The Coffee Roaster's Tricky Road
20 August 2015
After returning from the New Zealand coffee awards last year where, with a panel of over a dozen tasters, we evaluated over three hundred coffees in two days. It is always a daunting task to try and do justice to so many roasters' coffees in so few days.
One of the categories that stood out was the Single Origin coffees. The roast profiles used for these unique and varied coffees seem to have improved. They highlighted processing methods like OCR (Operation Cherry Red) for instance. All these single origin coffees were tasted using specialty cupping protocols and many Yirgacheffe and Geisha coffees shone through in particular.
With the lighter roast profiles, the orange marmalade fermented fruitiness of some Ethiopian coffees was often profound, as was the delicate contrasting bergamot of the geisha variety. The subtle nuances of these fine coffees was highlighted by the lighter cupping style roast profiles.
There were some English people there who had just arrived in New Zealand and who were used to the lighter London roast style and had trouble adapting to a more mature espresso based market like New Zealand. They had with them a recent guide to London cafes for 2014. Out of the 150 or so cafes listed, over 80% were less than three years old. The majority of coffee roasters were also very new players. Square Mile had the biggest market share with more than 20%, which was more than the next two rivals, Union and Climpsons put together. This is a much delayed explosion of new cafe operators similar to that which occurred in Australia and New Zealand twenty five years ago. The recent explosion of coffee roasters in Australia, New Zealand, London and for that matter all over the globe, is simultaneous though.
The appointment of Cosimo Libardo, the former CEO of Nuova Simonelli, as the new Managing Director of Toby's Estate coffee roasters, is indicative of an exciting, complex and dare I say, fluid global coffee market. It is also in some ways recognition of the maturity of the Antipodean espresso based market too. I have no doubt that Cosimo, with his global coffee experience, can help make Toby's a global coffee brand powerhouse. Coffee roasters need to keep on their toes to keep up with new trends.
I remember visiting Toby just after he had started roasting in his mother's garage in Woolloomooloo about fifteen years ago. He pulled back the scraping doors and there stood a tiny 5kg green Turkish roaster much like the one I had started out with almost twenty years before. Since then Toby has gone on to become a great success. The fact that an Italian executive from a global espresso machine company is moving to Sydney to run a global coffee brand that started out roasting in a tiny inner city Sydney home is a great success story. If Toby can do it, anyone can. Well actually it is a lot more tricky than that, as I'm sure Toby would attest.
There are a lot of pitfalls to avoid and a lot of changes and tricky turns in the road if you want to roast coffee successfully and there are plenty of people giving it a go.
For instance, there is the New York C price to contend with. Particularly at the moment, coffee prices for roasters are skittish to say the least. This is being driven by the global increase in coffee consumption evidenced not just by the intensity of the Australian and New Zealand coffee roasting scene, but also by the exploding cafe scene in the UK, USA and for that matter Asia.
Due to this long term increase in consumption, there are now minimal green coffee buffer stocks held anywhere in the world on the open market. With global supply dependent so heavily on Brazil, any apparent mishap there immediately impacts the global price reflected in the New York C Arabica futures. A few short months ago, this closed at USD$1.89 per US pound. That is roughly the equivalent of AUD$4.73 per kg. It was up over USD$2.00 per pound for most of 2011 and has been bouncing around between USD$1.80 and USD$2.00 per pound for most of 2014. This is almost double where it was towards the end of 2013.
We haven't seen the end of this volatility in coffee prices. It is possibly the biggest threat facing coffee roasters today, unlike when Toby started out fifteen years ago. It's actually good for coffee growers though. They will make more money. It has now started to filter through to cafe owners pricing. Some wholesale prices are nudging AUD$40.00 per kg for many specialty coffees. For the really popular coffees that dominated the recent New Zealand coffee awards, like Yirgacheffe and Geisha, expect to pay more. The demand is only increasing and the supply is already not keeping up. These increases in prices will only be further exacerbated by any problems Brazil may have with their coming harvest. And even though Brazil had recent rain to set next year's crop, if the market is this skittish so far out from a harvest, the roller coaster ride for new roasters, unlike the previous decade and a half, is set to have lots more big ups and downs.
When I was a twenty something coffee newcomer, there was a bare handful of small coffee roasting businesses to be found in Sydney, in stark contrast to the current abundance of new roasters throughout the world and Melbourne. But if it had not been for this explosion in interest in better coffees and new roast profiles, neither would there be the need for a unique coffee roasting business like Espressology that doesn't have a street brand like Toby's and just enables others to access roasting equipment and expertise as if it was their own. There simply was no demand for a bespoke contract coffee roaster thirty years ago.
But with all this change, some things still remain the same though: Australian customers like good coffee.