Why Single-Origin Coffee Is So Expensive
Narrator: To produce one pound of coffee beans, farmers need to harvest more than 1,500 of these cherries. Each one contains two seeds that will be sorted, processed, and roasted before they reach your cup.
In 2022, the average US price for a pound of coffee was $5.89. But there’s a specialty category called single-origin coffee that can easily cost over $30 per pound. Some exclusive harvests cost over $80 per pound. So, what makes this coffee so special? And why is it so expensive?
It’s November in Nyeri County, Kenya, and the coffee harvest is in full swing. There are over 12.5 million coffee farms in the world. Almost 95% are owned by smallholders, like Joseph. He runs a 1-acre farm, part of which he inherited from his parents.
Joseph Mukuha: Coffee is all about quality. If you produce coffee with a higher quality, the higher prices you’ll get for your coffee.
Narrator: Coffee grows differently depending on the altitude, climate, soil, and sun. Farms here sit around 1,700 meters above sea level in rich volcanic soil.
Joseph Mukuha: The coffee grow[s] very slow. They take a long time to mature. And the longer coffee take time to mature, the better the quality. Almost everywhere, every farmer is growing coffee.
Narrator: High-altitude coffee produces fruity and floral flavors. Drinking coffee brewed from beans exclusively from one region ensures that those distinct flavors come through. It’s what’s called single-origin coffee; the quality and unique taste are the biggest reasons it can cost so much.
But achieving that quality isn’t easy. The terrain here is too uneven for machines, so farmers pick the coffee by hand, one cherry at a time. For coffee, ripeness is key.
Mary Nyambura: I pick the red mature ones and leave the green ones. I return later, after tow or three weeks, after the green ones have matured. Per week, I can harvest up to 500 kilograms.
Narrator: Mary has been growing coffee for over 25 years.
Mary Nyambura: This coffee I inherited from my grandfather. This coffee has been around for 50-something years.
Narrator: Each branch has ripe and unripe cherries, so she has to pay close attention while picking. The way coffee is harvested here in Kenya is very different from how it’s done in Brazil, the world’s largest coffee producer. On huge farms with flat terrain, the harvest is mechanized. The trees are at a lower elevation, and the yields are higher. Mechanized production is more efficient, but this efficiency can hurt quality control. When the whole tree is picked at once, ripe and unripe cherries are lumped together.
This is commodity coffee, destined for mass production and industrial use. Its price is low and volatile.
The highest-quality coffee is called specialty coffee. This coffee has unique attributes that expert tasters, called Q graders, rate the highest. Single-origin coffee is often rated at the highest end of specialty coffee because of its distinct flavors. Both specialty coffee and a lot of commodity coffee come from the same plant, Coffea arabica. But not all arabica coffee is created equal.
This can of ground coffee is 100% arabica. It costs around $8 a pound. In 2022, a single-origin coffee grown in Panama sold for over $6,000 a pound at auction – also 100% arabica. The better the flavor and the smaller the harvest, the more expensive the coffee.
Back at Mary’s farm, there’s still work to be done. After harvesting, workers sort the cherries to weed out any defects. These negatively impact the flavor and lower the price of the coffee. But they need to work quickly. Processing coffee soon after harvest is key to maintaining its quality.
Processing infrastructure is expensive, so most farms in Kenya share centralized facilities. Over 1,000 farmers from the region bring their coffee here. Each processing method has a different impact on taste, but they all have the same end goal: separate the seed from the fruit.
Peter Muriuki Mwatha: These are the five stages of coffee processing. The red cherry, the wet parchment, dry parchment, green coffee, and roasted coffee beans.
Narrator: This is the washed process. It’s the most common way to process coffee in Kenya. After weighing and inspecting the coffee, workers remove the outer skin in a process called de-pulping. Then they place it in fermentation tanks, where it rests for 12 to 14 hours. Fermentation breaks down the mucilage, the sticky inner layer of the fruit, so it can be washed away.
The next day, workers push coffee through a series of channels, cleaning off the seeds. This is also where one of several grading processes takes place. Workers separate lower-quality, less dense beans, which float to the surface. Even though these beans sell for less, they still provide important income to producers.
The denser coffee flows to soaking tanks to ensure any remaining mucilage is removed. Once the seed is free, the coffee flows out of the tanks and onto drying tables. Roasters sell coffee either as a blend of beans from different countries or as single origin. But there’s no officially agreed-upon definition of the term. It can refer to a farm, a cooperative, or a country. Consumers who buy this type of coffee are usually seeking a particular flavor or aroma. The costs of processing, transportation, and running a roasting business are all bundled into the price customers pay for coffee.
Xavier Alexander: It’s so expensive to get coffee here. Everything from the farm to the port, everything has gone up. The boxes where we ship your coffee for subscriptions or at-home consumption, that packaging has gone up. With single origin, single producer, when you have the producer’s name, it’s an indicator that we paid more for that coffee because of the relationship. If you’re paying in the range of $21 to $26, it’s because we’ve invested in these areas that are important to us and we hope are important to them.
Narrator: Companies like Metric play an important role in the coffee supply chain. Most coffee is consumed outside of the country it’s produced in. And how coffee is roasted has a big impact on its taste.
Getting the best flavor out of single-origin coffee requires careful roasting. Coffee is roasted in big machines like this. Roasters take green coffee and heat it evenly to develop its flavor.
Hara Kumaran: This is 20 pounds of Costa Rican honey-processed coffee from Solis y Cordero, which is a husband-and-wife team in Tarrazú.
Narrator: Hara uses sight, smell, and sensors to track how the roast is developing. Finding the ideal roast level for each coffee is a skill that takes years to master.
Hara Kumaran: This tool that I’m using is called the trier, and it allows us to see the color of the development as we go through the roast and also to smell how the coffee is smelling. The green coffee will smell kind of like hay or grass. And you’ll smell it get sweeter and sweeter and sweeter. You can smell some of that acidity come out. It’ll smell almost vinegary-ish. As soon as that vinegar starts to fade just a little bit and there’s a sweet fruitiness and a sweet baked-goods-ness, that’s our finished development.
Narrator: Metric roasts coffee for an average of 11 minutes before Hara releases it into the cooling tray to stop the roasting process. By comparison, commodity-coffee roasters favor a darker roast, which can cover up defects and make a blend of beans from different countries taste more uniform. While dark roasts are generally bitter, medium and light roasts offer more sweetness and bright acidity.
Hara Kumaran: You can blast it for a minute, and a lot of commodity coffee is just blasted as quick as possible, but it really rushes through all of those phases that develop all of the flavors. Going through those steps to get exactly the best qualities out of that coffee. We don’t add anything to coffee. Everything was intrinsically there as the raw product from the farmer, from the growing conditions.
Narrator: Light roasts also highlight the unique flavors of a region, allowing two single-origin coffees to taste very different.
Xavier Alexander: The tricky part about single origin versus blend is that you can achieve stellar results with blends and sometimes really subpar with single origin. And the same thing can be the other way around.
Narrator: How a coffee is processed can have a big impact on its flavor and price. The washed process produces delicious coffee, but it’s expensive and can be wasteful.
Joseph Mukuha: We use a lot of water, and the main challenge is how to dispose that wastewater, but we are trying to work on it by recycling the water we are using.
Narrator: After spreading out the coffee, workers move it to a clean set of tables, where they continuously turn it by hand. This coffee takes around 14 days to reach a desired moisture content of 11% to 12%. The goal is uniform beans free of defects. Coffee at this stage is called parchment coffee because of the paper-like layer of material that surrounds the seed.
Before producers ship the coffee, they mill it to remove the parchment. This is a small machine used for local consumption. When milling large quantities, the coffee goes through another round of grading. Each country has its own methods of grading. In Kenya, each bean is classified by size. The shape and color of the bean also impact the grade, but often the larger, denser beans are the most expensive.
After months of work, producers are left with what’s called green coffee. This is the product that will be exported and roasted in consuming countries. But this is also when the process becomes more opaque. Farmers don’t always know how much a buyer pays an exporter, so they don’t know if they’re being cut out of potential profit.
The benchmark for the price of arabica coffee follows what’s called the C Market. It’s an exchange, like the stock market, where traders buy and sell contracts based on the expected future value of coffee. But it doesn’t consider the quality of the coffee. And the price is volatile, which makes it hard for farmers to operate sustainably. In 2019, the average closing price was $1.02 per pound. Its lowest point that year: $0.87. Despite inflation and increased cost of production, the C Market is almost the same as it was in 1980.
Joseph is able to operate profitably, but that isn’t the case for many farmers around the world. A 2019 study found that 44% of smallholder coffee farmers were living in poverty. Specialty coffee is bought at a premium above the commodity price. Joseph makes around $3.18 a pound.
Joseph Mukuha: Due to the high quality of our coffee, there is a lot of demand. But our expectation is that the demand should go with higher prices.
Narrator: He says $4.55 a pound would be more sustainable, but his prices have actually decreased over the past few years.
Joseph Mukuha: I don’t know the reason why. Mostly, we are told world market has flooded with coffee, but we still need more explanation on why the coffee is going down when we are still trying our best to maintain our quality coffee. For those who are producing less than 5 kilos from one tree, they are not even breaking even. The effort we make to produce that quality coffee, I can say we are not well compensated by those prices.
Narrator: Growing coffee requires steep investments, which don’t always pay off for farmers.
Mary Nyambura: Coffee farming is a hard endeavor if you don’t have money. But it is not hard when you have money.
Narrator: Many roasters in the industry are working towards direct-trade partnerships that benefit the coffee producer.
Xavier Alexander: I’m looking to do two things: source high-quality coffees, but also establish year-over-year relationships.
Narrator: Some roasters also publish the prices they pay for green coffee, but the level of transparency varies.
Xavier Alexander: We as roasters need to do our job to educate consumers as to the difference between a product from Colombia that’s sourced fairly, that’s sourced with full transparency, and a product of Colombia that has no traceability and is cheap. If it’s cheap coffee, that means that somebody in the supply chain is not making it, and chances are it’s going to be the producer. They’re the ones at loss.
Narrator: At retail, coffee from this region of Kenya has sold for $22.50 for a 12-ounce bag. That’s over nine times what the farmers are paid. But just comparing those two numbers doesn’t tell the whole story. Even when producers are paid a premium, there will always be a markup between coffee cherries and roasted coffee. Roasters typically pay more for single-origin coffee, but there’s no definitive premium.
Xavier Alexander: The real truth of it is that you can buy coffee at commodity pricing that actually meets specialty standards. For so long, the market has been so low and then the quality has been so high that producers need to sell their coffee. They need to earn a living. Because if they’re not earning enough to cover the cost of production, not earning enough to just meet the minimum requirements to have a decent way of life, they’re going to be edged out. That is what’s happening all over the world.
Narrator: Many throughout the specialty-coffee industry are working towards more transparency, better pay for producers, and more access to research and best practices. Ultimately, when coffee prices are low, the producers are the ones hurt the most.
