Coffee YouTuber James Hoffman makes a pretty convincing argument that we are living in the golden age of coffee. Lots of excellent coffee and it’s pretty affordable. But he thinks it could end soon.
Everybody knows that climate change could be a problem, but he says an even bigger problem is urbanization. The average coffee farmer’s age is 50-something and their kids don’t want to take over the farm, they want to move to the city. The people who are willing to work the farms, want to be paid a lot more, so there’s upward pressure on prices.
Right now cafes can charge $4-$6 for a coffee drink and people seem to be willing to pay it. As coffee gets more expensive, how many people are willing to pay $6-$8? For a lot of cafes, it won’t take much of a drop in business to kill them.
> The average coffee farmer’s age is 50-something and their kids don’t want to take over the farm, they want to move to the city. The people who are willing to work the farms, want to be paid a lot more, so there’s upward pressure on prices.
Good. Farmers are criminally under-paid when people doing nothing productive in the economy are getting paid for their annoyances. It is time the system gets a reset.
The cost of coffee beans in a standard espresso drink is ~25 cents, and that's if you are brewing ultra high-end $15-20/lbs beans. Raising the price of the beans by 15% or 30% or even 50% isn't going to make all that much difference to margins when the end product retails for $4-6 or more.
The coffee shop business is only tangentially related to coffee. Whether you will be successful or not depends more on location, labor, branding, interior decor, music, bakery, food, upsells..
Might want to check your math there. At $20/lb, zero waste (!!), 18g of coffee is $0.80/shot. Add in 10-15% waste (accurately predicting exact supply of beans is almost impossible, plus dialing in, mistakes, and training) and a more standard 22g basket, you get $1.12 per drink.
Aiming for 25% COGS, that pushes up the price of a cup to $4.50 before milk, syrups, cups, etc. If the cost of coffee doubled, you'd be looking at the cost of coffee only being 38% COGS for a $6 drink. That kind of increase is not only going to completely remove all margins, but likely put you in the red per drink served.
Those are some far fetched numbers, that's the price of premium/specialty coffee and the amount is easily a double shot, even triple by Italian standards.
Common commercial beans are ~$24/kg at retail prices, and while 14g would be a double shot around here, let's assume that's a "single shot" since standards seem to differ a lot. That puts us at a much more reasonable $0.39 per "shot" of coffee after accounting for 15% waste.
On a personal note, I would actively choose to pay $0.40 more for coffee if I knew that the money went back to the farmers who produce it.
There is no "standard 22g basket". Regular 8-12 oz drinks at most coffee shops have a single 7-10g shot. Double shots and larger sizes always cost more.
All espresso based drinks you will find will be double-based.
And especially any place which is doing specialty coffee is going to be using larger doses to make extraction more consistent with lighter roasted coffee (in the realm from 18g to 28g).
It's pretty normal nowadays to see 20g or 22g baskets used in specialty coffee shops.
You can obviously order a single but the price difference is just a trick, the other shot gets dumped unless two people order singles at the same time.
I have no idea what you are talking about. The world's largest coffee chain (Starbucks) uses a single 1 oz/7 g espresso shot in their short (8oz) And tall (12oz) drink sizes. To get two shots you have to upgrade to "grande" (16oz), or specifically ask for (and pay for) an extra shot. Most coffee shops do the same for their smaller drinks.
Starbucks does use singles in some Tall drinks (your point stands - Latte & Cappuccino), but not all (Americano & Flat Whites have 2 shots in a tall).
Meta: I've never seen anyone order a short, the only thing I've ever seen in those cups are espresso pulls or water (but it turns out a Short Flat White still has two shots - worth a look)
Starbucks makes coffee flavoured desert drinks. We are talking about specialty coffee shops. I've also never seen starbucks use a single shot basket to pour a single shot. They always just split, this is broadly the standard. Nobody outside of Italy is making single shots with a single shot basket.
Ask any coffee professional (someone who actually knows what they're doing).
Or just go walk around. Try to find a cafe which is using different portafilters with single spouts (an indication of a single shot basket). Or ask them. Buy a single espresso and watch what they do. You will never see them use a single shot basket or a single spouted portafilter. You will always see them split a double.
For #2:
Since nobody is using single shot baskets, and no reputable coffee shop is setting aside split shots to use in someone else's drink, the only time it would make sense to make a coffee from a single shot is if it would be too intense with a double (hard to imagine). The alternative is just wasting coffee in most cases except when you're lucky and your customers order drinks where you can use the other split shot. But I don't really see anyone splitting shots for milk drinks, maybe I've not paid enough attention as I don't drink them that often. Either way, you're still brewing a double shot.
You can again, just watch what they're doing. I've never seen a coffee shop where you can't see the bar and the machine. Just watch what happens.
Lastly, you can't dial in a single shot basket and a double shot basket at the same time, you need to have dedicated grinders dialled in for both. Nobody outside of Italy bothers with that. For specialty cafes you'd be doubling the number of dialled in grinders which would be especially impractical.
At least in Austria, this seems to be a recent phenomenon, and limited to "fancy" coffee places. I was surprised the first time I saw the barista throw away half the coffee when I ordered an espresso.
I don't have statistics, but I think that single spout portafilters are still common in traditional Austrian cafes. I agree that you can't perfectly dial in the grinder for both single and double shot, but only a minority of people care about James Hoffmann levels of perfection and outside of speciality coffee shops nobody drinks light roasts.
One curious thing I saw in a bar in Italy that their machine had a much smaller diameter portafilter, so they can make a 7g shot without these conical sieves.
Coffee is extremely finnicky and its really not as easy as you think to make even a passable shot when going between baskets with different doses. Even with an Italian dark roast.
This isn't about making amazing shots of light roast coffee, it's about the difference between an acidic and a bitter coffee. If your customers are buying and drinking straight espresso (also uncommon outside of Italy and some bordering countries) then they will notice and complain. Although I guess since most people in these regions drink singles, maybe cafes dial in for the single and just YOLO the double. I don't know much about how Italian cafes are ran as I am simply not into that style of coffee nor do I live in Italy. Outside of these regions where its common to drink straight espresso, most cafes just half ass the dialing in and if you ask for espresso its usually varying kinds of mediocre to trash. Regardless, nobody uses single baskets. In the specialty cafes where you can order a straight espresso and expect something decent to amazing, you also never see single baskets and single shots just result from a split with half of the shot wasted or in another concurrent customer's cup.
Regarding Austria, it seems like countries which border Italy also seem to often do single shots too. I didnt consider this but it also doesn't surprise me.
Regarding the portafilter, the industry has standardized on 58mm group heads in the commercial setting but there are still some smaller diameter machines out there which make pulling smaller shots much easier.
There are currently almost no new commercial machines in that format but its entirely possible it will change in the future.
I for one am considering buying an adapter for 49mm baskets so I can more easily extract good light roast espresso without needing the larger doses.
I know the struggle -- We have an espresso machine at home and would love to be a able to do both single & double shots, but I have never managed to find a setting that works for both, so it's dialled in to single shots. I figured that cafes maybe are better at finding a middle ground. There must be a reason why most grinders have two separate timers for single/double tap.
> you need to have dedicated grinders dialled in for both. Nobody outside of Italy bothers with that.
Huh? Most cafe's I see (Australia) the grinding is separate from the dispensing, and it is a single shot per pull. It's a big world out there mate, might be more of an isolated cultural thing than you realize or my neck of the woods is special. Either way, likely varies.
> Huh? Most cafe's I see (Australia) the grinding is separate from the dispensing, and it is a single shot per pull.
This is just not how espresso works.
You can dose the same grind into a double basket and a single basket and you will never get the same coffee out of both.
Maybe Australia is special but in Europe, the UK and America, except for Italy (and apparently some surrounding places) nobody is using single shot baskets.
This is jusg a well known fact in the coffee industry.
I don't carry around sources for well established industry wide facts which you can verify yourself by opening your eyes. Do you carry around a source that proves that using a keyboard to type is faster than using morse code?
James Hoffman (coffee professional, winner of WBC) discusses the obscurity of single dose baskets in his video here. He mentions they're not often used in the home because he is discussing home espresso but the 50 caveats of single dose baskets apply to the industry too.
Discussion of single baskets by The Wired Gourmet pointing out that in the industry double and triple baskets are used and split in vast preference to single shot baskets. Also covering the difficulty of working with single shot baskets:
The reason people in this section are disagreeing with me is because they have never made specialty espresso and have no idea how difficult it is to dial in a single basket, even if you're a cafe.
Again, this only takes basic experience in coffee/cafe drinks to understand this is true. The standard espresso based drinks are: espresso, cappuccino, latte, macchiato, cortado, flat white, americano, mocha, and a few other varieties. Every single one of those starts with a double shot of espresso (~1.5-2 fl oz of liquid). This is sometimes even referred to as a 'single shot' even though 1.5oz would put you in what is considered a double shot.
There may be some niche drinks that use less espresso liquid, but they're not common. If I was only given 0.8 fl oz (which, is what a single shot looks like) in an espresso drink I would be upset.
Yeah it's a general rule, there are some exceptions, but they're less common than is worth challenging this claim for. Some drinks would be too strong to be made from a double, these will use a split single in countries where doubles are the norm. The second shot will end up wasted unless someone else is ordering the same exact drink or ordering a single espresso (also rare outside of Italy and some other countries). I've seen it but most customers prefer to see bigger drinks these days so most cafes don't usually face this problem and make drinks from double shots.
For reference, I use a 36g shot (basically 36ml if you wait for the crema to dissipate) for a 170ml "flat white" at home. This achieves a balanced strength for this kind of drink. You really have to get into the tiny drink category before you really reach the realm of "this is too strong and I must use a split single". And, in those cases, due to the fact of the double shot (and, I would struggle to come up with "sources" but it's again generally accepted that unless you can use the second split shot for a drink immediately, it goes down the sink), you are still often using a double worth of coffee for a single shot drink.
lol this thread is amazing. Hacker news is truly a place filled with confidently wrong smart people. Showed this to my wife, a barista in Seattle, and she asked me why I go to this stupid fucking site. I wasn’t able to give a good answer other than boredom.
I mean if you think about it, almost nobody here is a Barista (home or commercial), but most people here are technical. People don't realise the complexity of coffee when they haven't actually tried making espresso so it's not too surprising that you get people who think they've figured it all out in their head. Same thing happens on this website with basically any niche technology (haha, I can't believe I am referring to brewing coffee as technology).
I just did my math (because I was curious, not out of doubt) and it came out to $0.33 per espresso -- $20 for a 2 pound bag of beans from the grocery store @ 15g per "double shot" using the stock basket that came with the machine.
True, I'm not using 'premium' beans and probably doing it wrong but it works for me. Add in 'natural spring water' and 6oz of chocolate milk and I doubt it gets over $0.75.
If you are paying $20 a lb for expresso beans you are probably not a coffee shop and definitely not buying the coffee that costs $6 at a chain coffee shop.
The standard size for a bag of coffee is 12oz, at least in the US. $20/lb is equivalent to $15/12oz. $15 for a 12oz bag of coffee is pretty standard for anything that isn't bottom rung these days. It's not even 'great' coffee at that price; I'm just talking about something mid-tier like Counter Culture coffee which is available nationwide.
Anything cheaper than that and you are firmly into the budget coffee tiers.
I think you are using a very narrow definition of "nice beans". At one pound per cup in bean cost, you are doing some coffee equivalent of having a glass from a £500 champagne bottle or listening to music from a pair of £10k speakers. Amazing for sure, but not a reasonable floor for defining "nice".
Normal premium beans are around €15 in a 450g bag over here, and I can't imagine they are all that much more expensive in the UK. If you buy in bulk, they will be a lot cheaper.
Yes at £20 per 350g I am paying slightly more than normal for "nice beans". But most places sell for no less than £10 per 250g of light roast. That's still 76p ($1) per shot.
The only things going for less are darker roasts, supermarket coffee and blends.
Pact isn't ultra high end. Its pretty middle (maybe a bit better) of the road as far as UK roasters go.
Ultra high end would be Gesha or something equivalent. Those often go for fun prices like £28 (and that is still on the low end) for a 150g bag in the UK. That's £3.50 for a 19g shot, and if I was buying Gesha I would probably get a triple precision basket or a step down basket because I would want the absolute best chance of extracting well if I'm spending that much.
My £1.10 shots are definitely above middle of the road. Maybe you can call them high end. But they're not ultra high end and a single shot of ultra high end is definitely a lot more than $.25 as the initial comment in this chain seems to claim.
I just want to chime back in and say that the post I replied to said "nice beans" at £1/cup and the post that was a reply to talked about the cost of beans for a "standard espresso".
My intended angle was to say that I think "nice beans" for a "standard espresso" starts lower than that, for the coffe-appreciating general public.
People like me, who thinks a Starbucks espresso is nothing special but decent enough. Anything better is nice beans! :-)
Coffee from Okinawa would probably be my pick for ultra high end. It sells for about $2 / gram (or 250g for $490). These producers don’t make much coffee each year and it sells out very fast.
I heard of that one, have never tried it. I've always wondered how much of that is just the fact that it's some tiny farm vs actually tasting unique.
I am spoiled for choice, I've modded my machine to be able to do electronically controlled pressure and flow profiles. I wouldn't even have a clue how to dial this in quickly enough to enjoy it (other than relying on Gagné's adaptive profile).
If/when I'm ever in Okinawa I might see if there's a local cafe which has already dialled it in and can brew it for me. I think that's probably the most cost effective way of trying this coffee.
250g bags are only 70% of the size of a 350g bag. Also, they don't seem to offer anything except blends.
Their actual more expensive coffee (which even then, it's unclear if this is a blend or not) is 14 pounds a bag, which... when you scale to 350g comes out to, unsurprisingly, about 20 pounds.
> Normal premium beans are around €15 in a 450g bag over here, and I can't imagine they are all that much more expensive in the UK. If you buy in bulk, they will be a lot cheaper.
Those are not premium beans, no offense. I agree, bulk pricing will be cheaper than retail, but premium bean pricing is still quite a bit more.
If you want the equivalent of 'having a glass of 500 euro champagne', you need to look appropriately upscale.
They sell a 250g of a natural Gesha coffee for 928 kr - or ~85 euros. That works out to ~6 euros per 18g of coffee if you were to serve this as an espresso. Most of the time, such coffee is used for pour overs, though.
Keeping it in a local context: Lidl sells coffe beans for 200kr/kg. That is pretty cheap coffe and they probably have very high margins on it.
Zoegas fairtrade beans are perhaps twice that price. That is premium coffe. (like Barilla is a premium pasta, Galbani makes premium mozarella, Alfa Romeo makes premium cars, Rotari prosecco is a premium sparkling wine).
If you go far beyond that, you are in high end territory. (Ferrari vs Alfa Romeo, champagne over prosecco). There is no limit to what you can spend to get the most unique flavour experiences.
And trying it back to the very root of this thread. A random, generic café that charges 8$ for a single shot espresso, does not need to do that because the cost of beans is killing them. The cost of beans is essentially nothing, unless you are a one-in-a-thousand speciality coffe house.
> If you go far beyond that, you are in high end territory. (Ferrari vs Alfa Romeo, champagne over prosecco). There is no limit to what you can spend to get the most unique flavour experiences.
I really don't agree with that. $20/kg of coffee is quite cheap, at least in the US. Maybe Sweden has wildly cheaper coffee prices, but I doubt that.
$20/kg equates to roughly $6.80 per 12oz, which is below the bottom end of coffee prices you can find in a store if you're buying 12oz bags.
A normal 'specialty' coffee costs at least $14/12oz (or, ~$40/kg). That coffee is nothing particularly extraordinary. In car analogies, that would be the equivalent of a low-end Lexus or Mercedes.
> Stepping to twice the price of the low-cost beans is my definition of premium. Like going from a 30k Fiat to a 60k Alfa Romeo.
Your definition of premium isn’t based in reality, though. It’s more equivalent to going from a $5000 motorcycle to a $10000 used car, to continue straining the car analogy.
If the $86/bag coffee is the equivalent of a Ferrari, then scaling down by the same amount would be your $60k car. Which would be like paying $14/bag (for 12 oz of coffee).
It's worth noting that while that's a fair comparison to the wine bottle, it's not necessarily true to say that either the bottle of wine or the Gesha coffee are inherently higher quality or more premium, they're just rarer or more expensive to produce and somewhat more novel than what a person would get most of the time. You can probably brew equally as satisfying and flavorful coffee by spending significantly less than half that rate, it just won't be as fancy feeling.
As someone who drinks quite a few of these incredibly weird coffees: I don’t agree. You can get some of the way there, but there are flavors and experiences that you won’t recreate with cheaper coffee.
There just is no way to get as clear of flavor separation and striking flavors as you can get with some highly specialized coffee. Gesha coffee is well known, but you can also spend a lot on expensive processing techniques such as fermented coffees.
As an example, there was a coffee I had for a period of time that tasted like cherries. Not just “hint of cherry”, I had multiple people tell me this coffee tasted like candy. Not coffee flavored cherry, just cherry. I’m currently drinking a coffee right now that tastes like red wine.
Can you get a lot of the way there? Absolutely. A nice Ethiopian coffee naturally processed can be half or a third of the price of a Gesha and still have lots of fruity flavors.
It’s true that some expensive coffee doesn’t live up to the hype much like expensive wine, but it’s unfair to say that the only thing expensive coffee is buying you is uniqueness.
> but it’s unfair to say that the only thing expensive coffee is buying you is uniqueness
I don't mean to be intentionally obtuse, but it does seem like you just described that what you get primarily is uniqueness or degrees of uniqueness.
What I was intending to say is that you can absolutely get within a negligible margin for far less than half the price of say, 85 euro per 250g, which is comically expensive, all equipment and other ingredients kept more or less the same in terms of investment. Not all fermented coffees run that high either, and a lot of the cost comes from rarer varietals that may or may not be unique, but just aren't inherently higher quality than high specialty grades of others. For example https://www.prototypecoffee.ca/shop/oxaofizuq8la2g7m9ercvtxv...
That's not to say they aren't worthwhile or in-appropriately priced novel occasional experiences, but in a similar fashion to what you said, there are various high-grade less expensive beans to be had from Ethiopia, Indonesia, Colombia, etc.. that can distinctly taste like watermelon, starburst, blueberry, cherry; they're still very expensive relative to even quite good blends from a local roaster, but they're not that high. Incidentally, if I wanted just cherry, actual cherries at their already high price would be wildly less expensive, but that's besides the point. Ultimately they're still subject to variation in brew consistency, palate, etc.. to the point that I'd prefer to get on average 98% of the way to the same cup with 1/2 the spend considering how likely it is that some of it won't turn out that great anyway, especially without a multi-thousand dollar grinder or custom recipe water.
The exception to my comments may depend on market too, I don't know how expensive some of the extremely fruity Indonesian beans may be in EU for example, or how much a Pink Bourbon might be in Aus.
For all of the best specialty coffee I've had, there's been at least one cup at the same price-point, same roaster, same cafe, that just wasn't anything amazing, and it's a silly amount of money to chase an occasional unique novelty as a regular thing imo. I'd rather have very good most of the time for much less than half as much.
> What I was intending to say is that you can absolutely get within a negligible margin for far less than half the price of say, 85 euro per 250g, which is comically expensive, all equipment and other ingredients kept more or less the same in terms of investment. Not all fermented coffees run that high either, and a lot of the cost comes from rarer varietals that may or may not be unique, but just aren't inherently higher quality than high specialty grades of others.
Fully agree. There's plenty of good coffee you can have that isn't stratopherically priced. That said, there's a certain price bracket where you just cannot get some of these flavors. Anyone buying $10/lb coffee will never get those flavors. If you want lightly roasted coffee with fruity or floral flavors, you have to spend a certain amount.
I'm not suggesting you have to spend the "$500 champagne" equivalent to get good coffee; I'm just saying that coffee isn't a percentage goodness thing. For certain types of coffee flavors, there isn't any way around spending money to get them. Certain flavors are a lot easier to achieve with lower cost coffee, though. Any sort of chocolate or nutty flavor is generally easier to achieve with cheaper coffee, so if that's what you like drinking... then you probably don't need to spend as much.
I think there would be magnifying effects, but possibly in the opposite direction.
If coffee becomes more expensive, buying a bag of coffee for your home and being terribly inefficient with doseages and such would not be so viable.
If coffee houses can maintain price relatively stable they become much more viable. Especially since the other cost factors can keep coffee consumption in check.
I've been able to buy a pound of high-quality whole bean coffee for $15-$20 for about 20 years now. I assumed the cost at cafes had more to do with labor and rent.
> Right now cafes can charge $4-$6 for a coffee drink and people seem to be willing to pay it. As coffee gets more expensive, how many people are willing to pay $6-$8? For a lot of cafes, it won’t take much of a drop in business to kill them.
Sure, but to drive an increase of that amount using coffee bean prices alone requires coffee beans to double in price.
The majority of that $6 coffee you are buying at a cafe is non-bean costs. IOW, of that $6 coffee, maybe $1 worth of beans are used.
(If, like me, you drink only black coffee with no sugar or milk or flavouring added, you will also experience the frustration of paying almost the same as everyone else who is buying some flavoured coffee)
Then we'd need the receipt to itemize all the things we got thanks to those taxes, like the roads the beans came in on, the traffic lights and road signs that allowed the trucks to deliver those beans safely, the clean water/air, the health inspections that make sure the backroom isn't totally rat/roach infested, the building codes that keep the roof from falling on us while we order, the schools that educated the employees, the power grid that keeps the lights on, the police that keep crime away, the Office of Weights and Measures and consumer protection laws which ensure we're getting what we paid for, etc.
That's my point, the data is obscured in such a way that all we see is an abstract price going up, but not how much of that price was directly or indirectly influenced by the cost of bureaucracy.
Permitting etc. is 0.5% to 2% of development costs, which is itself a small subset of what rent pays for, and only for the first 5-10 years.
This number would be $0 for most cups of coffee (made in paid-for buildings) and <$0.02 for pretty much all the remaining ones, I think?
Rent on the other hand is 15%+ for every cup of coffee in perpetuity (not counting second-order question of what % of wages go directly into residential rent).
Sorry I was actually making a less related comment than I initially indicated. I meant (loosely) indicating how much of new builds for things like developments in general go to bureaucracy or land, since in my city it seems like they heavily subsidize existing homeowners and have intensely increased in recent years, having the indirect effect of raising the floor and pulling up the ladder.
> Starbucks regularly charges $15 for coffee flavored drinks today.
Uh, where? Worst I've seen is the extra large Frappucino, which could be as much as $10 after tax and a generous tip. I struggle to see how you could get to $15 for a single drink.
If you buy regular coffee or a more basic non-milkshake drink, they're closer to $5.
Not a big deal. Coffee is not a necessity. The coffee monoculture is devastating for the environment. Most small coffee farmers and plantation workers don't earn a livable income. Only 10% of the retail price of coffee goes to farmers. The whole industry is exploitative.
It seems like there was lower coffee production so they hiked prices due to the more limited supply. It also seems like they hiked prices too high with suppliers saying that they've only sold 30% of their production when they'd normally have sold 100% by now.
It does kinda show how markets don't just magically hit an equilibrium price. The prices went up due to limited supply, but then the sellers couldn't sell at those higher prices. Negotiations over price aren't going fast and buyers are only buying what they can immediately use/sell.
> It does kinda show how markets don't just magically hit an equilibrium price.
Generally, markets do "magically" hit that.
Can you explain why, at the moment demand dried up at the higher price, the suppliers didn't immediately drop the price to meet demand? That's generally how these things work.
Unless there's some kind of cartel operation at play here. In which that's to blame, not the market.
Futures traders decided the price would go up 70%, and were very wrong. This led to the standard “C” contract (set by the ICE exchange) price being too high, tanking demand. If you want to participate in the futures market, you need to have a license you get from the exchange.
I’m sure some producers will try to bypass the exchange market that manages all that, but, ultimately, someone will have to lose a bunch of money. It’ll either be the traders (futures contracts end up being worthless) or the producers (coffee ends up rotting or being refused by the silo).
The article suggests it’s the latter, which makes me wonder how powerful the exchange is, and what happens if you just start freighting bags of coffee around.
I’m not an expert on agricultural commodity exchanges, but at least some (like the Chicago board of trade) look like a cartel from the outside. The cartel controls distribution, and squeezes the producers and the consumers.
If that’s happening here, that’d explain how we can be in a situation where the (1) retailers want to buy coffee, but can’t afford the newly hiked price, (2) the producers are sitting on unsold inventory that they can’t discount, and, simultaneously (3) there’s a glut of distribution capacity and things like silos are sitting empty and going bankrupt.
Whenever someone says the market doesn't work it's just because it's not doing what they think it should, as if there's some pre-ordained magical prices.
This is why no one should take capitalist true believers seriously.
It’s not an efficient (let alone moral) distribution system if one of its outcomes is spiraling prices that are irreflective of genuine market demand.
The whole problem highlighted here is that the people who want to sell cannot sell because the buyers don’t want to eat their consequences and man up to the loss on their gambling.
I'm curious to know from someone who understands better- isn't this the kind of volatility that futures markets are intended to prevent? If actual product movement has changed significantly then is it just that this moment is especially volatile, or are futures as a mechanism not particularly meant to deal with this?
Futures aren’t meant to do anything, are they? Like so much of the market, they are just another partial-information lottery which isn’t explicitly forbidden by weak regulators.
Futures market started as a way of (and in America were strictly limited to) prpducers and wholesale buyers to hedge/fix their costs.
Then American regulators started handing exceptions to allowable market participants out like candy and suddenly the markets are majoritarily financial middlemen who do not want to take delivery.
Futures markets make lots of sense and are very useful. How they are currently constituted does not.
> It does kinda show how markets don't just magically hit an equilibrium price.
There's lot of research on situations where market prices fail to work, but not much (as far as I'm aware) of when they largely work, but there are times when the market seizes up (and how to avoid such situations). or do the risk of such situations are so great that a product should not a be allowed to have a truly "free" market. e.g. petroleum.
it's difficult to impossible to believe that there is any failure currently in the international coffee market. (i'm replying as much to GP as to you, not disagreeing with you)
>markets don't just magically hit an equilibrium price
markets do magically, and quickly, hit a "market clearing price" where all the bids and asks that match are executed. the market can also slow when there are plenty of bids and asks but they are too far apart.
an "equilibrium price" seems to imply some sort of stability, but when the future is uncertain, prices will be uncertain, without implying a market failure. there can be "information failures" that steer prices wrong, but prices can be uncertain just the same even given all current information.
> Below-normal rain in Brazil has heightened coffee crop concerns and is supporting coffee prices after Somar Meteorologia reported Monday that Brazil's biggest arabica coffee growing area of Minas Gerais received 12.4 mm of rain last week, or 20% of the historical average. Brazil is the world's biggest arabica coffee growing country.
In 2021, the extra large 1200 grams pack of coffee beans cost €6,50 at the Lidl in the Netherlands. This month you probably won't find any at the Lidl (not in the ones near me in any case). Other supermarkets have similar empty shelves due to a conflict with the biggest brand name supplier (JDE Peet's), and what is available costs perhaps €10 per kilogram for some of the remaining supply, but €15 per kilogram is now the normal price.
One factor sometimes mentioned in addition to the bad harvest, is the rise in coffee consumption in China having an definitive impact on the market.
Interesting. I wondered what the alternative was made of, and their FAQ answers it very nicely:
What is Coffee Free Coffee made of?
Our blends consist of a mix of roasted cereals, legumes, roots and fruits.
The filter blend is made of roasted lupin, barley, chickpeas, chicory, natural aroma, dried black currant, citric acid and caffeine. The decaf version does not contain caffeine.
The capsules variant is made of roasted lupin, barley, fig, chickpeas, chicory, natural aroma, dried black currant and caffeine. The decaf version does not contain any caffeine.
The espresso is made of roasted lupin, fig, chicory, chickpea, natural aroma, caffeine, citric acid and baking soda. The decaf version does not contain any caffeine.
(If anyone from the company happens to be reading, I'll mention that my first attempt involved following the link from the front page to "Discover More", but this currently leads to a 404 Page Not Found)
No one has mentioned China's uptake of coffee drinking, or their long term contracts with coffee growers, buying up whole crops. https://www.youtube.com/watch?v=_aR4RCqw-gg
This prompted me to re-order my 20lb bag of green beans early this year.
Looking back at my order history the price has been the same ($129) for the past four years, but now is $134. Not exactly a steep rise, but more than zero.
“Coffee trade” is not monolith. There is commodity and specialty. The specialty side has been moving more toward just in time inventory for a while. It’s shocking how long the farm-to-processor(s)-to-distributors-to-roaster-to-brewer/consumer span can be and how many warehousing and exchange steps there are. Moving to just in time is quite disruptive for many business models; it’s not just this jump in price.
I roast around 15 pounds a year. I noticed prices have gone up 1-2 dollars/pound at my main supplier (sweet marias). The average is now about $8.5/pound. That is a price I'm still comfortable with.
At my consumption level so far the price changes haven't been a big deal. It could be that high end beans haven't been as affected - or maybe that was the 'brutal' price hike.
I also roast for personal consumption, about 25 pounds per year, and concur on the price increase. Just a few years ago green coffee was in the $6.50 range (and when I started roasting about 7 years ago, even $5), but as you said more like $8.50 now. I just did a relatively large buy (about 20 pounds) as a just-in-case because it's impossible to predict what the demented orange or the ketamine-stuffed Nazi will do.
"They don't know if they will be able to sell their product at the new prices," he said, also asking not to be identified. "Some people are going down".
That's surprising to me, considering that coffee is quite addictive. Will consumers really stop drinking it if it gets too expensive? Is there a really a strong correlation between coffee production price and the amount sold to end consumers?
>That's surprising to me, considering that coffee is quite addictive.
https://en.wikipedia.org/wiki/Caffeine#Addiction
Actually no, it's not considered addictive. Yes, anecdotally you will find people that say they're addictive. Pick almost any subject and you can find someone that says they're addicted to it.
> That's surprising to me, considering that coffee is quite addictive.
I'm not sure that it really is. You can build a physical dependence to caffeine, but in my experience there's no mentally addictive component. For a period of time I drank a lot of coffee and then stopped cold turkey, and the only effect was a couple days of physical unpleasantness. I now limit my coffee consumption to a max of one cup per day, and have no issues switching between coffee/decaf/no coffee on any particular day or for any arbitrary period of time.
My personal experience is that my withdrawal symptoms are not that bad. I used to pause my coffee consumption when the euphoria significantly diminished.
I hope someone can authoritatively answer the correlation question.
Withdrawal isn’t so pleasant from coffee. It was like a lite version of nicotine withdrawal for me. Headache, brainfog, lethargy. A few days of that and you are done in both cases. It took quite a lot of coffee to get that sort of withdrawal though. My current consumption of a cup or three a weekday isn’t enough to hit that. You need to be doing about 4 or 5 cups a day without skipping weekends for some time to get to that in my experience.
Really it’s an indictment of how poorly run Greenland is that such an agricultural paradise isn’t the leading producer of tropical produce. I mean the word “green” is right there in the name!
Is that a theoretical concern? Or do you actually know someone (personally, I mean) who has had such a change of heart?
One mark of a moral panic is the intensity of feelings people have about topics that are very distant from their actual experience. The kids say “touch grass,” but perhaps instead it should be “talk to someone actually involved.”
What is the goal of restricting examples to “personally”-known relatives?
Did people in 1943 personally knew people who got killed? Do I, as a gay person, personally knew the gay who was killed because he was crossing the main square of my city (France) which is under occupation by the muslims?
Do I care? Yes, absolutely. As a gay person, I have the electoral choice of either we become a muslim-majority country, either I vote for the French equivalent of trumpism.
Result: In my city, 35 out of the 35 core group of the extreme-right party are gay.
Coffee YouTuber James Hoffman makes a pretty convincing argument that we are living in the golden age of coffee. Lots of excellent coffee and it’s pretty affordable. But he thinks it could end soon.
Everybody knows that climate change could be a problem, but he says an even bigger problem is urbanization. The average coffee farmer’s age is 50-something and their kids don’t want to take over the farm, they want to move to the city. The people who are willing to work the farms, want to be paid a lot more, so there’s upward pressure on prices.
Right now cafes can charge $4-$6 for a coffee drink and people seem to be willing to pay it. As coffee gets more expensive, how many people are willing to pay $6-$8? For a lot of cafes, it won’t take much of a drop in business to kill them.
> The average coffee farmer’s age is 50-something and their kids don’t want to take over the farm, they want to move to the city. The people who are willing to work the farms, want to be paid a lot more, so there’s upward pressure on prices.
Good. Farmers are criminally under-paid when people doing nothing productive in the economy are getting paid for their annoyances. It is time the system gets a reset.
The cost of coffee beans in a standard espresso drink is ~25 cents, and that's if you are brewing ultra high-end $15-20/lbs beans. Raising the price of the beans by 15% or 30% or even 50% isn't going to make all that much difference to margins when the end product retails for $4-6 or more.
The coffee shop business is only tangentially related to coffee. Whether you will be successful or not depends more on location, labor, branding, interior decor, music, bakery, food, upsells..
Might want to check your math there. At $20/lb, zero waste (!!), 18g of coffee is $0.80/shot. Add in 10-15% waste (accurately predicting exact supply of beans is almost impossible, plus dialing in, mistakes, and training) and a more standard 22g basket, you get $1.12 per drink.
Aiming for 25% COGS, that pushes up the price of a cup to $4.50 before milk, syrups, cups, etc. If the cost of coffee doubled, you'd be looking at the cost of coffee only being 38% COGS for a $6 drink. That kind of increase is not only going to completely remove all margins, but likely put you in the red per drink served.
Those are some far fetched numbers, that's the price of premium/specialty coffee and the amount is easily a double shot, even triple by Italian standards.
Common commercial beans are ~$24/kg at retail prices, and while 14g would be a double shot around here, let's assume that's a "single shot" since standards seem to differ a lot. That puts us at a much more reasonable $0.39 per "shot" of coffee after accounting for 15% waste.
On a personal note, I would actively choose to pay $0.40 more for coffee if I knew that the money went back to the farmers who produce it.
There is no "standard 22g basket". Regular 8-12 oz drinks at most coffee shops have a single 7-10g shot. Double shots and larger sizes always cost more.
Outside of Italy nobody uses single shot baskets.
All espresso based drinks you will find will be double-based.
And especially any place which is doing specialty coffee is going to be using larger doses to make extraction more consistent with lighter roasted coffee (in the realm from 18g to 28g).
It's pretty normal nowadays to see 20g or 22g baskets used in specialty coffee shops.
You can obviously order a single but the price difference is just a trick, the other shot gets dumped unless two people order singles at the same time.
> Outside of Italy nobody uses single shot baskets.
Some Swiss coffee shops do that, but we are close to Italy here. Lots of Italians live here and would be very unhappy without their espressos.
I have no idea what you are talking about. The world's largest coffee chain (Starbucks) uses a single 1 oz/7 g espresso shot in their short (8oz) And tall (12oz) drink sizes. To get two shots you have to upgrade to "grande" (16oz), or specifically ask for (and pay for) an extra shot. Most coffee shops do the same for their smaller drinks.
Starbucks does use singles in some Tall drinks (your point stands - Latte & Cappuccino), but not all (Americano & Flat Whites have 2 shots in a tall).
Meta: I've never seen anyone order a short, the only thing I've ever seen in those cups are espresso pulls or water (but it turns out a Short Flat White still has two shots - worth a look)
Starbucks makes coffee flavoured desert drinks. We are talking about specialty coffee shops. I've also never seen starbucks use a single shot basket to pour a single shot. They always just split, this is broadly the standard. Nobody outside of Italy is making single shots with a single shot basket.
> Starbucks makes coffee flavoured desert drinks.
You don't have to order the caramel drinks? There are coffee, latte, cappuccino etc too everywhere, right?
It depends how nice the machine at your shop is. Some are on a more automated machine that just has a button for one or two shots.
Using a single shot basket is different than using a single shot of liquid. Does Starbucks use single shot baskets?
<iamveryculinary country="it">
That's because Starbucks single espresso shot are absolutely atrocious.
</iamveryculinary>
> Outside of Italy nobody uses single shot baskets. > All espresso based drinks you will find will be double-based.
Do you have a source for these claims?
For #1:
Ask any coffee professional (someone who actually knows what they're doing).
Or just go walk around. Try to find a cafe which is using different portafilters with single spouts (an indication of a single shot basket). Or ask them. Buy a single espresso and watch what they do. You will never see them use a single shot basket or a single spouted portafilter. You will always see them split a double.
For #2:
Since nobody is using single shot baskets, and no reputable coffee shop is setting aside split shots to use in someone else's drink, the only time it would make sense to make a coffee from a single shot is if it would be too intense with a double (hard to imagine). The alternative is just wasting coffee in most cases except when you're lucky and your customers order drinks where you can use the other split shot. But I don't really see anyone splitting shots for milk drinks, maybe I've not paid enough attention as I don't drink them that often. Either way, you're still brewing a double shot.
You can again, just watch what they're doing. I've never seen a coffee shop where you can't see the bar and the machine. Just watch what happens.
Lastly, you can't dial in a single shot basket and a double shot basket at the same time, you need to have dedicated grinders dialled in for both. Nobody outside of Italy bothers with that. For specialty cafes you'd be doubling the number of dialled in grinders which would be especially impractical.
At least in Austria, this seems to be a recent phenomenon, and limited to "fancy" coffee places. I was surprised the first time I saw the barista throw away half the coffee when I ordered an espresso.
I don't have statistics, but I think that single spout portafilters are still common in traditional Austrian cafes. I agree that you can't perfectly dial in the grinder for both single and double shot, but only a minority of people care about James Hoffmann levels of perfection and outside of speciality coffee shops nobody drinks light roasts.
One curious thing I saw in a bar in Italy that their machine had a much smaller diameter portafilter, so they can make a 7g shot without these conical sieves.
Coffee is extremely finnicky and its really not as easy as you think to make even a passable shot when going between baskets with different doses. Even with an Italian dark roast.
This isn't about making amazing shots of light roast coffee, it's about the difference between an acidic and a bitter coffee. If your customers are buying and drinking straight espresso (also uncommon outside of Italy and some bordering countries) then they will notice and complain. Although I guess since most people in these regions drink singles, maybe cafes dial in for the single and just YOLO the double. I don't know much about how Italian cafes are ran as I am simply not into that style of coffee nor do I live in Italy. Outside of these regions where its common to drink straight espresso, most cafes just half ass the dialing in and if you ask for espresso its usually varying kinds of mediocre to trash. Regardless, nobody uses single baskets. In the specialty cafes where you can order a straight espresso and expect something decent to amazing, you also never see single baskets and single shots just result from a split with half of the shot wasted or in another concurrent customer's cup.
Regarding Austria, it seems like countries which border Italy also seem to often do single shots too. I didnt consider this but it also doesn't surprise me.
Regarding the portafilter, the industry has standardized on 58mm group heads in the commercial setting but there are still some smaller diameter machines out there which make pulling smaller shots much easier.
There are currently almost no new commercial machines in that format but its entirely possible it will change in the future.
I for one am considering buying an adapter for 49mm baskets so I can more easily extract good light roast espresso without needing the larger doses.
I know the struggle -- We have an espresso machine at home and would love to be a able to do both single & double shots, but I have never managed to find a setting that works for both, so it's dialled in to single shots. I figured that cafes maybe are better at finding a middle ground. There must be a reason why most grinders have two separate timers for single/double tap.
> you need to have dedicated grinders dialled in for both. Nobody outside of Italy bothers with that.
Huh? Most cafe's I see (Australia) the grinding is separate from the dispensing, and it is a single shot per pull. It's a big world out there mate, might be more of an isolated cultural thing than you realize or my neck of the woods is special. Either way, likely varies.
> Huh? Most cafe's I see (Australia) the grinding is separate from the dispensing, and it is a single shot per pull.
This is just not how espresso works.
You can dose the same grind into a double basket and a single basket and you will never get the same coffee out of both.
Maybe Australia is special but in Europe, the UK and America, except for Italy (and apparently some surrounding places) nobody is using single shot baskets.
This is jusg a well known fact in the coffee industry.
This reply doesn’t make sense… your own words and opinions can’t substitute for providing sources.
Unless you have some extraordinay amount of authority and/or credibility above and beyond that of the other HN users contradicting?
I don't carry around sources for well established industry wide facts which you can verify yourself by opening your eyes. Do you carry around a source that proves that using a keyboard to type is faster than using morse code?
James Hoffman (coffee professional, winner of WBC) discusses the obscurity of single dose baskets in his video here. He mentions they're not often used in the home because he is discussing home espresso but the 50 caveats of single dose baskets apply to the industry too.
https://youtu.be/3oFV88PzEFE?si=_cUs33SeovZ0jHYJ&t=549
Discussion of single baskets by The Wired Gourmet pointing out that in the industry double and triple baskets are used and split in vast preference to single shot baskets. Also covering the difficulty of working with single shot baskets:
https://www.youtube.com/watch?v=3OnH2Woluck
The Real Sprometheus video talking about single shot baskets, their obscurity,
https://www.youtube.com/watch?v=y0XariiJiHk
A cafe owner talking about why single shot baskets are not worth it in a commercial environment:
https://www.youtube.com/watch?v=-N3OlSa-4Wg
The reason people in this section are disagreeing with me is because they have never made specialty espresso and have no idea how difficult it is to dial in a single basket, even if you're a cafe.
And what of the second claim?
“All espresso based drinks” seems incredibly broad.
Again, this only takes basic experience in coffee/cafe drinks to understand this is true. The standard espresso based drinks are: espresso, cappuccino, latte, macchiato, cortado, flat white, americano, mocha, and a few other varieties. Every single one of those starts with a double shot of espresso (~1.5-2 fl oz of liquid). This is sometimes even referred to as a 'single shot' even though 1.5oz would put you in what is considered a double shot.
There may be some niche drinks that use less espresso liquid, but they're not common. If I was only given 0.8 fl oz (which, is what a single shot looks like) in an espresso drink I would be upset.
Yeah it's a general rule, there are some exceptions, but they're less common than is worth challenging this claim for. Some drinks would be too strong to be made from a double, these will use a split single in countries where doubles are the norm. The second shot will end up wasted unless someone else is ordering the same exact drink or ordering a single espresso (also rare outside of Italy and some other countries). I've seen it but most customers prefer to see bigger drinks these days so most cafes don't usually face this problem and make drinks from double shots.
For reference, I use a 36g shot (basically 36ml if you wait for the crema to dissipate) for a 170ml "flat white" at home. This achieves a balanced strength for this kind of drink. You really have to get into the tiny drink category before you really reach the realm of "this is too strong and I must use a split single". And, in those cases, due to the fact of the double shot (and, I would struggle to come up with "sources" but it's again generally accepted that unless you can use the second split shot for a drink immediately, it goes down the sink), you are still often using a double worth of coffee for a single shot drink.
lol this thread is amazing. Hacker news is truly a place filled with confidently wrong smart people. Showed this to my wife, a barista in Seattle, and she asked me why I go to this stupid fucking site. I wasn’t able to give a good answer other than boredom.
I mean if you think about it, almost nobody here is a Barista (home or commercial), but most people here are technical. People don't realise the complexity of coffee when they haven't actually tried making espresso so it's not too surprising that you get people who think they've figured it all out in their head. Same thing happens on this website with basically any niche technology (haha, I can't believe I am referring to brewing coffee as technology).
I just did my math (because I was curious, not out of doubt) and it came out to $0.33 per espresso -- $20 for a 2 pound bag of beans from the grocery store @ 15g per "double shot" using the stock basket that came with the machine.
True, I'm not using 'premium' beans and probably doing it wrong but it works for me. Add in 'natural spring water' and 6oz of chocolate milk and I doubt it gets over $0.75.
Yes, if you assume coffee costs half as much as previously stated, it does almost halve the cost.
If you are paying $20 a lb for expresso beans you are probably not a coffee shop and definitely not buying the coffee that costs $6 at a chain coffee shop.
The standard size for a bag of coffee is 12oz, at least in the US. $20/lb is equivalent to $15/12oz. $15 for a 12oz bag of coffee is pretty standard for anything that isn't bottom rung these days. It's not even 'great' coffee at that price; I'm just talking about something mid-tier like Counter Culture coffee which is available nationwide.
Anything cheaper than that and you are firmly into the budget coffee tiers.
$15-$20 / lb is not ultra high end. That’s the normal price for beans from most roasters. High end is around $40 / lb and ultra high end is much more.
25 cents (20 pence)? Ultra high end $15-20/lbs (£6.40-£8.50/250g) beans?
Where are you getting good coffee that cheap? You're pulling shots out of 7.5g of coffee?
I am buying some nice beans here in the UK and my espresso coffee cost has now reached £1.10 per.
I'm doing relatively standard 19g shots.
I think you are using a very narrow definition of "nice beans". At one pound per cup in bean cost, you are doing some coffee equivalent of having a glass from a £500 champagne bottle or listening to music from a pair of £10k speakers. Amazing for sure, but not a reasonable floor for defining "nice".
Normal premium beans are around €15 in a 450g bag over here, and I can't imagine they are all that much more expensive in the UK. If you buy in bulk, they will be a lot cheaper.
The actual premium beans are even more expensive.
Yes at £20 per 350g I am paying slightly more than normal for "nice beans". But most places sell for no less than £10 per 250g of light roast. That's still 76p ($1) per shot.
The only things going for less are darker roasts, supermarket coffee and blends.
Pact is £7.95/250g (or I think £8.95 to new customers) for the mid-tier (any roast) bags. House blend & premium tier are iirc £1 either side.
Pact isn't ultra high end. Its pretty middle (maybe a bit better) of the road as far as UK roasters go.
Ultra high end would be Gesha or something equivalent. Those often go for fun prices like £28 (and that is still on the low end) for a 150g bag in the UK. That's £3.50 for a 19g shot, and if I was buying Gesha I would probably get a triple precision basket or a step down basket because I would want the absolute best chance of extracting well if I'm spending that much.
My £1.10 shots are definitely above middle of the road. Maybe you can call them high end. But they're not ultra high end and a single shot of ultra high end is definitely a lot more than $.25 as the initial comment in this chain seems to claim.
> Pact isn't ultra high end.
I don't claim it.
I responded to:
> But most places sell for no less than £10 per 250g of light roast. That's still 76p ($1) per shot.
> The only things going for less are darker roasts, supermarket coffee and blends.
I just want to chime back in and say that the post I replied to said "nice beans" at £1/cup and the post that was a reply to talked about the cost of beans for a "standard espresso".
My intended angle was to say that I think "nice beans" for a "standard espresso" starts lower than that, for the coffe-appreciating general public.
People like me, who thinks a Starbucks espresso is nothing special but decent enough. Anything better is nice beans! :-)
Coffee from Okinawa would probably be my pick for ultra high end. It sells for about $2 / gram (or 250g for $490). These producers don’t make much coffee each year and it sells out very fast.
I heard of that one, have never tried it. I've always wondered how much of that is just the fact that it's some tiny farm vs actually tasting unique.
I am spoiled for choice, I've modded my machine to be able to do electronically controlled pressure and flow profiles. I wouldn't even have a clue how to dial this in quickly enough to enjoy it (other than relying on Gagné's adaptive profile).
If/when I'm ever in Okinawa I might see if there's a local cafe which has already dialled it in and can brew it for me. I think that's probably the most cost effective way of trying this coffee.
250g bags are only 70% of the size of a 350g bag. Also, they don't seem to offer anything except blends.
Their actual more expensive coffee (which even then, it's unclear if this is a blend or not) is 14 pounds a bag, which... when you scale to 350g comes out to, unsurprisingly, about 20 pounds.
> Normal premium beans are around €15 in a 450g bag over here, and I can't imagine they are all that much more expensive in the UK. If you buy in bulk, they will be a lot cheaper.
Those are not premium beans, no offense. I agree, bulk pricing will be cheaper than retail, but premium bean pricing is still quite a bit more.
If you want the equivalent of 'having a glass of 500 euro champagne', you need to look appropriately upscale.
Here's an example of that, from April coffee roasters: https://www.aprilcoffeeroasters.com/collections/limited-coff...
They sell a 250g of a natural Gesha coffee for 928 kr - or ~85 euros. That works out to ~6 euros per 18g of coffee if you were to serve this as an espresso. Most of the time, such coffee is used for pour overs, though.
Keeping it in a local context: Lidl sells coffe beans for 200kr/kg. That is pretty cheap coffe and they probably have very high margins on it.
Zoegas fairtrade beans are perhaps twice that price. That is premium coffe. (like Barilla is a premium pasta, Galbani makes premium mozarella, Alfa Romeo makes premium cars, Rotari prosecco is a premium sparkling wine).
If you go far beyond that, you are in high end territory. (Ferrari vs Alfa Romeo, champagne over prosecco). There is no limit to what you can spend to get the most unique flavour experiences.
And trying it back to the very root of this thread. A random, generic café that charges 8$ for a single shot espresso, does not need to do that because the cost of beans is killing them. The cost of beans is essentially nothing, unless you are a one-in-a-thousand speciality coffe house.
> If you go far beyond that, you are in high end territory. (Ferrari vs Alfa Romeo, champagne over prosecco). There is no limit to what you can spend to get the most unique flavour experiences.
I really don't agree with that. $20/kg of coffee is quite cheap, at least in the US. Maybe Sweden has wildly cheaper coffee prices, but I doubt that.
$20/kg equates to roughly $6.80 per 12oz, which is below the bottom end of coffee prices you can find in a store if you're buying 12oz bags.
A normal 'specialty' coffee costs at least $14/12oz (or, ~$40/kg). That coffee is nothing particularly extraordinary. In car analogies, that would be the equivalent of a low-end Lexus or Mercedes.
The Lidl-coffe is very cheap at $20/kg! That is my definition of what is currently the cost of low-end, budget-beans.
Stepping to twice the price of the low-cost beans is my definition of premium. Like going from a 30k Fiat to a 60k Alfa Romeo.
> Stepping to twice the price of the low-cost beans is my definition of premium. Like going from a 30k Fiat to a 60k Alfa Romeo.
Your definition of premium isn’t based in reality, though. It’s more equivalent to going from a $5000 motorcycle to a $10000 used car, to continue straining the car analogy.
If the $86/bag coffee is the equivalent of a Ferrari, then scaling down by the same amount would be your $60k car. Which would be like paying $14/bag (for 12 oz of coffee).
It's worth noting that while that's a fair comparison to the wine bottle, it's not necessarily true to say that either the bottle of wine or the Gesha coffee are inherently higher quality or more premium, they're just rarer or more expensive to produce and somewhat more novel than what a person would get most of the time. You can probably brew equally as satisfying and flavorful coffee by spending significantly less than half that rate, it just won't be as fancy feeling.
As someone who drinks quite a few of these incredibly weird coffees: I don’t agree. You can get some of the way there, but there are flavors and experiences that you won’t recreate with cheaper coffee.
There just is no way to get as clear of flavor separation and striking flavors as you can get with some highly specialized coffee. Gesha coffee is well known, but you can also spend a lot on expensive processing techniques such as fermented coffees.
As an example, there was a coffee I had for a period of time that tasted like cherries. Not just “hint of cherry”, I had multiple people tell me this coffee tasted like candy. Not coffee flavored cherry, just cherry. I’m currently drinking a coffee right now that tastes like red wine.
Can you get a lot of the way there? Absolutely. A nice Ethiopian coffee naturally processed can be half or a third of the price of a Gesha and still have lots of fruity flavors.
It’s true that some expensive coffee doesn’t live up to the hype much like expensive wine, but it’s unfair to say that the only thing expensive coffee is buying you is uniqueness.
> but it’s unfair to say that the only thing expensive coffee is buying you is uniqueness
I don't mean to be intentionally obtuse, but it does seem like you just described that what you get primarily is uniqueness or degrees of uniqueness.
What I was intending to say is that you can absolutely get within a negligible margin for far less than half the price of say, 85 euro per 250g, which is comically expensive, all equipment and other ingredients kept more or less the same in terms of investment. Not all fermented coffees run that high either, and a lot of the cost comes from rarer varietals that may or may not be unique, but just aren't inherently higher quality than high specialty grades of others. For example https://www.prototypecoffee.ca/shop/oxaofizuq8la2g7m9ercvtxv...
That's not to say they aren't worthwhile or in-appropriately priced novel occasional experiences, but in a similar fashion to what you said, there are various high-grade less expensive beans to be had from Ethiopia, Indonesia, Colombia, etc.. that can distinctly taste like watermelon, starburst, blueberry, cherry; they're still very expensive relative to even quite good blends from a local roaster, but they're not that high. Incidentally, if I wanted just cherry, actual cherries at their already high price would be wildly less expensive, but that's besides the point. Ultimately they're still subject to variation in brew consistency, palate, etc.. to the point that I'd prefer to get on average 98% of the way to the same cup with 1/2 the spend considering how likely it is that some of it won't turn out that great anyway, especially without a multi-thousand dollar grinder or custom recipe water.
The exception to my comments may depend on market too, I don't know how expensive some of the extremely fruity Indonesian beans may be in EU for example, or how much a Pink Bourbon might be in Aus.
For all of the best specialty coffee I've had, there's been at least one cup at the same price-point, same roaster, same cafe, that just wasn't anything amazing, and it's a silly amount of money to chase an occasional unique novelty as a regular thing imo. I'd rather have very good most of the time for much less than half as much.
> What I was intending to say is that you can absolutely get within a negligible margin for far less than half the price of say, 85 euro per 250g, which is comically expensive, all equipment and other ingredients kept more or less the same in terms of investment. Not all fermented coffees run that high either, and a lot of the cost comes from rarer varietals that may or may not be unique, but just aren't inherently higher quality than high specialty grades of others.
Fully agree. There's plenty of good coffee you can have that isn't stratopherically priced. That said, there's a certain price bracket where you just cannot get some of these flavors. Anyone buying $10/lb coffee will never get those flavors. If you want lightly roasted coffee with fruity or floral flavors, you have to spend a certain amount.
I'm not suggesting you have to spend the "$500 champagne" equivalent to get good coffee; I'm just saying that coffee isn't a percentage goodness thing. For certain types of coffee flavors, there isn't any way around spending money to get them. Certain flavors are a lot easier to achieve with lower cost coffee, though. Any sort of chocolate or nutty flavor is generally easier to achieve with cheaper coffee, so if that's what you like drinking... then you probably don't need to spend as much.
I've found that befriending a roaster can get your price down by half. YMMV
Do you think stalking James Hoffman is a good way to make friends with him? Just taking notes.
There are lots of local roasters but I'm a little bit too introverted to make friends that easily.
I think making an electronically controlled hot air roaster and just roasting at home is less effort than what you suggest. ;)
I think there would be magnifying effects, but possibly in the opposite direction.
If coffee becomes more expensive, buying a bag of coffee for your home and being terribly inefficient with doseages and such would not be so viable.
If coffee houses can maintain price relatively stable they become much more viable. Especially since the other cost factors can keep coffee consumption in check.
I really can't imagine home coffee reaching an expense of 5$+ a cup to equal out to cafes
I've been able to buy a pound of high-quality whole bean coffee for $15-$20 for about 20 years now. I assumed the cost at cafes had more to do with labor and rent.
> Right now cafes can charge $4-$6 for a coffee drink and people seem to be willing to pay it. As coffee gets more expensive, how many people are willing to pay $6-$8? For a lot of cafes, it won’t take much of a drop in business to kill them.
Sure, but to drive an increase of that amount using coffee bean prices alone requires coffee beans to double in price.
The majority of that $6 coffee you are buying at a cafe is non-bean costs. IOW, of that $6 coffee, maybe $1 worth of beans are used.
(If, like me, you drink only black coffee with no sugar or milk or flavouring added, you will also experience the frustration of paying almost the same as everyone else who is buying some flavoured coffee)
Nah, coffee can go to $12 a cup and people will still pay. We will see corporations subsidize the cost for their workers as necessary.
Don’t they do that already?
I swear most cafes I've been to are already selling coffee for $6-$10.
That’s almost entirely for rent.
IMO if we actually wanted to overhaul our economy, we could do it by just having POS’s print the portion of each bill that goes into rent.
Then the culprit of COL increases would be quite clear.
Especially given that wages are themselves also driven up primarily by rent.
I would agree to this if we also displayed the amount going toward taxes.
Then we'd need the receipt to itemize all the things we got thanks to those taxes, like the roads the beans came in on, the traffic lights and road signs that allowed the trucks to deliver those beans safely, the clean water/air, the health inspections that make sure the backroom isn't totally rat/roach infested, the building codes that keep the roof from falling on us while we order, the schools that educated the employees, the power grid that keeps the lights on, the police that keep crime away, the Office of Weights and Measures and consumer protection laws which ensure we're getting what we paid for, etc.
Eh, given that everyone pays income tax (largest portion by a mile) I think most people are aware of what drag that adds onto the economy.
Most people have no clue how much a storefront pays in rent.
Agreed, and the cost of any new building that went to taxes, permits, development fees.
That is all baked into rent, including the developer's profit margins
That's my point, the data is obscured in such a way that all we see is an abstract price going up, but not how much of that price was directly or indirectly influenced by the cost of bureaucracy.
Permitting etc. is 0.5% to 2% of development costs, which is itself a small subset of what rent pays for, and only for the first 5-10 years.
This number would be $0 for most cups of coffee (made in paid-for buildings) and <$0.02 for pretty much all the remaining ones, I think?
Rent on the other hand is 15%+ for every cup of coffee in perpetuity (not counting second-order question of what % of wages go directly into residential rent).
Sorry I was actually making a less related comment than I initially indicated. I meant (loosely) indicating how much of new builds for things like developments in general go to bureaucracy or land, since in my city it seems like they heavily subsidize existing homeowners and have intensely increased in recent years, having the indirect effect of raising the floor and pulling up the ladder.
I agree with your response though.
It's hard not to imagine we're in a golden age for most things at the moment.
That's because coffee farmers don't make any money it's all going to Western corporations.
Corporate agriculture will buy up the land and find ways to produce at a profit.
Starbucks regularly charges $15 for coffee flavored drinks today.
I'm not worried about coffee. I'm worried about climate induced resource wars.
> Starbucks regularly charges $15 for coffee flavored drinks today.
Uh, where? Worst I've seen is the extra large Frappucino, which could be as much as $10 after tax and a generous tip. I struggle to see how you could get to $15 for a single drink.
If you buy regular coffee or a more basic non-milkshake drink, they're closer to $5.
I'd take that chance to (slowly) quit coffee. Possibly go into lower caffeine beverages like tea.
I mean let’s be honest, coffee will rise to 6-8 bucks either way cause of inflation
Not a big deal. Coffee is not a necessity. The coffee monoculture is devastating for the environment. Most small coffee farmers and plantation workers don't earn a livable income. Only 10% of the retail price of coffee goes to farmers. The whole industry is exploitative.
Don’t drink coffee. It’s that easy.
Ya but I love it, and there are plenty of small farms that do it for a living.
It seems like there was lower coffee production so they hiked prices due to the more limited supply. It also seems like they hiked prices too high with suppliers saying that they've only sold 30% of their production when they'd normally have sold 100% by now.
It does kinda show how markets don't just magically hit an equilibrium price. The prices went up due to limited supply, but then the sellers couldn't sell at those higher prices. Negotiations over price aren't going fast and buyers are only buying what they can immediately use/sell.
> It also seems like they hiked prices too high
How is that even possible?
> It does kinda show how markets don't just magically hit an equilibrium price.
Generally, markets do "magically" hit that.
Can you explain why, at the moment demand dried up at the higher price, the suppliers didn't immediately drop the price to meet demand? That's generally how these things work.
Unless there's some kind of cartel operation at play here. In which that's to blame, not the market.
Can you provide any links with greater detail?
I was wondering how it’s possible too. The article mentions this exchange:
https://www.ice.com/products/15/Coffee-C-Futures
My take:
Futures traders decided the price would go up 70%, and were very wrong. This led to the standard “C” contract (set by the ICE exchange) price being too high, tanking demand. If you want to participate in the futures market, you need to have a license you get from the exchange.
I’m sure some producers will try to bypass the exchange market that manages all that, but, ultimately, someone will have to lose a bunch of money. It’ll either be the traders (futures contracts end up being worthless) or the producers (coffee ends up rotting or being refused by the silo).
The article suggests it’s the latter, which makes me wonder how powerful the exchange is, and what happens if you just start freighting bags of coffee around.
So why is an exchange setting a price at all?
That's not how exchanges generally operate. They generally simply match supply and demand.
An exchange setting prices is the literal opposite of a free marketplace. Is this more of a cartel, like OPEC?
I’m not an expert on agricultural commodity exchanges, but at least some (like the Chicago board of trade) look like a cartel from the outside. The cartel controls distribution, and squeezes the producers and the consumers.
If that’s happening here, that’d explain how we can be in a situation where the (1) retailers want to buy coffee, but can’t afford the newly hiked price, (2) the producers are sitting on unsold inventory that they can’t discount, and, simultaneously (3) there’s a glut of distribution capacity and things like silos are sitting empty and going bankrupt.
Whenever someone says the market doesn't work it's just because it's not doing what they think it should, as if there's some pre-ordained magical prices.
A market that allows gamblers to cause resources to rot rather than lose money on their own bad bets is working exactly as a market should?
Seems to me the bigger magical leap here is in the observer who considers this to be either desirable or necessary.
If the people that wanted to buy bought, and the people that wanted to sell sold, and there was no fraud, yes.
This is why no one should take capitalist true believers seriously.
It’s not an efficient (let alone moral) distribution system if one of its outcomes is spiraling prices that are irreflective of genuine market demand.
The whole problem highlighted here is that the people who want to sell cannot sell because the buyers don’t want to eat their consequences and man up to the loss on their gambling.
I'm curious to know from someone who understands better- isn't this the kind of volatility that futures markets are intended to prevent? If actual product movement has changed significantly then is it just that this moment is especially volatile, or are futures as a mechanism not particularly meant to deal with this?
That was always touted as a reason, yes. I am sure it is partly true, within certain bounds.
Futures aren’t meant to do anything, are they? Like so much of the market, they are just another partial-information lottery which isn’t explicitly forbidden by weak regulators.
(But I’m not someone who knows better)
Futures market started as a way of (and in America were strictly limited to) prpducers and wholesale buyers to hedge/fix their costs.
Then American regulators started handing exceptions to allowable market participants out like candy and suddenly the markets are majoritarily financial middlemen who do not want to take delivery.
Futures markets make lots of sense and are very useful. How they are currently constituted does not.
futures markets (among other things) allow producers to temporally match assets and liabilities.
> It does kinda show how markets don't just magically hit an equilibrium price.
There's lot of research on situations where market prices fail to work, but not much (as far as I'm aware) of when they largely work, but there are times when the market seizes up (and how to avoid such situations). or do the risk of such situations are so great that a product should not a be allowed to have a truly "free" market. e.g. petroleum.
it's difficult to impossible to believe that there is any failure currently in the international coffee market. (i'm replying as much to GP as to you, not disagreeing with you)
>markets don't just magically hit an equilibrium price
markets do magically, and quickly, hit a "market clearing price" where all the bids and asks that match are executed. the market can also slow when there are plenty of bids and asks but they are too far apart.
an "equilibrium price" seems to imply some sort of stability, but when the future is uncertain, prices will be uncertain, without implying a market failure. there can be "information failures" that steer prices wrong, but prices can be uncertain just the same even given all current information.
Sellers will start holding more inventory. and wait for buyers to run through theirs.
This isn't tariff related.
Per NASDAQ:
> Below-normal rain in Brazil has heightened coffee crop concerns and is supporting coffee prices after Somar Meteorologia reported Monday that Brazil's biggest arabica coffee growing area of Minas Gerais received 12.4 mm of rain last week, or 20% of the historical average. Brazil is the world's biggest arabica coffee growing country.
It's climate related.
In 2021, the extra large 1200 grams pack of coffee beans cost €6,50 at the Lidl in the Netherlands. This month you probably won't find any at the Lidl (not in the ones near me in any case). Other supermarkets have similar empty shelves due to a conflict with the biggest brand name supplier (JDE Peet's), and what is available costs perhaps €10 per kilogram for some of the remaining supply, but €15 per kilogram is now the normal price.
One factor sometimes mentioned in addition to the bad harvest, is the rise in coffee consumption in China having an definitive impact on the market.
I've switched to a 50/50 blend of regular coffee and coffee-free alternative from Northern Wonder (https://northern-wonder.com).
I combine 50% traditional coffee beans with 50% coffee alternative made from locally produced beans in my espresso machine.
The blend works so well that I have no desire to return to using 100% regular coffee beans.
I maintain the 50/50 ratio because real coffee provides an incredible aroma that I don't want to give up (for now).
Interesting. I wondered what the alternative was made of, and their FAQ answers it very nicely:
What is Coffee Free Coffee made of?
Our blends consist of a mix of roasted cereals, legumes, roots and fruits.
The filter blend is made of roasted lupin, barley, chickpeas, chicory, natural aroma, dried black currant, citric acid and caffeine. The decaf version does not contain caffeine.
The capsules variant is made of roasted lupin, barley, fig, chickpeas, chicory, natural aroma, dried black currant and caffeine. The decaf version does not contain any caffeine.
The espresso is made of roasted lupin, fig, chicory, chickpea, natural aroma, caffeine, citric acid and baking soda. The decaf version does not contain any caffeine.
https://northern-wonder.com/pages/faq
(If anyone from the company happens to be reading, I'll mention that my first attempt involved following the link from the front page to "Discover More", but this currently leads to a 404 Page Not Found)
They made soykaf real?
Fascinating.
No one has mentioned China's uptake of coffee drinking, or their long term contracts with coffee growers, buying up whole crops. https://www.youtube.com/watch?v=_aR4RCqw-gg
This prompted me to re-order my 20lb bag of green beans early this year. Looking back at my order history the price has been the same ($129) for the past four years, but now is $134. Not exactly a steep rise, but more than zero.
What's green beans? Coffee beans before they are roasted? If yes, do they not go bad if you store them for too long?
Green beans are unroasted, yes. They can last for a long time in storage.
“Coffee trade” is not monolith. There is commodity and specialty. The specialty side has been moving more toward just in time inventory for a while. It’s shocking how long the farm-to-processor(s)-to-distributors-to-roaster-to-brewer/consumer span can be and how many warehousing and exchange steps there are. Moving to just in time is quite disruptive for many business models; it’s not just this jump in price.
I roast around 15 pounds a year. I noticed prices have gone up 1-2 dollars/pound at my main supplier (sweet marias). The average is now about $8.5/pound. That is a price I'm still comfortable with.
At my consumption level so far the price changes haven't been a big deal. It could be that high end beans haven't been as affected - or maybe that was the 'brutal' price hike.
I also roast for personal consumption, about 25 pounds per year, and concur on the price increase. Just a few years ago green coffee was in the $6.50 range (and when I started roasting about 7 years ago, even $5), but as you said more like $8.50 now. I just did a relatively large buy (about 20 pounds) as a just-in-case because it's impossible to predict what the demented orange or the ketamine-stuffed Nazi will do.
"They don't know if they will be able to sell their product at the new prices," he said, also asking not to be identified. "Some people are going down".
That's surprising to me, considering that coffee is quite addictive. Will consumers really stop drinking it if it gets too expensive? Is there a really a strong correlation between coffee production price and the amount sold to end consumers?
>That's surprising to me, considering that coffee is quite addictive.
https://en.wikipedia.org/wiki/Caffeine#Addiction Actually no, it's not considered addictive. Yes, anecdotally you will find people that say they're addictive. Pick almost any subject and you can find someone that says they're addicted to it.
There are withdrawal symptoms, but dependency and withdrawal are defined differently than addiction. https://en.wikipedia.org/wiki/Caffeine#Dependence_and_withdr...
Inventory along the distribution chain will take quite some time to draw down before people are actually drinking less coffee.
As for caffeine, there are cheaper alternatives to coffee if you just want the caffeine.
> That's surprising to me, considering that coffee is quite addictive.
I'm not sure that it really is. You can build a physical dependence to caffeine, but in my experience there's no mentally addictive component. For a period of time I drank a lot of coffee and then stopped cold turkey, and the only effect was a couple days of physical unpleasantness. I now limit my coffee consumption to a max of one cup per day, and have no issues switching between coffee/decaf/no coffee on any particular day or for any arbitrary period of time.
My personal experience is that my withdrawal symptoms are not that bad. I used to pause my coffee consumption when the euphoria significantly diminished.
I hope someone can authoritatively answer the correlation question.
Withdrawal isn’t so pleasant from coffee. It was like a lite version of nicotine withdrawal for me. Headache, brainfog, lethargy. A few days of that and you are done in both cases. It took quite a lot of coffee to get that sort of withdrawal though. My current consumption of a cup or three a weekday isn’t enough to hit that. You need to be doing about 4 or 5 cups a day without skipping weekends for some time to get to that in my experience.
Recent NYT piece of interest:
Coffee Prices Are at a 50-Year High. Producers Aren’t Celebrating.
https://www.nytimes.com/2025/02/22/business/coffee-prices-cl...
I wonder how this affects small, subsistence farmers in PNG.
> Global coffee trade grinding to a halt, hit hard by brutal price hikes
The same joke was last year regarding cocoa. /s
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I'm not worried, US will take over Greenland and convert it to coffee plantations.
Really it’s an indictment of how poorly run Greenland is that such an agricultural paradise isn’t the leading producer of tropical produce. I mean the word “green” is right there in the name!
How green is greenland? Emerald green, arsenic green,uranium green, majory tailor green, just unbelievable green!
Yeah, greenland is mismanaged, luckily the perfectly ran united states of america will want to take it over.
Don’t worry after drill baby drill it’ll be Tropical Hyperborea
Before Global Cooling, it was Green. Sad!
https://www.antipope.org/charlie/blog-static/fiction/toast/t... - We can make it happen, just need a bit of genetic engineering and we will never be short of coffee again.
The link above is to a story called "Extracts from the Club Diary" by Charles Stross in his collection Toast.
https://www.antipope.org/charlie/blog-static/fiction/toast/t... - the collection in various formats.
Probably hard to make it taste good and more hardy at the same time
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Doctors providing healthcare to kids is a good thing.
Less good when it's impossible or very hard to reverse when there is a change of heart or regret after passing adolescence.
Is that a theoretical concern? Or do you actually know someone (personally, I mean) who has had such a change of heart?
One mark of a moral panic is the intensity of feelings people have about topics that are very distant from their actual experience. The kids say “touch grass,” but perhaps instead it should be “talk to someone actually involved.”
What is the goal of restricting examples to “personally”-known relatives?
Did people in 1943 personally knew people who got killed? Do I, as a gay person, personally knew the gay who was killed because he was crossing the main square of my city (France) which is under occupation by the muslims?
Do I care? Yes, absolutely. As a gay person, I have the electoral choice of either we become a muslim-majority country, either I vote for the French equivalent of trumpism.
Result: In my city, 35 out of the 35 core group of the extreme-right party are gay.
What about newborn circumcision for boys?
It really really isn't
Is it? How?
I think you mean narcotics. Without caffeinated adults, parenting will have to change
This is cause the harvests were fucked