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Category: Coffee
The Cost of Coffee
Those involved in the coffee trade over the past 2 years and have seen gyrations to the coffee price that were previously inconceivable. The worldwide supply of coffee has reduced due to damage from late frosts in Brazil in May 2020 combined with the covid difficulties in productivity and shipping. Brazil who are the world’s largest coffee producer, at 2.4m tonnes, has more impact on coffee price and supply that any other producer.
The net effect of this is a reduction in available supply of coffee for export and accordingly a steady and continuous rise in green bean coffee prices. In July 2019 the traded price for arabica green beans was USD$2.99 per kg, this had increased to USD$5.84 by February 2022. For those of us in the coffee importing countries, this is a significant price increase which makes us look at our own businesses and decide what we need to do to stay competitive while offering our customers an attractive proposition.
But before we blame climate change and covid for our woes, it’s worth looking at this from the coffee producing nations’ perspective. Up until 2019, there was an oversupply of green bean coffee (primarily from Brazil). As a result, the price of coffee was steadily falling; in economic terms, coffee is considered to have ‘inelastic demand’ (as the price of green bean coffee drops this does not lead to similar increases in demand) but the price is hugely influenced by the amount of supply. The reasons for the steady price decrease occurred due to the rapid rise in production capacity (in Brazil), slower growth in coffee consumption (most people don’t drink more coffee because it’s cheaper), excess power by the major coffee roasters and a depreciation of the Brazilian Real against the US Dollar.
The net effect of this was calamitous for smaller producing countries (Kenya, Uganda, Rwanda, Honduras, Columbia etc) who are almost always in the developing world and are hugely dependent on exporting green bean coffee to fund the basic running of their countries. For the farmers themselves, this resulted in communities adopting ‘coping strategies’ that include reducing the maintenance on coffee plants, reduced expenditure on health, education and so on. The governments of coffee producing countries did try and club together to set up minimum price per kg but these have largely been unsuccessful due to the temptation to break ranks.
So in May 2020, the Brazilian coffee crop has a fright, the challenge of Covid put pressure on previously efficient supply channels and the western coffee drinking world had to stop and rethink their strategy. Smaller coffee producing counties come back into focus as the prices look reasonable. At Watermark we are no different, we launched our Tibradden single origin blend from Kenya at the beginning of the year and the coffee has been a great addition to our Woodland Coffee range.
Who knows what will happen over the next few years but what has happened recently to the price of coffee probably reflects an inherent fairness. The price increases seen of recent times merely reflects a more equitable situation whereby growers are getting a better deal.
Increasing footfall in a coffee business
With more and more new cafes opening, the challenge for a lot of cafes is how to hold on to and attract customers in the door. While there is no single panacea; it’s an accumulation of doing a lot right that keeps people coming back and talking about your coffee business. When all is said and done, the personal recommendation is key whether by word of mouth or on-line in getting customers coming through the door. While this is not a definitive list of suggestions, hopefully it might get you thinking about some of the solutions that might work for your situation.
Quality is key
Having amazing coffee and coffee equipment will unfortunately not guarantee amazing coffee. Coffee grinder calibration, coffee machine cleaning and barista skill all play a pivotal role and these need to be monitored closely. The best way I find is to taste the coffee every day to check that it is tasting the way I need it to. I find that that this requires a little more that taking a coffee ‘on the run’ but more a ‘sit down’ and concentrate on what flavours are coming through.
Try and personalise your business.
Your business is very likely very personal to you as mine is to me. Given the volume of customers that come through your door every day, It can be difficult to give all your customers a personalised experience that feels genuine but if you can start with one customer at a time, it builds up fast. Rather than talking at your customers, try and get them to talk to you. Sometimes this is as simple as asking them – ‘How are you?’ Whatever approach you think works for you, give it a go and see the reaction!
Be easily found
Claim your business on Google, Yelp and Trip Advisor. Listing your coffee shop’s ‘Business Profile’ correctly in Google is a great way to ensure people searching for a café or restaurant p in your area can quickly find out all they want to know, via Google Search or Google Maps. Claiming your business is free. Make sure that you complete every section of your profile, including opening hours, your address, phone number and a link to your website if you have one.
Asking for feedback and reviews
Increasing the number of reviews on google, trip advisor and yelp is a really great way of increasing your relevance on Google. Getting people to leave a review can be difficult as people are busy. Just remember most people want to say something positive. Try and respond to all reviews even the ones you’re not happy with.
Have something interesting to engage your customers with.
Over the past year, many of our Woodland Coffee customers have been telling their customers how many trees have been planted and the expected CO2 that is expected to be sequestered from the coffee sales at their café. Usually this is as simple as putting it on a chalk board. This is a really great way of getting a message across that is specific to the café and their customers.
If you would like to find out more about Woodland Coffee or how we can help, please drop us email oninfo@watermark.ieor call us on 01 4666304.
What is happening in global coffee markets?
It’s been a year of turmoil on international coffee markets. The price of green bean coffee has steadily increased month on month since the start of the year pushing up prices by 43%. So what’s behind these increases?
Damage to the Brazilian coffee crop
Brazil is the largest producer of greenbean coffee amounting to 44% of the worldwide supply (and equates to 22,400 60kg bags). Rainfall in Brazil has been significantly less during the year causing drought which weakens coffee trees and reduces their productivity in terms of quantity and quality. In addition to drought, there were a series of late frosts during the summer which caused additional damage to the growing trees as temperatures were on average half what they should have been. Many farmers were left with a damaged crop as well as the need to ‘stump’ their trees or replant them altogether. Yet another timely reminder of the fragility of our ecosystem and the impact that small changes in weather can have on food production.
Pandemic supply chain bottlenecks
A global confusion in container freight is adding the difficulty in getting supply from coffee producers in Vietnam to foreign markets. Vietnam predominately produces robusta coffee which is not used for our speciality grade coffee but a shortage of supply from one market tends to push up demand for other suppliers and hence more upward price pressure. Hopefully as the global supply chain return to normal over the coming months this particular challenge will dissipate.
Coffee Consumption
In case you didn’t know it already, we’re drinking more coffee. Coffee consumption has increased year on year and this year it’s expected that demand will outstrip supply by 1.4m tonnes. The effect of steady increasing demand with the uncertainty around the Brazilian coffee crop in 2022 and 2023 its sending upward pressure on the coffee futures price
The Coffee Bean Journey
Coffee is one of the World’s most traded commodities. Coffee production, farming and processing are continually advancing with a continual focus on improving the quality of the coffee green beans. The increasing sophistication in consumer demand requires that coffee bean production incorporates the nuanced flavours of their ‘terroir’ into the cup.
The coffee beans that we encounter are largely divided between two varietals, Robusta beans and Arabica beans. Robusta coffee plants are grown at lower altitude and are more resilient to frost and disease but their flavours are less complex and subtle than Arabica beans. Robusta beans have a stronger flavour with more caffeine and are typically used in instant coffee. Arabica beans are grown at higher altitudes in mountainous areas and tend to be what is used for speciality coffee and accounts for approximately 60% of the world’s production.
A coffee tree takes between 3 and 5 years for it to mature and produce coffee cherries. Like most plants, the coffee tree flowers and when pollinated, produces the cherry. The coffee cherry is allowed to ripen on the tree and picked when it turns red. The ripe cherries are processed which involves drying and sorting. Key factors influencing flavour at this stage are the drying methods used, whether natural or mechanical, humidity, stirring, airflow and the avoidance of additional water. Even the surface on which the coffee is dried can impact the final flavour.
Once dried the coffee beans (known as green beans) are graded by Q graders and packed and sent on their merry way around the world for blending and roasting. The reason why they tend not to be roasted in the country of origin is to allow for further blending to achieve a particular taste profile and also to ensure that the coffee does not unduly deteriorate during transport as a result of oxidation which greatly impacts the taste of the coffee during brewing.
All of our coffees are 100% high grade speciality Arabica coffee beans to give a range of flavours to suit your offering. We are always experimenting with new blends to give our range the extra edge, like to find out more? Drop us a line on info@watermark.ieor call us on 01 4666304.
#coffee #specialitycoffee #watermarkcoffee
Coffee and Sport
With the Olympics starting in a few weeks time, coffee is the drink of choice for many athletes; here are some of the reasons why:
Coffee burns fat and boosts energy
The high levels of caffeine in coffee significantly improve the ability to burn fat during exercise by increasing fat oxidation and metabolism. Once caffeine enters the bloodstream, the body responds in several ways. Blood pressure and heart rate increase, fat stores are broken down, and fatty acids are released into the bloodstream. As a result many people feel energised and ready for exercise.
Coffee Enhances Athletic Performance
“Caffeine is effective for enhancing various types of performance when consumed in low-to-moderate doses,” according to a position stand from the International Society of Sports Nutrition. Caffeine enables an athlete to train longer and with greater power output. Caffeine was also shown to improve endurance levels and resistance to fatigue.
Endurance athletes appear to benefit greatly from coffee. Coffee stimulates the body to burn fat instead of muscle glycogen (sugar), during long workouts. This allows for prolonged use of working muscles.
Coffee Promotes Better Concentration
Coffee and caffeine have been shown to improve mental focus. Caffeine is a natural stimulant that can improve brain function and have a positive impact on the areas of the brain responsible for memory and concentration. When thinking is sharp, workouts and exercise become more productive and effective.
Coffee Reduces Muscle Pain
Based on studies carried out in the US, drinking a cup of coffee prior to exercise may help those who suffer from ‘stitch’ caused by the build up of lactic acid in muscles. Participants who consumed coffee prior to a work out reported less muscle pain and better performance during the final set of repetitions.
Coffee Helps Fight Disease
Coffee contains powerful antioxidants shown to reduce our risk of disease. Antioxidants work by removing free radicals that cause inflammation in the body resulting in illnesses and diseases. According to research published in the Academy of Nutrition and Dietetics, “coffee provides one of the greatest sources of antioxidants in the American diet.”
Inject some summer feeling with an Iced Caramel Latte!
Variety is the spice of life, as my mother used to say when we were young; along with phrases like ‘there are more fish in the sea’ (which never really helped, sorry Mum!). But adding an extra dimension to the beverage menu is a simple and easy way to improve customer engagement at the counter as well as on social media. Iced coffee is unlikely to replace the popularity of regular Americano or Latte but it definitely appeals to the younger customer base.
We have teamed up with a New Zealand Company called Shott that produces a range of ‘super premium’ fruit and spice syrups using only natural ingredients with no added sugars, colouring or flavouring. The result is a syrup that oozes bold natural flavours and does not have that synthetic taste that other highly processed sugared syrups have.
The great news is that there is an abundance of recipe ideas that you can tailor to your own situation that suits your set up and customers. For starters, let’s look at an Iced Caramel Latte, it real simple. Just mix 20ml of Shott Caramel, 200ml of full cream milk, 30 ml of espresso coffee and ice. Garnish with some caramel and Voila!
There are hundreds of recipe ideas to choose from and each come with simple instruction in terms of the recommended serving suggestion or you can simply come up with a few of your own signature ideas. The Shott website has lots of inspiration to get you going and we can also send you some recipe booklets by email, just let us know.
A Summer Outside
Coffee from horseboxes is a new phenomenon of living with lockdown. Given the surge in demand for coffee machines going into horseboxes there is apparently plenty of demand from the public to support these local entrepreneurs that see and seize their opportunity. For those with existing businesses and premises that may be operating at reduced capacity or are currently closed, there is a great opportunity to adapt the offering and increase revenue into the business.
Coffee is a great ‘horsebox’ product because it’s easy to handle, low preparation, attractive margin and customers don’t necessarily need to take a seat or table. For existing businesses with reputation, power, water, refrigeration all close to hand an adaptation of the business model should be reasonably straight forward. Whether it’s moving an existing coffee machine and running it off a pumped water bottle system or putting in a smaller 1 or 2 group machines like the Gaggia Ruby, there are plenty of options that can boost your revenues; who knows it might become a permanent feature of your business once lockdown eases!
It’s worth checking out to see if your business qualifies for an ‘outdoor dining grant’ which is being administered through Failte Ireland to help businesses adjust to the new operating environment.
If you would like to find out more about what coffee equipment might be most suitable, please give us a call or drop us a line, we’d love to hear from you.
#outdoordining #coffeetogo #summer2021 #supportlocal