Unpacking the 2020 Specialty Coffee Transaction Guide

The 2020 Specialty Coffee Transaction Guide provides insight to the state of a sometimes mysterious segment of the market.

As commodity coffee prices continue to sit at unprofitable levels for many producers, some members of the specialty coffee industry have considered the need to separate their price references from the commercial market.

In 2018, 21 of these companies – including roasters, importers, and exporters – provided data on more than 10,000 contracts to Transparent Trade Coffee (TTC), a team of researchers at Emory University led by Dr. Peter Roberts and Chad Trewick of Reciprocafé.

These contracts covered around 68,000 tonnes of green coffee, with an overall value exceeding US$340 million, and served as the basis for the first edition of the Specialty Coffee Transaction Guide (SCTG).

The guide is a collaboration between researchers from Transparent Trade Coffee at Emory University, and a growing roster of specialty coffee producers, exporters, importers, roasters, and supporters. It is designed to provide specialty coffee roasters and importers with a more relevant information source than commodity indices to use as part of their independent pricing strategies. Released annually, the SCTG has grown every year, with the 2020 edition collating information on green coffee prices and buying from 81 data donors covering 494,415 tonnes valued at US$2.1 billion.

Five Senses Coffee in Australia is one of the donors. Its Director of Coffee, Matt Slater, former International Director of the Re:Co Symposium for World Coffee Events and the Specialty Coffee Association, says the SCTG fosters a greater level of openness and trust in the coffee industry.

“Green coffee prices have historically been determined by commodity price references. In most cases, these prices do not cover the full cost of production and go nowhere near what is needed to support the livelihoods of coffee farmers and their families,” Slater says.

“The Transaction Guide is a move away from using the current commodity price as a starting point for price discovery and allows an informed discussion around the true ‘value’ of a coffee, taking into account variables such as quality and lot size.”

The 2020 SCTG lists US$2.60 per pound as the median middle free-on-board price paid for specialty coffee in coffee year 2019/2020. This is down 15 US cents from the 2018/2019 coffee year, which the guide suggests was caused by a move from higher-quality, more expensive coffees towards higher-volume and lower-scoring specialty coffees.

Within the 25th percentile (lowest quarter of prices) the median was US$1.90 per pound, in-line with the year prior. In the 75th percentile (highest quarter of prices) the median was $3.50 per pound, six US cents down on 2018/2019.

According to the 2020 SCTG, in each harvest year, the range of prices paid for green specialty coffees is quite large. In 2019/2020, 50 per cent of the prices in the sample covered a range of US$1.60 – from US$1.90 to US$3.50. When it comes to quality, in 2019/2020, the median price for coffees with scores from 86-87.9 range was US$3.50 per pound, 84 per cent higher than the median price for 82-83.9 coffees, at US$1.90 per pound. For lower-quality coffees, the lower prices declined in 2018/2019, but then rebounded in 2019/2020.

Another factor influencing prices was lot size, with smaller lots and quantities earning higher prices per pound. In 2019/2020, the median price per pound for lots of less than 1000 pounds, US$4, was more than double that paid for lots of more than 40,000 pounds, US$1.90.

The guide estimates that roughly 6 per cent of specialty coffee produced over the last three harvest years is included in the 2020 SCTG. Trewick reflects on the growing utility of the Guide, saying that as participation and awareness of the Guide grows, we increasingly know the value specialty coffees hold in the market.

“These prices must be accessible by producers as well as buyers of green coffee,” he says. “This is critical as the industry seeks to understand the economic potential specialty coffee represents in the context of supporting producer livelihoods and maintaining access to a diversified supply of green coffee upholding both ethical and quality standards.”

Some of the many data donors of the 2020 SCTG include Café Imports, Campos Coffee, Caravela, Cedro Alto, Counter Culture Coffee, Cup of Excellence, Hasbean Coffee, Intelligentsia, Olam Specialty Coffee, Onyx Coffee Roasters, Ozone Coffee, Stumptown Roasters, Sucafina Specialty, Sustainable Harvest, Tim Wendelboe, Union Hand-Roasted, and Verve Coffee Roasters.

For more information,

© 2020 All Rights Reserved. All content published on this site is the property of Prime Creative Media. Unauthorised reproduction is prohibited