing the same. I do not care where you buy your coffee as long as you make sure to pay more for the coffee. I am asking you to remind your friends, family and colleagues to bear in mind the price for the producer. There is no free refill or coffee included. About a third of the coffee produced in Sweden gets poured down in the sink! Coffee cannot be produced for free, and we need to pay more if we want to enjoy it.
To all of us, and to everyone we know, pay more for coffee. None can work for those low prices and as a consumer, we have to pay for it. Otherwise, we will not have any coffee.
I have attached a screenshot of today's market price, just above 1 USD. Nowhere in Sweden could someone do that much work for that little money, nor anywhere else in the world. Step up and just make sure you pay.
Joanna Alm,
CEO
Drop Coffee'
