2022 was a year of historically high green coffee pricing, based on a large rise in the commodity price of coffee beginning in 2021. For a small margin wholesale and retail coffee company, these prices aren't easy to absorb and we need to be smart in how we both pay high prices for great lots of coffees from producers we love and want to earn living wages; and find value in coffees we source and roast for our blends to try keep our own business afloat and sustainable:
Big Picture Takeaways
Bluebeard paid an average of $4.17 on 40,900 lbs of coffee purchased in 2022, up 59 cents per lb from 2021 numbers and 85 cents from 2020 numbers. For perspective, coffee's commodity price (C Market) began 2022 at $2.35 per lb (it began 2021 at $1.24 per lb) and maintained a similar range through September of 2022, dropping south of $2 in October and ending the year at $1.81 per lb.
The Commodity C Market price of coffee is considered to be an average pound of Arabica coffee in Brazil, the largest producer of coffee in the world, now followed closely by Vietnam. Clearly, Bluebeard is paying a precipitously higher price for access to great coffees, even in a historically priced market. Why? In short, we want consistent access to the best product from the hard working people who deserve to live and prosper from the crops they produce so well.
Bluebeard is proud of these coffees, growers, source partners and our role in their continued sustainability. The value of these people and their exceptional coffees is reflected in our significant investment in their livelihoods.
Importantly, our listed price is the Ex-Warehouse (EXW) price, paid for from the point of entry warehouse in the US. You may also see Free on Board (FOB) price, the price of the coffee when delivered to the boat at the port of origin and ready to ship. As EXW covers nearly the entirety of our contracts and purchases, we utilize it. It's useful in understanding the full cost of a coffee once in lands at its port of consumption, it can tell you less about precisely how a farmer was paid. We recommend Red Fox's super informative series on Paying for Coffee: It's Complicated.
* Note that OLAM Coffee Group rebranded as Covoya Coffee in 2022.
The manner in which our partners at source have remunerated farmers is a fascinating and complex subject, which we won't begin to address here, save to pass along that it varies widely and necessarily by country, community, processor/coop/community/farmer, and stage at which coffee is purchased, whether it be cherry, parchment, bagged and ready for export, etc.
Should you seek it, we would invite you to dive into the web sites of our import partners, who embody many best-in-industry practices in coffee, paying at the top of the market to farmers and communities in the interests of sustainability, living wages, sound environmental practices and value paid throughout the coffee chain.
Thank you,
Kevin McGlocklin
Bluebeard Coffee Roasters