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Why is my gourmet coffee so expensive?

 
 
 
 

Did you know that green coffee beans are trading near their 16-year high?

Here's all the gory details in a spreadsheet from the International Coffee Organization.

For instance, in 1998 a blended pound of green beans from around the world purchased on the spot market, containing both Arabica and Robusta, cost $1.08.95

In January 2012 the same blended pound costs $1.89

At least that's lower than the high in April 2011 of $2.31.

Coffee roasters tell me -- and I talk with many throughout the say -- that these coffee prices are crazy.

Just note that your artisanal microroaster pays a lot more for the coffee than the prices above.  First, they purchase much higher quality coffee than what's on the spot market.  Second, there are usually many middlemen involved.  And third, they are much smaller buyers than say Starbucks, Keurig and Folgers, so they can't get the best prices.

There is a silver lining to all this for us as coffee drinkers.  Many roasters tell me that they've been forced to find new sources for new beans.  And that they are increasingly searching out unique coffees so that they can command a higher price in the bag.  Roasters are essentially forced to innovate to get higher margins.

A key problem that I don't fully understand is why the actual growers in Colombia, Brazil, Sumatra etc. claim that they're being paid as little as ever for their green beans.

That's a topic of a later blog entry.

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REVIEWS & COMMENTS

  • IF ONLY

    Wakeknot | Fri, 02/10/2012 - 22:58

    this meant that the farmers were getting more for the coffee I would not mind at all paying more. If it is going to middle men who are not growing it and not roasting it, it makes me less happy.

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  • INTERESTING

    EricBNC | Mon, 02/06/2012 - 12:24


    prices for good coffee have been comparatively high long as I can remember - even when coffee was under $2 a pound.

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  • I REALLY HOPE PRICES ON

    hoonchul | Mon, 02/06/2012 - 01:46

    I really hope prices on roaste won't go up too much. I don't think I can go back to buying beans from amazon.

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  • TOUGH PROBLEM

    jbviau | Sat, 02/04/2012 - 01:17

    And I'm sure the roasters don't fail to notice that their profit margins would be a touch higher if we all bought directly from them. However, by selling through ROASTe they gain visibility, I'm guessing, and reach more customers. Scott, I'm sure you feel strongly that the buying arrangement we all enjoy here is "win-win"; I'd love to see a future blog post addressing this issue, as I've been thinking about it lately.

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  • MAKE SENSE THOUGH

    samuellaw178 | Sat, 02/04/2012 - 00:25

    More and more people are noticing and starting to enjoy gourmet coffees, it's no wonder that the good coffees are rising in price. More demands= higher price in general. But I sure hope it won't increase too much!

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  • CRAZY PRICES!

    Son Ton | Fri, 02/03/2012 - 22:27

    we all know that specialty grade coffee is much more expensive but up to a point the price are really getting crazy. I think it will hurt the industry more if prices are continue to go this way.

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  • OH I KNOW, I SAW SOMEONE

    intrepid510 | Fri, 02/03/2012 - 17:47

    Oh I know, I saw someone complain on an Amazon review that the beans being priced at 14 dollars for a 12 oz bag was too expensive. And I think that if you want to have something like folgers then go ahead and buy your poor grade that was bought at close to the spot market. I think I will stick with roasters that are willing to change that higher prices for better coffee is a good thing.

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  • PREMIUM PRODUCTS

    avaserfi | Fri, 02/03/2012 - 17:13

    There is a level of craftsmanship that goes into certain products for which we pay a premium. Most people would scoff at the prices many members of Roaste pay for coffee, but the same could be said for the person who buys low temperature pasteurized milk, heritage fruits/veg or meat etc. Factors beyond the initial cost of the raw item such as skill are incredibly important and worth paying for, in my opinion.

    That said, I didn't realize how cheap some of the larger companies pay for their greens. Eye opening.

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