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Topic: world coffee market (11 msgs / 409 lines)
1) From: Ted Kostek
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From the "Re: problem with St Helena" thread:
[snipped Charlie's doomsday scenario of bad coffee for all]
As long as a market for premium coffee exists, there will be folks willing
to produce for it.  At SM, we pay $4-5 per pound, while 2 pound cans in the
local grocery are about $6.  This extra 30-60% price will motivate some one
to produce superior coffee, even if it's at lower volumes and even higher
prices.
I don't like the idea that I get cheap coffee b/c some third world folks are
going bankrupt, but it's true.  I drink fair trade coffee when I can, and
I've ordered some fair trade coffee from SM.  Fair trade aside, coffee
prices aren't going back up until the supply falls, in other words until
folks are driven out of the business.  I'm sure that we'll lose a lot of
quality producers, but it's not reasonable to think the market would let all
the quality stuff go away.  Not when that extra profit is available.  The
coffee producers will be looking for a way to differentiate their product,
and having these specialty coffees is a great way to do it.
I haven't researched this issue in depth, but one of the news reports on NPR
interviewed a guy from Starbucks who claimed that a big part of the problem
was that the market didn't adequately measure quality.  I find this hard to
believe, but apparantly the Vietnamese robusto beans (which frequently
contain twigs and pebbles) are not sold differently than quality arabica
beans.  If this problem were fixed, everything would probably work out much
better.  Bad beans would be cheap, good beans would be expensive.  The price
system is at the heart of the free market, and if that's broken...
Maybe what we need is some kind of uniform coffee grading via some world
wide coffee association.  Such a system would ultimately benefit everyone,
although there would be some unhappiness for a while as people tried to get
their beans graded higher than they deserved.  I'm sure there would be loud
claims of injustice when cheap beans got down graded.
tmk
--
Ted Kostek
765 494 2146 (desk)
765 494 1489 (engine room)
765 494 0787 (fax)
"Always keep in mind that your own resolution to succeed is more important
than any other thing."  Abraham Lincoln

2) From: Ted Kostek
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Thanks, Dan, for the links.
Here's an interesting one that you might want to check out:http://www.scaa.org/industry/survey/Sustainable_Coffee_Report_NA.pdfIt's a 32 page report looking at a segment of the specialty coffee market
(shade, organic and free trade).  I just got it, and so I haven't read it
yet.  I'm also looking at some of the links you suggested.
tmk
--
Ted Kostek
765 494 2146 (desk)
765 494 1489 (engine room)
765 494 0787 (fax)
"Always keep in mind that your own resolution to succeed is more important
than any other thing."  Abraham Lincoln

3) From: Ted Kostek
Dan said:
<Snip>
When ever possible, I prefer market based solutions.  Considering that
specialty coffees are 17% of the market, it seems reasonable to trade them
on their own, although perhaps smaller categories wouldn't be handled
efficiently (Kenyan vs Sumatra are probably too small to be individually
traded).
Is there a move afoot to achieve this?
In the future, I'm going to make a greater effort to get free trade coffee.
I'm also going to join the SCAA; they seem to be working for long term
quality coffee.
tmk
--
Ted Kostek
765 494 2146 (desk)
765 494 1489 (engine room)
765 494 0787 (fax)
"Always keep in mind that your own resolution to succeed is more important
than any other thing."  Abraham Lincoln
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4) From: Ted Kostek
I'm my own thread.  Neat!
Some one pointed out to me that I didn't mean "free trade", I meant "fair
trade".
Sorry for any confusion.
tmk
--
Ted Kostek
765 494 2146 (desk)
765 494 1489 (engine room)
765 494 0787 (fax)
"Always keep in mind that your own resolution to succeed is more important
than any other thing."  Abraham Lincoln
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5) From: John Abbott
Well I guess I can turn off my search engine now on the free coffee :O)
John - Celebrating my birthday with LOTS of ISH coffee. 
On Tue, 2002-08-27 at 11:27, Ted Kostek wrote:
<Snip>
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6) From: Gary Zimmerman
Ted Kostek wrote:
<Snip>
What I gathered from reading Uncommon Grounds was that any time an 
international "organization" of coffee folk is tried, it devolves into 
national politics and maneuvering to get one's own countrypeople the best 
coffee prices.  I'm not a student of economics or markets, so much of the 
book was lost on me, but it just seemed that any time the coffee industry 
(or any particular arm of it) tried to organize, bad things ultimately 
happened.  Including wars.  Seems coffee is (or was) pretty darned 
important to some economies.
-- garyZ
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7) From: Charlie Herlihy
 Feliz cumplianos  Juan!  I think that with "lots" of St. Helena
coffee you probably couldn't afford a cake and candles, but I
know what I'd prefer on my birthday.  Many many more, old chum
Charlie
--- John Abbott  wrote:
<Snip>
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8) From: John Abbott
Gracias Amigo! I figured the ISH was in the same category as those wines
we tuck away for special occasions and so I un-vac-ed a bag and I've put
away almost a half pound of it today. I'll probably be up all night -
but I can roast or something constructive.
John - hoping this shaking is coffee and not old age catching up :O)) 
On Tue, 2002-08-27 at 13:58, Charlie Herlihy wrote:
<Snip>
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9) From: R.N.Kyle
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Happy Birthday John. Hope you have the best day ever. Sounds like you =
started it out right, St. Helena, is that what the rich folks drink? LOL =
Have a great birthday.
Ron Kyle
a coffee roaster from South Carolina
rnkyle

10) From: John Abbott
Thanks Kyle.  Not rich if you own any ISH - you spent it all on the
beans :O)   It is my special occasion coffee and this is special enough.
On Tue, 2002-08-27 at 19:47, R.N.Kyle wrote:
<Snip>
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11) From: Dan Bollinger
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From what I've learned there are 5 bean classifications.  Specialty (or =
Class 1) being the highest grade.  But in the market place this is =
reduced to three pricing classes all based on one price.  This creates a =
leveling effect and high quality beans can't be traded based on their =
quality.  When the cost of sh*tty beans or a glut in the harvest of =
Exhange Grade (Class 3) drops, the price of quality beans drops, too!  
Exchange Grade (Class 3) beans are quoted on the NYCE, then a discount =
is given to Class 4 & 5 beans.  An added percent is given to Class 1 & =
2.  If this is true, then this is part of the problem.  If the New York =
Coffee Exchange doesn't discern quality, then this isn't being passed =
downward along the supply line.  
Vintners solved this problem a long time ago by assigning 'appelations'. =
 Wine made from grapes in certain, very carefully designated areas =
command a premium price.   This way, the growers got a better price. 
What I suggest is the SCAA work with the NYCE people to add an =
additional price to Class 1 beans, or better yet, trade the Specialty =
Grade separately, and let market demand control that price.  http://www.binews.com/"If you aren't part of the solution, you are part of the problem."">http://www.coffeeresearch.org/market/coffeemarket.htmhttp://quotes.ino.com/exchanges/?r=NYBOT_KChttp://www.binews.com/"If you aren't part of the solution, you are part of the problem."
Dan


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