mycuppa April 2015 Newsletter
Brazil - the real coffee powerhouse
The top producer, undisputedly, has a volume around 400% larger than the second largest producer, Vietnam.
Brazil dwarfs most other origins by around 10x, and such is Brazil's significance on the world coffee stage that weather conditions (and crop predictions) in Brazil directly influence the global price of coffee.
In early 2014, the prospect of severe drought in Brazil resulted in a massive 60% upward spike for the C-Index - causing raw coffee prices around the world to rise to 40% as speculation of a shortfall in Brazil's January/February crops would put further pressure on supply being unable to meet demand.
Brazil has a long history and well-established position in the coffee industry for very good reasons.
The sheer volume of its crop and relative consistency across various lots from season to season means that roasters can rely upon its cup characteristics in a way that few origins can match.
Coffee in Brazil is farmed on some vast plantations.
It is typically grown at lower altitudes than many other arabica coffees around the world, and the majority of the harvesting is performed by mechanical means.
This differs from different origins that rely upon higher labour content for hand-picking and sorting, generally in difficult high-altitude conditions.
Brazil has also perfected the processing methods whereby the sorting, pulping, drying and storage involve modern infrastructure systems.
All of the Brazil coffees we have been sourcing for the last five years are from estates that implement advanced processing methods, e.g. Ipanema, Monte Alegre, Daterra, Minas Hill, Carmo De Minas, etc., all employ underground wooden storage vats to stabilize the coffee at controlled temperatures before shipping to the clients.
This practice adds considerable value to the all-important "consistency" target we strive to achieve daily.
For other origins, we are often quite frustrated when new lots arrive from the same farms that cup remarkably different - every within the same season.
So, how did Brazil become so large?
Historically, Brazilian coffees were relatively cheaper on a comparative basis to other origins and with a consistent cup profile, they were an ideal choice for roasters.
This was the main demand driver long before the specialty segment's emergence.
What I am talking about here are the periods up until around 4 - 5 years ago when bulk coffee from Brazil was the essential "filler" in the commodity coffee industry's market.
It was common for large roasters to use up to 60% of the cheaper Brazils in their blends to meet specific price targets for their coffees.
In some respects, at the lower end of the market, this practice continues today, although the general trend is sourcing better qualities.
Brazil offered low or medium (balanced) acidity, plenty of body, good flavour and a chocolate finish in milk - making it well suited to espresso blends.
The Italian and US markets are large buyers of Brazils.
Brazil, like Colombia, Costa Rica and Kenya, has invested heavily in the specialty grade segment, and we see this in the explosion of available micro-lot offerings.
With distinct challenges in 2014, we dropped Brazils out of our blends and yet we still managed to purchase 14 different lots of Brazil specialty-grade coffees - or around 13 tons.
Some of these were scored at amazing 87-point grades and provided highly memorable cups.
The reputation of Brazilian coffees in the specialty segment has risen faster than any other origin in the last couple of years.
Brazil coffee has lost that "mild, bland, boring" moniker, and we are now seeing Brazil coffee cupping with fruit notes that rival Africans and having the most exquisitely balanced finish.
In April 2015, we secured a supply of some outstanding Brazils, which will form the basis of our offering for the next few months.
These estate coffees are superbly prepared to impeccable standards.
The typically neutral acid in Brazils is favoured by many black coffee drinkers, especially for espresso.
Going through the evaluation of these new coffees, I was trying to develop a new and improved SUPER BRAZIL for our store.
It was well overdue to lift the bar on the SUPER BRAZIL, and we have done a great job preparing a coffee that reflects and celebrates everything great about Brazilian coffee.
The simplest way to describe this coffee is to think of a Toblerone bar.
Smooth Swiss chocolate with a honey, almond and nougat finish.
Every time I drink it, I am left with a delightfully long and persistent aftertaste - making me want another cup almost immediately.
Try it here: BRAZIL SUPER.
Impact of falling AUD
We have published a few articles over the last 12 months to inform you of trends within the coffee market - particularly concerning pricing.
The last 14 months have seen a constant rise in the cost of raw arabica coffee.
In 2014, it was the Brazil droughts, Coffee Leaf Rust (Roya) in Central America and lower harvest yields in some African countries leading to supply shortages.
We also experienced commodity traders manipulating the market, buying more futures contracts than the available physical inventory.
Another unreported trend in the coffee market is the explosion of specialty segments worldwide - which means increased competition for quality lots.
In reality, the specialty segment does not track the global C-Index as sellers hold power and buyers (roasters) pay whatever price the seller asks.
In any market where demand exceeds supply, prices rise.
Commodity traders have a lower impact or influence on the current pricing arrangements as the market attempts to stabilize; however, the devalued Australian Dollar (AUD) has caused a price bubble as all quality raw arabica is imported and traded in US Dollars (US).
With a currency fall of around 20% since November, this has added cost to the landed price of raw coffees.
Unfortunately, there is no relief from the lower AUD - no hedging or opportunity to negotiate with importers, and the cost increases are making their way through the retail side of the market now.
Beyond the raw coffee pricing, it also affects packaging as, unfortunately, the local industry has been killed off, and the products are processed off-shore and traded in $US.
The key message here is a lower AUD = more expensive coffee.
Focus on grind
It would have to be the most reviled and misunderstood part of the entire coffee experience - the process of grinding coffee.
Our natural sense of naivety lends itself to thinking more about the actual ingredients (must be the beans) and the brewing equipment, such as espresso machines, and less about what happens to grind and dose.
Unfortunately, I still see way too much-wasted energy on equipment debates.
The truth is equipment rarely matters as a process, and technique contributes more to the quality equation than any special coffee roasting skills and beans.
All grinders retain grounds, and I've written many articles on this topic previously.
It has been pleasing to hear from our many mycuppa customers when they have called and spoken of the dramatic improvements in their quality and consistency once they used a bit of purging to flush out the stale grounds in their daily techniques.
