Wednesday, April 26, 2006

third and beyond

so i asked a question at an online coffee forum i haunt that i thought i'd posit here. what is the future of the specialty coffee industry? more to the point, what product or small set of products, or small but significant mind shift is taking place right now in the industry that will reverberate and echo deafeningly, defining this industry in the five, ten, twenty years to come?

here are my humble submissions, in no particlar order.

while one would be tempted to say "cup of excellence" as a major leap forward for speccoffee, coe is the manifestation, not the root. it is the vehicle for a groundswell that, i believe, will overtake and swallow any one such program. that groundswell--maybe ten years off--is the emergence of highly branded coffee, a la the wine industry. the beauty of coe is that it is beginning to begin to shine the spotlight on heretofore obscure farmers and farms for the first time. everyone knows kona and jamaica blue mountain and the cat poop coffee. but now a fazenda santa ines will shine and burn bright for a while, maybe recapitalizing on that new found glory next year and building a dynasty, or maybe not. and then guatemala's winner and honduras' winner and nicaragua's winner will join brazil's in global awakening of coffee as other than commodity and we in the industry will hold our breath and hope for more. because you see, we don't all have to serve a cup of excellence coffee to benefit--even if indirectly--from the fruits of that global awareness. and, unlike fair trade, strong branding among coffee farms/farmers is the ultimate little guy booster.

clover. again, tempting as it may be to trumpet this piece of equipment as revolutionary, it may be more prudent to say that clover has opened the door to a new phenomenon: coffee by the cup. no one thinks twice about paying five bucks for wine by the glass--thinks, perhaps, that five bucks per glass may actually be beneath their standards in many cases and opts for the seven or even eight dollars a glass selections. why not coffee? now, granted, this $8000 machine is currently the en vogue piece of equipment to have to offer such caffeinated delicacies. but more will come. clovers and clover like knock offs will get smaller and, dare i dream it, even faster, and one day coffee bars will be noted for their myriad coffee selections just as haute restaurants are touted for their vaunted, varied and voluminous (consider the alliteration!) wine lists.

exclusive contracts. much as i may be in the minority on this line of thinking, i think coffee companies holding exclusive contracts with specific farms is a bad trend, but a trend nonetheless. there has been much rumblings just beneath the surface about fair trade coffee and the unfairness is begets in some corners of the industry. and recently it was publicly announced that a major player in the indie coffee scene in america, intelligentsia coffee roasters, was opening a third chicago cafe that featured prominently a marketing tool known as 'direct trade.' the long and short of it is that intelligentsia now has a major outlet to leverage its size and clout in the industry by highlighting coffees for which it carries exclusive contracts. now granted, intelligentsia is a major player that wants to use their powers for good and not for evil in the industry. and granted, they source some sick, sick coffees that are just mind blowing. and granted yet further, they are almost certainly paying top dollar--well on par if not exceeding current fair trade baselines--for these 'world exclusives.' those are all to the positive for intelligentsia and the the short term and on the surface. i applaud the step away from communistic mentalities such as fair trade minimums. but a world exclusive coffee going to only one company hurts the industry in the long run. why? because it opens the door to market creating and market creating opens the door to market manipulating and before long we have the equivalent of "c" but with speccoffee. if i walk up to a coffee farm and say, 'hi, i'm aaron, i'm the owner of the brown coffee company from san antonio, texas, and i'd like to buy your coffee;' and at the same time doug zell from intelligentsia comes up and says the same thing (but sub intelly and chi-town for brown and s.a.), who do you think the farmer is going to give preference to? why, intelligentsia, of course, because they have the reputation and the dollars. but what's wrong with that picture? just because i don't have the rep doesn't mean i don't have the dollars and don't intend to use them for the benefit of the community. that's where an open market, even auction, system such as coe is so beautiful. the browns of the world can stand toe to toe and slug it out with the green mountains, or small axes or even big green herself. you got the dollars, you got the coffee. and then the coffee wins. direct trade benefits one party most: the buyer. a level market benefits all parties: growers, buyers (including roasters, retailers) and customers.

i'm not down on intelligentsia. not in the least. their reputation is stellar and well deserved. their bravery to push the envelope and mature the conversation beyond parochial fair trade type solutions is higly laudable and worthy of respect. and maybe their direct trade offerings won't be enough to warp the market. sbux has been making exclusive contracts independent of "c" for a long time...and paying at or above fair trade prices since way before fair trade hit big, too, i might add. maybe they have to do that. and maybe that shapes the market in a way smaller fish like intelligentsia and even little minnow bait like brown can only dream. but i just don't see exclusivity being a benefit, in the long term, for the overall industry. not unless, of course, there were absolute and complete transparency up and down the entire chain; and there were concrete, visible, and superior benefits evident for pickers and farmers; and if the contracts were paying substantially higher than current baseline programs like fair trade. then and only then could this step be considered a good FIRST one toward bettering the overall industry. (and maybe intelligentsia is doing that and i should shut up and not use them as an example.)

there are more industry shaping things on the horizon. and more to come from me, here. but for now, chew on that and give me your thoughts.

for now, i leave you to contemplate that i am contemplating not carrying any sumatras in my meager lineup for the now because i've now sourced two sumatras from two reputable buyers and have been dismayed and appalled at the number of defects i've been seeing in the greens and in the cups. is this residual still from the tsunami? have i just hit a couple bad lots from otherwise spot on buyers? in my short time buying greens i don't recall seeing it that way. something to ponder....


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