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Racism, Coffee & Transparency!

Racism, Coffee & Transparency!

Edit: Due to the sensitive nature of this subject, we decided to take the time to reflect on the feedback we received on our original post in order to ensure that we are listening to our friends in the black community and using the proper language to address the injustices faced by people of color. Our goal for this piece is to provoke thought around the subject of coffee history, the role white supremacy plays in our industry and what consumers should look for in supporting companies who exude transparent buying practices. 

 For us, this is an ongoing conversation both internally and externally. When we started to write about this topic, we realized that we still have much to learn, so our dedication to ourselves and to our customers is to be crystal clear- black lives matter. We also want to highlight the importance of transparency in the supply chain, a system built on colonialism & white supremacy and what consumers should look for in the companies they support. 

In our last blog, we covered some of the challenges, fears and setbacks of managing a roastery and cafe through the pandemic. The feedback we received from our friends and customers helped us realize the importance of communication and transparency which is now leading us to make these updates and post a more frequent thing. 

Today, our country is arguably in the midst of two pandemics. One is viral while the other is human. The recent Black Lives Matter protests, in response to the murder of George Floyd, have led me to reflect on the very industry I work in and the way we treat people in the supply chain who are vulnerable and stand to be most affected- the coffee producers, who are mainly people of color. 

Around the globe, there are an estimated 25 million coffee farmers that depend on coffee for sustenance and over 2 billion cups of coffee sold per day. Global coffee production varies from year to year according to weather conditions, disease and other factors, resulting in a coffee market that is inherently unstable and characterised by wide fluctuations in price. This price volatility has significant consequences for those who depend on coffee for their livelihood, making it difficult for growers to predict their income for the coming season and budget for their household and farming needs. 

What exactly is the C-Price?   

In the summer of 2015, Fair Trade USA and Cornell University teamed up to collect data from producers in central and south America and the result of this study concluded that the average coffee farmer in South America required a minimum price of $1.25 to $2.40 to just cover their cost of production. For context, as of this writing the C-Market price is at $1.02 per lb., a price that hasn’t fluctuated much since 1973.  

The New York C price is the reserve price for Arabica coffee traded by Intercontinental Exchange (ICE), a large international commodity trader based in NYC. This price assumes that coffee is a homogenous product (i.e. a commodity like wheat, corn or cotton) and is informed by supply and demand economics. Most Arabica is traded either via this Exchange or priced in relation to the current C-market price. The C-price is notoriously volatile and affects all coffee producers globally. It is currently exceptionally low, as a result of speculative trading and an excess of global supply of Arabica. C-price is internationally communicated in USD/lb. and refers to coffee that is milled and ready for export.

How does Specialty Coffee get it right and what do consumers need to be aware of?

In the past few years, there has been a growing trend among a few specialty coffee roasters who are championing purchasing transparency at every level. Prior to publishing their data, the lack of transparency and available information in the supply chain has historically meant that consumers are unaware of how much the producer actually ended up getting. Because of this ambiguity, many have capitalized on the low market price all the while bolstering their brand as a specialty brand, which is not only false but dangerous to the future of coffee. 


To create market distinctions, a growing group of quality purveyors across the country are publishing their prices to educate consumers on how we are collectively developing new benchmarks on sustainable coffee pricing. Of course, while there is never a shortage of good intentions, there are still a myriad of challenges and questions to transparency in the supply chain. For example, without context, publishing the prices is somewhat arbitrary without taking into account a producer’s Cost of Production. Suppose that a roasting company published their F.O.B price (Free on Board), which represents the price of milled coffee in bags at the port, only tells one side of the story but doesn’t account for all of the costs accumulated beforehand. This is why our partners at Azahar Coffee in Colombia have published a green coffee buyer’s guide called “Sustainable Buyers Guide.” By gathering this data, Azahar is identifying the prices required in order to: 

  1. a) meet the poverty line
  2. b) meet the minimum wage, and
  3. c) have extra to reinvest in developing the farm. 

This data provides a useful and accessible benchmark for coffee buyers to determine the farmgate price, and from there the FOB price, which includes Azahar’s margin and processing costs. With this type of information, we can without a doubt offer prices that are sustainable with data to support it. 

What does publishing these numbers look like?

Every company is different, and many are still weary of publishing their costs mostly out of fear that customers would use this information to negotiate a lower price or perhaps become an advantage for competitors to poach accounts. These are legitimate concerns that we discussed internally but felt compelled that in order to move the industry forward, we have to collectively share this information. In doing so, it protects both producers and consumers, brings integrity to the industry and allows for a continual check of motives while allowing consumers to spend their money on companies that strive for a fairer, more sustainable price. 

Here is a link to an example of one of our contracts from Beneficio San Vicente  in which logistics and financing were done by a green coffee importing company named Olam Speciality Coffee. The prices in this contract are F.O.T. which stands for Free on Truck and is the price that we are required to pay for the transport of our coffee to Chicago. 


And here is a link to an example of how this information is carried over to our transparency reports. Take for example producer Denis Enamorado, from whom we’ve been buying directly since 2016. Each of our releases comes with a QR code that shares farm story and pricing information, which we believe is crucial to establishing the most equitable partnership between Denis and Metric while also helping to  educate consumers on the importance of transparency.

Conclusion

As roasters, we have a responsibility to acknowledge the past as well as understand and communicate how the low C-Price disproportionally affects people of color. For consumers, we encourage you to support roasters who are open to sharing data and are committed, year over long-term buying partnerships with producers. While in practice, this is a step in the right direction, we have much to learn and this is by no means a solution; just the step in the right direction. 
Last- we want to encourage you all to develop a passion for learning more about how coffee is produced and how you can support companies that make it their mission to be equitable, transparent and dignified across the supply chain. Here are a few things for you to consider or talk to the roasters you support. 

  •  Ask for supply chain traceability reports. Companies who buy coffee directly from small farms should have easy access to that information and willingly share it with their customers. 
  •  Support high-quality, smaller roasting operations. Now more than ever, many companies are established and funded by big money, so checking out who’s behind the coffee you're buying speaks volumes about their practices.
  • Get information about the milling and exporting operations. The notable ones have a good reputation with producers and importers and are always open to sharing how they work. 

 

 

 



Covid-19 and how we have managed operations through it all.

Covid-19 and how we have managed operations through it all.

Hello friends.

It’s been a little while since we last blogged, but as you can imagine, we have spent the past few days, weeks and months adjusting on the daily and doing our best to stay healthy and grounded. We wanted to take this opportunity to share a few updates and how we as a company have navigated though these uncertain times. First, before I dive in, I would like to personally give my deepest thanks and gratitude to our amazing staff, who managed to safely come to work daily to ensure that our orders were being fulfilled while always having a positive outlook even when there were days that seemed like the world could not possible get worst. Thank You!

So, at the beginning of the pandemic, like many of us I’m sure, we felt a slurry of emotions and among them where thoughts like “is this real?” or “is the world ending?” Of course, we couldn’t help but to feel like there is an apocalyptic tone to what’s happening in the world, so that confusion mixed with not knowing how we could possible move forward left us feeling shell-shocked and unsure if we could even exist after all is said and done. As a small, independently owned company, we depend on the support and patronage of our customers which means, we do not have access to surplus cash to weather the imaginable or in this case, the unimaginable so that fear was very real for us and sobering reminder that we needed to take a hard look as to how we’re doing business. As a small roasting company, Metric was founded on the principles of bringing humanity and honesty in everything we do. Of course, by virtue of being “humans” we too fall short in many ways, but our goal and mission is to source and roast quality coffee from producers we know and pay the highest premium possible. For many years, this has been our “call to action” and I doubt that will change much, but merely saying that, without finding ways to show the public why buying sustainably can truly make an impact with clarity has shown us that we have a lot of work do on that front. The word clarity now brings me to transparency. Anyways, let me get back on track here before I veer off the rails. Once the city announced the closures, we learned that our business was deemed essential which meant that we could move forward provided that we follow strict CDC guidelines. After a long discussion and the possibility of shutting down operations indefinitely, we chose to move forward by first staggering schedules, coordinating daily employee pickups from home, stocking our warehouse with all of the PPE we could get our hands and enacting bi-daily sanitation procedures on all of our work spaces. For our café, which is a 400 square foot addition inside our roasting operations, our biggest concern was having the public in close contact to our baristas, so the decision was quickly made to utilize our front doors as a purchasing point, which would undoubtedly change the way do service but letting customers in was not a risk we were wiling to make. Still, once we shifted to our new service, even with the fear of experiencing a considerable drop in sales, which we initially did experience, we noticed that even with having less visitors at any given point, they for the most part where very respectful in visiting our café wearing mask and gloves and from the feedback we have received from our staff, most of our guests where patient in the slightly longer service lead-time and very grateful to still be making coffee.

Now, let me pedal back a little bit and talk about what felt like a “punch in the gut!” The core of our business lies in the roasting we do for others which means, we have built Metric through local and regional partnerships which were no longer in operation. What this meant is that our volume dropped significantly in the beginning and not knowing what’s next was first a very alarming feeling. Of course, once we had time to put everything in to perspective, we quickly realized that there was more at stake here than our business. Our business can close and be sold off, but lives cannot be replaced, so accepting the loss and finding ways to keep moving definitely showed us how resilient we can be, but this resiliency would not be possible without the support and hard work of our amazing staff. So, here we are, more than 80% of our business is gone overnight and we aren’t sure if we are going to be open in a few days, but as our story goes, we decided to safely move forward and from one week to the next we experienced a pleasant twist that we never could have imagined. From one week to the next, we saw an increase of online sales through both our one time purchases, subscriptions and our nights in shinning armor Trade Coffee which have committed to buying not only our coffee, but coffees from some of the best roasters in the country. Today, most of what we do is retail with a few partners slowly and safely making their way back to service, so while we are still mentally feeling like bracing ourselves for the other shoe to drop, we have now learned an extremely valuable and humbling lesson in      the resiliency of our small but mighty company. So what’s next? Prior to Covid-19 we could say “visiting producers” or “opening a second café!” but given the way things are, our objective now is to continue to operate safely and roast delicious coffee.

The last thing I want to leave you all with is- we want to thank you all for supporting us through our online shop and café- without your support and patronage, it would make it nearly impossible to cover our payroll, pay our employee health insurance or even the rent. We are not lost at how fortunate we are which is why, I will be following up with two more posts; one will cover the topic of the effects of COVID-19 and what the current outlook is from our producer partners and two, a personal essay on racism within the Specialty Coffee market.

El Brujo's Destiny

With X currently in Guatemala and heading down to Honduras in the coming weeks, we thought it was time to post a little op-ed he recently penned about an update from one of our closet producing partners and friend, Benjamin Paz.