For those of you buying or selling green coffee right now, I’m sure you’ve noticed it is a bit of a roller coaster. Low yield in Vietnam has lead to unsatisfied buyers pushing into the Central supply. These buyers are soaking up a good deal of spot coffee leaving considerably less options for anyone that was not already secured in futures. The lessons learned through Mercon are fresh in the mind of every green-house in the business and that has made them all extra cautious, again limiting the options of the buyer. We see most-all small to medium sized trading houses relying on pre-sales before booking container loads as they are still a bit long from last years imports. This creates a spot market of past-crop to nearly-past-crop coffees leaving a tired taste for those not in the position to commit forward. So, if you are planing an exquisite and smoothly transitioning single origin program, prepare to be disrupted.
If you’re simply looking for broad flavors scoring in the low 80’s then you will probably be covered however, it always stings a little when you fix in a coffee with the market floating well above $2/lb. The medium-to-large traders are building in padded differentials not knowing what way the market will swing. This causes a fatigued buyer to surrender to the simple fact that we will all be paying a little more money for a little less this year.
We are all still cautious on Brazil as fears of frost echo over the wire. Some of the fresh crops from Ethiopia start to trickle in delayed like everything else. But, they are delicious. With the market in such flux everyone is buying spot and buying short hoping that the market will level off again in their favor. These are the times when relationships and long term planning can help to secure supply and, at least, allow financial forecasting. Best of luck to you as we navigate these choppy waters.
Written by Jake Leonti, F+B Therapy
Mr. Leonti has worked in coffee for over twenty years with disciplines at every link of the value chain from barista to roasting, green grading and importing. Jake is a columnist at Santé Magazine, member of the Roasters Guild and host of the Food and Beverage Therapy podcast
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