Topic: Farmer Pay Vs. The C-Market Coffee Smarter Expert: Jared Hales, Hacea Coffee Source Connect: www.haceacoffee.com • @haceacoffeesource on Instagram
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KEY TAKEAWAYS FROM THE POD
The C-Market (see below) is weird and not a direct reflection of actual farm costs or the value of a pound of coffee.
Farms are businesses. They need enough revenue and profit to cover expenses, pay employees, and reinvest in the growth (and excellence) of the company.
When someone buys coffee at a discounted rate or commodity grade coffee there is a farmer somewhere taking the hit.
If this is your first visit to our newsletter, we recommend following this episode of the podcast up with our recent show about the billing cycle of green coffee that follows the money.
From our May 25, 2021 newsletter featuring Kyle Rosa of Bluetail Coffee Grove:
During the show, Kyle references the C-market (coffee market) price, as have a lot of other guests. The coffee being bought and sold at this price is not actually physical coffee yet. It may not even be growing yet. It is just an agreement to buy coffee, called a Futures contract, meaning the seller is agreeing to provide the coffee at specific price later, and the buyer, often a coffee broker is agreeing to buy it at a set rate. Similar to the stock market, buyers and sellers of these contracts are hedging their bets that the price will go up or down.
Today’s C-Market price is at about $1.50 per pound which is seems really low to me, but is actually much higher than it was one year ago when it bottomed out at about 93 cents. On the commodities market you can essentially bet on what the C-market price will be.
Seeing those numbers makes me appreciate the craft and care that goes into the roasted coffee I’m purchasing locally especially from roasters or cafe’s, like Coffee Cycle or Steady State, who make the effort to purchase coffee at fair prices, directly from the far when possible. They are likely paying more than the C-Market price, but they are not only getting a better product they are also creating a fair market alternative that we can feel good drinking in the morning.
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Coffee Smarter Pro: Farmer Pay Vs. The C-Market.