Coffee prices rising in the Hilir, Farmer Still Struggle:?

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There's one pretty ironic thing in the coffee industry right now. Downstream, we see a lot of coffee prices go up, even a premium. But upriver, a lot of the growers are still struggling. The cost continues to rise fertilizer, labor, operational but the prices they receive are not always stable or fair.

So where did it go wrong? Is the supply chain system too long? Or was the biggest value taken on the side of branding and retail? If these conditions keep going, will there be fewer farmers? It's curious to hear your perspective, especially those who've jumped into the field.

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this is how I feel. The coffee price in the café goes up 20-30%, but the price of cherry in my garden goes up only 5-8%. All the rises are absorbed in the middle of the processor, exporter, importer, ZZCF001Z. We are at the end of the upriver not to part.

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the coffee value chain is indeed long and each layer takes a margin. from farmer to consumer end there could be six to eight hands. the main problem is the bargaining position of the weakest farmers because fresh commodities don't last long and they need fast cash in the harvest.

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but it doesn't look like anything serious, does it? it's been a matter of years. isn't there a concrete move we can do besides grumbling?

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i mean, there's a system, Kyle, but usually it starts with a commitment buyer. If roaster or café wants to direct trade and pay fair price with transparency, that's one concrete move. Can't just wait for regulation from the top.

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if we break down a glass of espresso Rp45,000: Zgreen bean is only 10-12%, Zroasting + packaging 8%, overhead café 45-50%, margin 25- 30%. That means that if green goes up 50%, the impact on the menu is only about 5-6%. But to a farmer, the 50% increase is also not easy because their production costs go up.

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i don't think i'm productive enough. the coffee supply chain is structural. the direct trade could be a solution but it requires scale. strong operatives can be leverage, but a lot of management is weak. there's not one solution that can go straight scale.

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there are some models that are already being tried: direct trade, impact sourcing, transparency pricing with open audit. Not yet able to scale into all farmers, but in the Indonesian specialty coffee community there's a serious run on this and the result is quite encourage.

Coffee prices rising in the Hilir, Farmer Still Struggle:?

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