We’re nearing the end of September and fresh harvest coffees are finally arriving to market. It’s about the latest we’ve had new crop coffees land in our short career(s) - usually fresh coffee hits market around August. So, to say it was a challenging harvest is putting it lightly, because so many unique problems presented themselves all at once.

For starters, the borders were closed going into the 20/21 season and migrant labor for harvesting cherries was a big question mark - growers were uncertain if their crop would be collected and feared that much of their fruit would be lost, fallen to the ground. Later, new protocols were put in place by the government and iCafe in order to receive migrant workers and run processing stations; requiring more money and effort of farmers. With everything going on, a lot of farmers chose not to take on much risk and did not process as many micro lots.

Across pretty much the entire country, the harvest was a full month behind in ripening and the rain season set in early during April - leaving a huge impact on high altitude farms which were still being picked at the peak of their harvest. The harsh weather greatly affected the current crop’s drying as well as the coming crop’s flowering - it’s already been expected to have less production, especially in higher altitudes. Producers are reporting that they are at half of their typical yield in farms at 1700masl and higher. That is scary, because its where most of the spectacular micro lots come from.

This last season, Costa Rica was also heavily affected with an extremely common secondary defect of partial blacks better known here as “granos manchados” or “chasparria”- literally translated to stained seed. The defect hurt yields for nearly every producer and is extremely difficult to sort out appropriately. We are still looking into the extent and precise effect that these beans cause in the cup as well as what exactly results in the defect, since there are various theories.

Some believe that the defect comes from the plant not absorbing enough nutrients - further saying that the excessive rains are to blame for washing away fertilizer and saturating the plant. Also related to over watering and environment is the commonality of a disease caused by a fungus named, Anthracnose. The fungal disease causes dark lesions on leaves, branches, trunks, and worse of all the fruit, stunting its growth and life. Many believe this common fungus to be the culprit behind the defect. Even now, larger mills and producers are already receiving the very first fanegas of fruit for the 21/22 harvest from lower altitudes - if you can believe it. We’re already being told that these first pickings are still showing signs of many partial black beans.

This exporting season, shipping lines often canceled carriage which lead to delays in exporting. Discharge ports are backed up and coffee warehouses are slow to strip containers. Roasters are waiting to re-stock with incoming coffee and reserves will be used quickly. There is simply not a lot of coffee in the world market right now and we are sure that you, reading this, are feeling that some way or another. It’s well known that Brazil went through a dreadful frost - adding to the low supply already being forecast across the producing countries.. The biggest players in the global market need more coffee from Costa Rica and the rest of Central America to make up for the low supply and are going into the harvest with extremely competitive prices for fruit.

There is strong speculation in the streets about what the going price will be for a fanega of fruit this season (fanega = ~46kg green). We don’t know for sure what the standard price for a fanega of fruit will be when the harvest hits, but folks are talking about around a 20-25% increase this year. The price for a fanega of decent quality fruit has been hovering around 90,000-100,000 colones or about US$150 for years. The big multinational players are already contracting fruit with farmers for 120,000 - 130,000 colones or about US$200.

Due to the prices being offered, or being expected to be offered, there may be many micro wet mills that are tempted to simply deliver their farm’s fruit; rather than put in all the effort and risk required to produce micro lots. You wouldn’t even need to collect the fruit very well when delivering it to multinationals - again, making it cheaper and easier than harvesting and processing micro lots. At the same time, the cost of production is also rising on farmers as products, labor, and equipment prices go up.

Most of the micro mills that we work with are expecting less coffee, but still want to provide enough product for their existing relationships. In many cases the producers would like to purchase fruit from family members and/or neighbors to make up for their loss, but this year it’s going to be extremely difficult to pay more for well harvested fruit than the multinationals and/or cooperatives. While they may be willing to pay more for fruit they’ll have to reflect the increase in their selling price. Typically specialty producing wet mills would buy a fanega of fruit for a differential of around 115,000 colones, and now they may have to shell out more than 130,000 colones - that’s a US$25 per 46kg or about 25 cts/lb increase. Multinationals are also able to pay cash at the time of delivery whereas micro mills may need to make payments back to the grower overtime or take out loans which come with interest payments.

The producers which have a history of purchasing fruit from other growers are doing their best to remind the farmers that they were paying well for coffee when the cooperatives and multinationals were not giving out these bloated prices. That they will continue to be there when the larger mills return to paying lower prices for the fruit, but that they rely on this coffee to keep their relationships going. However, it is looking to be very difficult to convince growers to take less for well picked coffee than top dollar, instantly, with less effort - even considering their existing relationship.

Do you see how the c market price of coffee does indeed have an impact on micro-lots? Some may have believed that specialty coffee prices aren’t related to the c market price, or that micro lot prices are more stable, because the differential is so much higher; but there is absolutely an effect caused by the fluctuation of the commodity price and supply. When better prices are being paid for the fruit it is good for those who grow coffee, but it makes things more challenging for wet millers, exporters, roasters, and consumers. The cost to buy fruit fit for specialty coffee gets very close or even surpassed by that of conventional coffee. In order to make the same profit wet millers will have to raise their prices with the fruit. Producers want roasters and buyers to know that although prices will probably be going up - they are not taking advantage of a situation, simply doing what they have to to stay sustainable.

So now, the question is what does one in our position do to support coffee producers, roasters, and influence more specialty coffee production this coming harvest. The simple and quick answer is simply, commitment. While most farmers are reporting about a 30% decrease in yield they do still have coffees that they may later choose to deliver rather than process. It is more likely that a producer will process their fruit as a micro lot if they already have it sold than wait to see how good or bad the price for delivering turns out to be. Having prior commitments on paper also assists producers in getting finance before the harvest and balancing their cash flow. Our approach this year is to contract as much coffee ahead of the harvest as possible to secure coffees for each of our relationships. We will need the help of our partners to pull this off!

Transitioning from ‘21 to ‘22

Perry Czopp