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Show me the money !!

This is the blog post no-one wants to write. It’s about prices going up. Not on all coffee; over the year we have slowly, slowly upped single origin prices and I expect them to level out a little now. But blend prices and starter pack prices have become cut-off from their single origin friends.

To balance this out, I still think we are very competitive for similar quality coffees that are available in the market. There are some roasters that are cheaper, but I don’t think their quality is comparable to Has Bean; we pay great prices for great coffee, and from some of the best growers in the world. But here’s a few reasons why you will spot a small rise in the cost of our blends.

Dwindling yields from crops

Crop yields are on the slide. Climate change is playing its part here: places that grew coffee easily 10 years ago are seeing it get harder due to more unpredictable weather, and heavy rains, followed by long dry spells, are meaning the crops are suffering. And with suffering crops comes dwindling yields.

Ohhh, and leaf rust is affecting yields

Leaf rust, or ‘roya’, has been the biggest single factor affecting yields. This is particularly the case in Central America, and more specifically in El Salvador. This fungus spore attacks the plant by making the leaves of the plant fall off. If a plant has fewer leaves then it has a dramatic effect on the coffee production, because photosynthesis cannot occur (and the plant goes into shutdown mode). Some of our producers saw a 90% drop last year. Things seem to be getting a little better in some parts, but the less coffee you grow the more it costs you to harvest, and the more you have to spend on fungicides to control the roya — so the more the roaster has to pay for the coffee.

Quality issues

Both of these things — dwindling yields and leaf rust — affect quality. I won’t buy coffee that I don’t think is fabulous. This means finding fabulous coffee is harder, there is less of it and you have to pay more for it.

Increased competition

This is great news: there are now more coffee roasters than ever before. The downside is that the marketplace for great coffee is getting more competitive. To keep the coffees we are buying, in the quantities you and I need, we’re having to step up. This year we have made real strides forwards in our pricing to make sure we maintain the relationships we have with growers.

Currency issues

The dollar is 10% stronger than it was a year ago, and all our coffee transactions happen in dollars. I’ve offset some of this by buying currency, hedging and buying ahead (also dangerous, so requires prices to be set sensibly in contracts). But I make beans go brown; I don’t understand these markets 100%, so it’s all part of the buying process.

Take a look at the graph below that shows you 1 year (courtesy of xe.com).

 

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Unique Has Bean issues

We work with some unique origins that need special help. Sure, some people sell Bolivian coffee, but few put as much energy and work into it as we do. This year we funded some work in agronomic advice for the producers with whom we work. Sorry, we’re both paying for this, you and I, but I think it’s a good investment.

We have a range of staff at Has Bean, from people that manage wholesale right through to those who pack coffee. The coffee packing jobs are just as vital a part of the team as those managing operations, and I felt it was important that they be rewarded for the amazing job they do. So we have made the move, as of this April, to pay everyone the living wage or more, depending on their role, and in doing so make sure the awesome team get the rewards they deserve.

Ohh, yes, and I haven’t moved blend prices for over 4 years. This is probably the biggest reason. This is my bad: small, little jumps would have been better; no-one would have noticed a 10p rise per year, but now we have to make a jump. So all blends will have 50p more on them, and all starter packs to £22.50.

Sorry 🙁

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4 Comments

  1. It’s great to know how committed you are to all the people you work with. This and the consistently high quality of the coffee you offer, makes it well worth every penny.

  2. What Ian said. With you all the way on this – thanks for explaining what’s happening.

  3. Thanks for putting all that energy into it! Raising prices is always tough for a business, but the way you’re being transparent about it is great.

  4. happy to pay more if it means people at the lower levels are earning a living wage.

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