Jaspers Caffeine Dealers owner Wells Trenfield samples a brew as Tong Zhou prepares to roast a fresh batch of beans. [Courtesy of The Sydney Morning Herald]
''We are keeping people impoverished because we are not prepared to pay 21st-century prices for the stuff we enjoy. It's still cheaper than a beer.'' - Wells Trenfield, Owner of Jaspers Caffeine Dealers
By Maris Beck
The Sydney Morning Herald
September 5, 2010
The caffeine dealer's warehouse in Collingwood is piled high with sacks of coffee beans. They haven't even been roasted yet but already they are giving suppliers the jitters.
With unprecedented demand from Asia squeezing global coffee supplies and weather problems affecting crops, wholesale prices have been soaring for months.
If the all-important Brazilian harvest falls short, the average cost of a cappuccino in Melbourne could hit $4 within a year - an increase of 76 cents.
A soon-to-be-released survey of 600 east coast cafes, the ''Cappuccino Price Index'', shows that the average Melbourne cappuccino costs $3.24 - more than a Sydney caffeine fix, and about 20 cents more than it did last year.
This upward trend is set to continue with the price of arabica beans recently hitting a 12-year high on the New York Futures Exchange.
Steve Agi, editor of coffee magazine Bean Scene, said consumers had been largely protected from the market volatility because roasters had been absorbing most of the extra costs.
Many roasters have contracts to supply beans at set prices.
But Jaspers Caffeine Dealers owner Wells Trenfield, who roasts his own beans, says with the price of green beans jumping by up to 18 per cent in the past six months, roasters would have to start passing on costs.
''It's always a very risky business trying to buy and sell this stuff,'' Mr Trenfield said.
He said the supply shortfall and increased demand had meant that farmers in Ethiopia, who had struggled through very hot weather, were able to charge high prices for their inferior beans.
Everyone was now watching the Brazilian harvest, as it would affect global supply.
''If there is a shortfall, and it looks now like there could be … there will be massive problems globally by next year,'' he said. ''We will be looking at major increases in price because there will simply not be the coffee available.''
A senior food and agriculture analyst at Rabobank, Wayne Gordon, said while wholesale prices had jumped, this year's harvest was looking better than last year's. However, recent price rises in sugar and milk would also push up the cost of a cup of coffee.
''No matter how you look at the cup of coffee, you are getting hit from all sides,'' he said.
Even with the rises, we will still be drinking ''dirt-cheap coffee'', Mr Trenfield said. ''We are keeping people impoverished because we are not prepared to pay 21st-century prices for the stuff we enjoy. It's still cheaper than a beer.''
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