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Coffee Brewing

Brewing coffee is as much of an art as it is a science. The history of coffee brewing equipment is rich, and methods of brewing are culturally dependent. Of the thousands of coffee machines and coffee brewing devices invented since the advent of coffee consumption, only a few have gained worldwide popularity. The coffee brewing methods discussed below are recommended since they have been found to maximize the extraction of the beneficial flavors of coffee, while minimizing the extraction of bitter coffee compounds a nd undesirable components.

Procedure of Making Coffee: Directions

The following general rules apply to each coffee making process discussed. Coffee should be brewed for 4.5-5 minutes using a ratio of 55 grams of ground coffee per liter of filtered water (195-205°F). It is convenient to use 2 tablespoons of coffee per 6 ounces of filtered water. Filtered water and spring water are recommended. Tap water imparts off flavors to the coffee and some minerals are essential to coffee flavor. Distilled water is not recommended for brewing coffee as it lacks the minerals to bring out the natural flavors of the coffee.

Coffee Maker Reviews

french pressFrench Press: The best way to control the time and temperature is to use a French press coffee maker. The French press offers unparalleled flavor due to perfect extraction time and delivery of the volatile oils that are often trapped in paper filters. A French press is also the least expensive coffee brewer available. To make coffee in a French press: boil the correct amount of water, freshly grind the coffee beans using a course setting, remove the plunger, place the coffee grounds at the bottom of the glass, add the hot water, stir by shaking, and after 4-5 minutes press the plunger down to separate the grounds from the extracted coffee. The best French presses are made by Bodum and come in sizes of 3 and 12 cups. An insulated version is also available. Note: You do not want to pour boiling water directly onto the coffee. The goal is to brew coffee at a temperature between 195-205°F.

Unfortunately, French press coffee makers are not quite as convenient as a drip coffee makers due to preparation time and cleaning time. The French press also loses heat faster than some other methods, but extraction at slightly varying temperatures will promote a more dynamic and complex cup of coffee. To minimize heat loss effects, Bodum has developed an insulated coffee press. This press is highly recommended for both design and attention to coffee brewing details.

electric french pressA novel integrated electric water heater-French press is available from Chef's Choice. This French press minimizes the complexity of using multiple devices to boil and then brew the coffee. We use it daily at the Coffee Research Institute and highly recommend it for those who want to simplify the brewing process without sacrificing quality.

Vacuum Coffee Pot: The vacuum coffee pot is a clever device invented by Robert Napier in 1840 that prepares an exceptional cup of coffee with a potent aroma. This is an appropriate alternative for those who have an aversion to the taste of the paper filters from drip brewers or for people who dislike the sediment in the bottom of the cup from the French press method.

To brew coffee in a vacuum pot, add the proper amount of filtered water to the bottom bulb, attach the filter to the upper bulb and fit the upper glass bulb tightly over the bottom glass bulb. Place the vacuum coffee pot on the stove, making sure that the bottom bulb is completely dry on the outside. Use a medium grind and add the grounds when the water begins to fill the upper chamber. Leave the pot on the stove for 3.5 minutes and then place on a hot pad. Within 30 seconds the lower pot will cool enough to form a vacuum to pull the brewing coffee into the lower chamber, thereby separating it from the grounds. Experiment with the heating and cooling cycles until the total extraction time is between 4-5 minutes. A great and inexpensive vacuum coffee pot available is the Bodum pot (pictured to the left). An electric vacuum pot (pictured to the right) is also available from Bodum.

Automatic Drip Coffee Maker: The easiest way to brew coffee is by using an automatic drip coffee brewer. Unfortunately, few coffee machines brew at the right temperature for the correct amount of time. The best drip coffee makers currently available are produced by Techni Vorm and distributed by Boyd's coffee and Sweet Maria's Coffee. Of the available models, the MoccaMaster Clubline KB 741 with the insulated carafe is probably the best drip brewer available on the market.

To brew coffee in a drip brewer, place a thick paper filter in the brewing cone (basket) and thoroughly wet with water. This helps remove the paper taste from the filter. Then freshly grind the coffee using a medium grinder setting. As the water begins to boil, pour the coffee into the coffee filter. Now as the water pours over the coffee, shake the basket (removable in the Technivorm) to ensure an even extraction. Brew time and temperature are taken care of automatically. If your brewer has a hot plate under a glass carafe, remove the carafe after the coffee is fully brewed to prevent the coffee from burning.

Espresso: Making espresso is a bit more difficult than the above brewing methods and an espresso section of this website has been dedicated to it.

No other coffee brewing method is recommended due to problems with either over extraction, under extraction, or timing.

Coffee Roasting

commercial coffee roasting machineCoffee roasting is a chemical process by which aromatics, acids, and other flavor components are either created, balanced, or altered in a way that should augment the flavor, acidity, aftertaste and body of the coffee as desired by the roaster.
Roasting Coffee Beans

The first stage is endothermic. The green beans are slowly dried to become a yellow color and the beans begin to smell like toast or popcorn.

The second step, often called the first crack, occurs at approximately 205 °C (400 °F) in which the bean doubles in size, becomes a light brown color, and experiences a weight loss of approximately 5%. The corresponding Agtron number for this color is between 95-90 (Davids, 68-69).

In the next step the temperature rises from 205 °C to approximately 220 °C, the color changes from light brown to medium brown (Agtron # 60-50), and a weight loss of approximately 13% occurs (Davids, 68-69). The resulting chemical process is called pyrolysis and is characterized by a change in the chemical composition of the bean as well as a release of CO2.

The second step is followed by a short endothermic period which is followed by another exothermic step called the second crack. This second pyrolysis occurs between 225-230°C, and the roast color is defined as medium-dark brown (Agtron #50-45) (Davids, 68-69). The second pop is much quicker sounding and the beans take on an oily sheen.

coffee roasterEspresso potential is maximized in roasting when you maximize the sweetness and aroma of the coffee while minimizing the bitterness and acidity. Most people focus on the latter and therefore roast extremely dark, yet without sweetness and aroma the espresso will never be palatable. This explains the unpopularity of straight espresso and the popularity of espresso based drinks where either milk or other flavors are used to replace the sweetness that was lost by roasting darkly.

From 170-200°C the sugars in coffee begin to caramelize. From tasting pure sugar versus its caramelized component it is evident that uncaramelized sugar is much sweeter. The dark color of coffee is directly related to the caramelization of the sucrose in coffee. Therefore, to maximize sweetness you want to minimize the carmelization of sucrose, yet you do not want to roast too lightly or bitter tasting compounds will not thermally degrade. Stop the roast somewhere between the end of the first crack and less than half way through the second crack. Do not roast well into or past the second crack. We recommend a roasting chamber temperature somewhere between 205-215°C. Realizing the danger of the following suggestion we might recommend a color similar to the one below. Note: All monitors, computers, and internet browsers will display the color slightly different. This is only a recommendation to point out that this color is preferable to the almost black color you will frequently observe for espresso. To get a better idea of roasting colors order the Agtron roasting classification kit from the SCAA.

One way to ensure the same roast degree is achieved each time it is necessary to purchase a set of Agtron tiles from the SCAA or purchase an Agtron roast analyzer.

Espresso

The best espresso should be extraordinarily sweet, have a potent aroma, and flavor similar to freshly ground coffee. The crema should be dark reddish-brown and smooth, yet thick. A perfect espresso should be enjoyable straight with no additives, yet bold enough to not disappear in milk. A pleasant and aromatic aftertaste should linger on the palate for several minutes after consumption.

The following steps describe in detail how to make espresso. You will also learn about the various factors and problems with espresso that limit its perfection. If any of these factors are off, you will not achieve a high quality espresso.
Making Perfect Espresso
Blending Espresso

Without a good espresso coffee blend you cannot have a good espresso. The best espresso coffee beans are blended to achieve the sweetness, aromatics, and smoothness desired in espresso. The espresso blend must also be fresh. We recommend using espresso within four days of roasting. Please see the espresso blending section for help on creating your own blends or order some excellent espresso blends from roasted coffee suppliers, such as Caffe D'arte or Espresso Vivace.

Roasting Espresso

Too often you will find espresso roasted very dark. This results in a bitter, charcoal tasting brew. People that know how to make an espresso will roast light to preserve the aroma and sugars. For more information, read the section about espresso roasting.

Grinding Espresso

The grind must be continuously monitored throughout the day to achieve an extraction time of 25-30 seconds. Do not change the pressure you tamp with to compensate for a grind that has become too large or small. For more information, read the section about espresso grinding.
Espresso Grinder

A high quality burr grinder is essential for espresso. A conical burr grinder is preferred to flat burrs since the particle size is more even, they last longer, and the coffee is not heated during the grinding process. If the burrs become hot the coffee aroma will be diminished. A conical/parallel hybrid blade is considered the best design by many coffee professionals.
Dosing Espresso

Coffee must be freshly ground to achieve peak flavors. Grind and dose on demand. When someone orders an espresso grind only what is necessary for one shot, dose properly, tamp, and brew. Discard any espresso grounds that are not used within 30 seconds. For more information, read the section about espresso grinding and dosing.
Distribution in Portafilter

Tamping Espresso
Tamp the coffee once very evenly with 5 lbs of pressure, then once with 30 lbs of pressure, and polish 720° with 20 lbs of pressure. For more information, read the section about espresso tamping.

Water mineral content
The water used for espresso must be filtered. Some cities must even compensate for the mineral content of their water. Over time oxygen will be forced out of the water in the espresso machine leading to off tasting water. Try filling a small glass with water, letting it cool, and tasting it for off flavors. If the water tastes strange you may want to dump the tanks daily and begin with fresh water.
Water temperature

The water temperature should be stable and somewhere between 92-96°C. Choosing the best espresso machine is very important to both water temperature and temperature stability.
Temperature stabilizing

A stable temperature helps ensure that you prepare excellent espresso. For more information about stabilizing the temperature of your espresso machine, read about espresso temperature stabilizing.

Water pressure for Espresso
The pressure of the water forced through the espresso should be between 9 and 10 atm. This pressure is responsible for the development of the crema.

Boiler pressure
The boiler pressure determines the amount of water to be incorporated in the steam. If your milk is not foaming correctly as described in the section on latte art, you may want to experiment with different boiler pressures. Boiler pressure, however, should only be altered by professionals. You can check your boiler pressure by looking at the boiler pressure gauge on the front of most espresso machines.

Extraction time
Extraction time to fill two 1-oz cups should be between 25-30 seconds. Despite the time the pump should be turned off if the espresso becomes slightly lighter in color. The goal is to have a dark red espresso take approximately 25-30 seconds to brew with no change in color. Fore more information, read the section on extracting espresso.

Porta-filter and basket
The porta-filter should always remain the same temperature as the water used to brew the espresso. Therefore it should always remain in the group head. The basket should hold 16-18 grams of coffee and must be straight walled. Curvatures in the basket will lead to uneven extraction.

Timeliness
Act quickly, but carefully. You should spend no longer than 30 seconds for the time it takes to dose, distribute, tamp, pre-heat, and brew the espresso.

Espresso machine cleanliness
Coffee machine cleaning is probably the biggest problem with espresso today. If the machine, basket, and porta-filter are not cleaned regularly, the espresso will always taste rancid.
Espresso grinder maintenance

Everyday the burr blades should be swept clean. Between shots you may want to brush out the excess espresso that gets stuck between the burrs and the dosing chamber. The burrs must be replaced at least yearly so that they continue to produce coffee granules with a maximal surface area.

Environmental Factors
The humidity and temperature will change throughout the day. Since coffee is hydroscopic (absorbs moisture), the grind size must be changed throughout the day to achieve a brew time of 25-30 seconds. The temperature will not affect the espresso like the humidity, but it is important to avoid exposing the coffee to any high temperatures until brewing.
Espresso cup

The espresso cup should be pre-heated from a source other than the espresso machine. Filling a cup with water from the espresso machine prior to brewing the espresso will lower the temperature of the water in the boiler and the espresso extraction will be uneven. The espresso cup should have thick walls and a narrow mouth to retain heat and aroma, respectively.
Practice makes perfect

If you want to learn to make espresso, it is essential to practice and experiment. The key to making espresso is to realize that it always has further potential. By changing any one of these factors you can improve or diminish its potential. Espresso preparation is an art that demands the precision and dedication of science. I have never achieved, nor have ever seen anyone make a perfect espresso. A perfect espresso is more of a concept than an actuality. The beauty is that espresso is volatile and difficult. If it were easy, we would develop a machine that knows how to make a perfect espresso every time. There are so many factors involved in espresso preparation that only a human mind and a passionate heart can begin to understand and control its complexity.

Espresso Tamping
Espresso Tamping is an art that is often neglected in espresso preparation. The goal is to create a pellet of coffee through which the hot water from the espresso machine will penetrate evenly. Since the water from the espresso machine is under pressure, the espresso pellet must be hard and evenly tamped. The water only knows how to go from a region of high pressure to a region of low pressure. Therefore it is important to prevent paths of least resistance in the coffee pellet and force the water to evenly permeate and extract the coffee.

This chapter assumes that one has read and understood how to dose the coffee properly. After the ground coffee has been dosed into the porta-filter it is unevenly distributed. Hold the porta-filter in one hand while using the other hand to quickly, but gently level the coffee. This is usually accomplished by pulling the coffee to one side of the basket with a slightly curled pinky, then pushing the coffee back to the opposite side of the basket (Picture 2). The key is to evenly distribute the coffee without pressing into the grounds or leaving any empty space on the sides of the basket.

Correct Espresso Tamping
Once you are done distributing the grounds, it is time for the first tamp. Without moving the porta-filter, hold the espresso tamper so that the base of the handle fits into the palm of your hand. Your wrist should be straight, and the espresso tamper should be a straight extension of your arm. Press gently on the coffee with five pounds of pressure. You will notice that some of the grounds will stick to the side of the basket. Therefore, one must gently tap the basket with the handle on the porta-filter to knock the grounds onto the flat pellet you just formed
The next step is to apply the finishing espresso tamp. The shape of the pellet has already been formed, and the finishing tamp confirms this impression. With the tamping tool held as before, press on the pellet with thirty pounds of pressure. It is useful to tamp espresso on a bathroom scale until you become comfortable with the amount of force necessary to achieve the appropriate pressure. After tamping, turn the espresso tamper 720° while continuing to apply pressure to polish the surface. Make sure you tamp evenly. An uneven espresso tamp will result in an uneven extraction.

The above steps should be carried out in about thirty seconds. Although speed is important, it is necessary to be careful not to bump the basket during this process. Sharply hitting the basket will unevenly distribute the grounds allowing shortcuts for the water to pass through. As any scientist can appreciate, the path of least resistance is preferred. If there are any weak spots or holes in the espresso pellet the water will push through this area, over extracting this portion of coffee while under extracting the rest of the pellet. Improper espresso tamping will result in a twirling pour or white crema.

Check the spacing above the espresso pellet and below the dispersion screen. You can do this by dosing, distributing, and tamping as described above. Then insert the porta-filter and remove it. Does the screen or screw press down onto the coffee? If so, the coffee will not have enough room to expand as it is brewing. On the other hand you want to have between 16-18 grams of coffee in the basket. Experiment with these two factors until you achieve a good height for the espresso pellet.

Choosing the Correct Espresso Tamper

Just as correct espresso tamping is essential, so is the use of a proper espresso tamper. The first action you should take is to throw away the plastic round bottom tamper that you currently have. The espresso tamper should be made of aluminum or similar light metal and should have a diameter so it fits firmly into the basket. Marzocco baskets are 58mm, so order the appropriate size. Without a flat packing surface, you create indents which cause uneven extraction. You may order your espresso tamper from Vivace's which sells several different size pistons to perfectly fit your basket. Currently, Vivace's has recommended the use of a round bottom coffee tamper rather than the traditional flat bottom tamping machines. This suggestion is welcome to further discussion. Currently, my observations do not support the conclusion that the rounded bottom tamper is better. Initial crema is thicker, but overall crema is less. I will continue tests with other espresso machines and with other espresso blends. You should also order the book "Espresso Coffee: Professional Techniques," a great book on espresso preparation.

Latte Art

When steaming milk for espresso, milk frothing techniques are performed to create a smooth and sweet milk that can be poured into heart and flower patterns. Although the ability to pour art in a latte or cappuccino does not indicate quality in itself, it is indicative of the passion of the barista. The ability to pour patterns into drinks will let your customers and friends know that you are serious about espresso.

Materials: Whole milk, straight walled steam pitcher (or milk frothing pitcher), an espresso machine with a powerful steam wand, thermometer, and a 14 oz latte cup. Prepare the steamed milk first, then the espresso.
Latte Art Instructions:

1) Begin with very cold milk. It is important to keep the milk temperature right above freezing. Keep the steam pitchers in the refrigerator also. This will allow you to steam the milk for a longer period of time to achieve the smooth and velvety texture that is required for latte art.

2) Fill the milk pitcher with the right amount of milk for one cup. You will probably have some milk left over after steaming. Start with fresh milk for every cup.

3) Place the steam wand at the bottom of the pitcher. Turn the steam on, and slowly raise the wand so that it is near the top of the milk. As the milk rises, lower the pitcher so that the steam wand remains approximately 1 cm from the top of the milk. Stretching should be minimal, no big bubbles should be formed. The key is to get smooth velvety milk, not the thick foam that floats above the espresso. When poured, the milk should flow into and mix with the espresso.

4) Milk temperature is critical. When the milk has reached 80 ºF, push the steam wand deep into the milk on the side of the pitcher, and position the pitcher to spin the milk counterclockwise. Continue the spinning motion until the milk reaches 150-160 ºF. Steaming milk over this temperature limits the sweetness of the milk. After stopping the steam, carefully remove from milk and clean with wet cloth. Remove thermometer from milk.

5) Swirl milk vigorously. If any bubbles are visible pound the pitcher on the counter several times. Swirl after pounding. I recommend swirling for 20-30 seconds. This can be done effectively while the espresso is pouring.

6) Begin pouring milk into the espresso. For a flower pattern, pour into the bottom portion of the cup, approximately an inch from the bottom of the cup. Pour gently into one spot and do not shake the pitcher. As the cup is about half filled, begin to shake the pitcher back and forth while slowly moving backward. The flower pattern will move forward and fill the cup. I have found that a shaking motion via movement of the wrist is better than physically moving the hand back and forth.

7) When the milk reaches the top of the cup, sweep through the pattern you created by quickly pouring milk up the center of the pattern. Pouring less milk here is better because it will not sink the flower pattern.

Note: To pour a heart pattern, shake as you were doing above, but do not move backwards as much. Concentrate on forming a ringed circle and then slowly sweep through the steamed milk and espresso to form a multi-layered heart.

Arabica and Robusta Coffee Plant

Coffee Plant Overview
The coffee plant is a woody perennial evergreen dicotyledon that belongs to the Rubiaceae family. Because it grows to a relatively large height, it is more accurately described as a coffee tree. It has a main vertical trunk (orthotropic) and primary, secondary, and tertiary horizontal branches (plagiotropic).

The Difference Between Arabica and Robusta Coffee Beans
While there are several different coffee species, two main species of coffee are cultivated today. Coffea arabica, known as Arabica coffee, accounts for 75-80 percent of the world's production. Coffea canephora, known as Robusta coffee, accounts for about 20 percent and differs from the Arabica coffees in terms of taste. While Robusta coffee beans are more robust than the Arabica plants, but produces an inferior tasting beverage with a higher caffeine content. Both the Robusta and Arabica coffee plant can grow to heights of 10 meters if not pruned, but producing countries will maintain the coffee plant at a height reasonable for easy harvesting.

Coffee Plant Growth and Development
Three to four years after the coffee is planted, sweetly smelling flowers grow in clusters in the axils of the coffee leaves. Fruit is produced only in the new tissue. The Coffea Arabica coffee plant is self-pollinating, whereas the Robusta coffee plant depends on cross pollination. About 6-8 weeks after each coffee flower is fertilized, cell division occurs and the coffee fruit remains as a pin head for a period that is dependent upon the climate. The ovaries will then develop into drupes in a rapid growth period that takes about 15 weeks after flowering. During this time the integument takes on the shape of the final coffee bean. After the rapid growth period the integument and parchment are fully grown and will not increase in size. The endosperm remains small until about 12 weeks after flowering. At this time it will suppress, consume, and replace the integument. The remnants of the integument are what make up the silverskin. The endosperm will have completely filled the cavity made by the integument nineteen weeks after flowing. The endosperm is now white and moist, but will gain dry matter during the next several months. During this time the endosperm attracts more than seventy percent of the total photsynthesates produced by the tree. The mesocarps will expand to form the sweet pulp that surrounds the coffee bean. The coffee cherry will change color from green to red about thirty to thirty-five weeks after flowing. See Flash movie on Coffee Bean Development.

Coffee Plant Root System
The roots of the coffee tree can extend 20-25 km in total length (Malavolta, 195) and the absorbing surface of a tree ranges from 400 to 500 m2 (Nutman). There are main vertical roots, tap roots, and lateral roots which grow parallel to the ground. The tap roots extend no further than 30-45 cm below the soil surface. Four to eight axial roots may be encountered which often originate horizontally but point downward. The lateral roots can extend 2 m from the trunk. About 80-90% of the feeder root is in the first 20 cm of soil and is 60-90 cm away from the trunk of the coffee tree (Mavolta, 195-196). However, Nutman states that the greatest root concentration is in the 30 to 60 cm depth. The roots systems are heavily affected by the type of soil and the mineral content of the soil. To be thick and strong, the coffee roots need an extensive supply of nitrogen, calcium and magnesium. During planting the main vertical roots are often clipped to promote growth of the the horizontal roots, which then have better access to water and added nutrients in the top soil.

Coffee Leaves
The elliptical leaves of the coffee tree are shiny, dark green, and waxy. The coffee bean leaf area index is between 7 and 8 for a high-yielding coffee (Malavolta, 195). The coffee plant has become a major source of oxygen in much of the world. Each hectare of coffee produces 86 lbs of oxygen per day, which is about half the production of the same area in a rain forest (source: Anacafe).

Harvesting Coffee Beans
Coffee Harvesting Times

Each year coffee is harvested during the dry season when the coffee cherries are bright red, glossy, and firm.

How to Harvest Coffee Beans
Ripe cherries are either harvested by hand, stripped from the tree with both unripe and overripe beans, or all the coffee beans are collected using a harvesting machine. These processes are called selective picking, stripping, and mechanical harvesting, respectively. To maximize the amount of ripe coffee harvested, it is necessary to selectively pick the ripe coffee beans from the tree by hand and leave behind unripe, green beans to be harvested at a later time.

For more information about coffee harvesting equipment or the methods of coffee bean harvesting, read "Coffee Harvest" by Michael Clark.

Brazil's Process of Coffee Bean Harvesting
In Brazil, harvesting the same coffee tree several times is less cost effective than separating and discarding the unripe or overripe cherries. Therefore, Brazil typically harvests using the stripping method when 75% of the coffee crop is perfectly ripe. Stripping is feasible and cost effective in Brazil due to the uniform maturation of Brazilian coffees. In stripping, the coffee beans are pulled from the tree and fall to the ground where they are caught by sheets. The beans are removed from tree debris by tossing the coffee in the air allowing the wind to carry away sticks and leaves. The coffee is then put in 60 L green baskets, which is the tool are measurement used by coffee producers to determine wages. Some coffee estates, such as Fazenda Monte Alegre in Sul de Minas Brazil, have a computerized system to determine wages for picking coffee beans. This system accounts for the amount of coffee collected from each person, the difficulty of the coffee harvesting conditions, and the production of the region being harvested.

Coffee Weight
About 12-20 kg of export ready coffee will be produced from every 100 kg of coffee cherries harvested.

Coffee Science: News, Research, and Information on Coffee Chemistry
Coffee science is a multidisciplinary field. It begins with agronomy, biology, and genetics at the field level. Then it encompasses chemistry, physics, and food science throughout the stages of processing, shipping, roasting, and packaging. Coffee scientists may focus on one particular field, but a holistic understanding of coffee and coffee chemistry is essential. The site serves as a coffee science source for coffee professionals interested in attaining a broader understanding of coffee by explaining aspects ranging from agronomy to the science of brewing coffee.
Coffee Science

This section, entitled "Coffee Science," details the coffee chemistry research performed at the Coffee Research Institute. The information is broken down into several sections to facilitate an understanding of the physical and chemical properties of coffee. It deconstructs the chemical formula of coffee to highlight which chemical components are responsible for particular effects including the aroma, acidity, and bitterness of coffee.

The other main categories of this site explain the more practical and applied aspects of coffee agriculture, espresso, coffee, social issues, and the coffee market. These sections have a scientific undertone and should be a useful extension of this coffee science section, which is dedicated to providing detailed information on the chemistry of coffee and the science of coffee beans.

Organic Coffee Beans
Benefits of Organic Coffee

Organic coffee beans are coffee beans that have been produced without the use of pesticides or herbicides. This is both beneficial to both the producer and the consumer. However, non-organic coffee is typically higher yielding because it is not usually shade grown. The definition of certified organic coffee can be extended to include an emphasis on recycling, composting, soil health, and protection of the environment. These are important aspects to sustainability that are both cost effective and socially responsible. That is why organic fair trade coffee and organic shade grown coffee often go hand in hand.
Certified Organic Coffee Beans

The most common third party certification group is the Organic Crop Improvement Association. They charge $350 for organic coffee certification. Although this is relatively inexpensive for most farms, some small producers make only $1,000 per year.

To find an organic coffee supplier or for a list of certified organic coffee retailers, visit the Organic Trade Association.

Coffee Trade: New York Coffee Exchange

There are two markets for coffee: the cash market and the futures market. The cash market is the market today. It is the price you would pay for coffee today if you could receive it today. The futures market is used to help determine the price for future deliveries. It is used to purchase a contract today to guarantee a future shipment of coffee. More importantly, however, the futures market for commodities like coffee is used to help protect against the wild variations that occur due to coffee market speculation. The latter reason will be explained in further detail through the help of an example.
Futures Market: Coffee Exchange Analysis

Assume it is currently May and assume the “C” market price for July shipment is at 95 cents/lb. Now pretend that today a coffee producer sells two units of coffee (1 unit = 37,500 lbs) to a coffee roaster or importer for 5 cents/lb over the “C.” The coffee traded is Class 3 (Exchange Grade) Guatemalan coffee to be shipped to New York. The 5 cents/lb premium is paid to cover the price of storage and insurance to carry the coffee for two months (May-July) until the delivery month (July). The two parties agree on 100 cents per pound for two units of Guatemalan Class 3 coffee to be delivered in July.

Now imagine it is early July and consider two hypothetical scenarios:

1) The happy buyer / frustrated coffee producer scenario: A frost occurs July 2nd in Brazil and coffee prices skyrocket to 150 cents/lb. Due to the aforementioned contract the producer must still sell his coffee at the previously agreed upon 100 cents/lb and therefore loses $37,500 (37,500 lbs x 2 units x 0.50 cent loss) compared to what the seller could have received had he or she sold the coffee today.

2) The broke buyer / pleased coffee producer scenario: A frost that was expected to occur in Brazil did not and there is a huge excess of coffee on the market. Prices in July drop to 60 cents/lb. Due to the aforementioned contract the buyer must still pay 100 cents/lb of coffee and therefore loses $30,000 compared to what he or she would have paid for the same exact coffee today.

In either case someone wins big and someone loses big. The risk is too severe for anybody whose livelihood is based upon this system. Therefore the coffee market was established to provide a system by which people could hedge against loses in the cash market.

Let’s go back to our previous example and ignore the hypothetical scenarios for now. The coffee producer produced two units (+2) of coffee and sold two units of coffee (-2). His or her net coffee volume is zero, but price gain is $75,000. The coffee buyer produced nothing, but bought two units of coffee. The buyer’s net gain of coffee is +2 units, but he or she loses $75,000. This is a somewhat mathematical look at any common purchase: an exchange of money for a product. But rather than taking the risk of facing either of the two previous hypothetical scenarios, both the buyer and seller take an extra precaution.

Since the producer sold two units of coffee at 100 cents/lb, he or she would also place an order for two units of coffee at the same time for 100 cents/lb. Therefore the producer maintains his or her 2-unit surplus of coffee, but has made no money.

Since the coffee buyer bought two units of coffee at 100 cents/lb, he or she would also sell two units of coffee at the same exact time for 100 cents/lb. Therefore the coffee buyer or roaster has a zero net gain of coffee and a zero loss of cash.

No one has gained or lost anything at this point. The coffee producer sold his coffee and bought somebody else’s coffee for the same price. The coffee buyer (roaster or importer) sold some coffee only to buy back an equivalent coffee at the same price. However, the coffee producer prefers money rather than coffee in payment for his or her coffee, and the coffee buyer does not really have any coffee to sell since he or she is not a producer. Then why did this somewhat backwards-sounding transaction occur?

Imagine again a scenario 1 change in the market. A frost occurs on July 2nd and coffee prices skyrocket to 150 cents/lb. However, this time the producer is both pleased and disappointed (i.e. unaffected) by the change in the market. The producer again loses $37,500 compared to what could have been made had he or she sold the coffee today (early July), but since the producer also acted as a buyer and bought two units of coffee at 100 cents/lb he or she made $37,500. The total loss is zero. Now consider the coffee importer. Again the importer is happy since they profited $37,500 from their purchase, but since they also sold coffee at 100 cents/lb versus the 150 cents/lb they could get today they also lost $37,500. The same result will occur for scenario 2. Neither the coffee producer nor the coffee importer was affected by the variation in the market.

When the coffee producer feels the time is right, he or she can then sell the extra two units of coffee to finally turn a cash profit, and during the course of one of these transactions the coffee importer must not sell coffee so that they may finally have the surplus of coffee that they need to distribute it to the coffee roasters. These transactions will typically occur on the cash market and not the futures market. Only 1% of the future contracts that are actually made take place.

This is the general idea of how a market works. Let’s look into the previous explanations a little more closely.

1) The price set in May of 95 cents/lb of coffee for a July shipment was not determined arbitrarily. The price is determined in the following manner: hedgers and investors gather in the trading area (“the pit”) of the New York Coffee Exchange (NYCE) where an open outcry auction system occurs. Hedgers can place bids to buy or offers to sell coffee until the buyer and seller mutually agree on a price (called “price discovery”). This is how the price at that moment is fixed and explains the fluctuations seen throughout the day.

2) Trading takes place from 9:15 AM to 1:32 PM (EST) M-F.

3) Deliver months are March, May, July, and September. This is why the nearest neighboring delivery month is used to set the current cash price.

4) The basis is the difference between today’s price and the futures price for the nearest deliver month. For instance in our example the buyer bought the coffee for a 5 cent premium in May over the July futures price. This extra five cents is called the basis and is used to pay for the storage and insurance during the two months before it is shipped. As it gets closer to July the future price and current cash market price converge since storage and insurance are no longer an issue.

5) The price also depends on where the coffee is shipped. New York shipment is at par with the NYCE price for that month. New Orleans and Miami demand a 1.25 cents/lb discount, whereas San Francisco shipment has a discount of 0.75 cents/lb. The seller determines the delivery point.

6) The quality of coffee also affects the premium or discount paid for a coffee. There are five classes of coffee:

a) Class 1. Specialty Coffee – 0-5 defects.

b) Class 2. Premium Grade – 6-8 defects.

c) Class 3. Exchange Grade – 9-23 defects. This is the grade traded on the NYCE. Class 1 and 2 demand premiums to this price, whereas Class 4 and 5 coffees demand discounts.

d) Class 4. Below Standard Grade – 24-86 defects.

e) Class 5. Off Grade – More than 86 defects.

7) The producing country also determines the differential paid. Costa Rica, El Salvador, Guatemala, Kenya, Mexico, New Guinea, Nicaragua, Panama, Tanzania, and Uganda are at par (basis). Colombia has a differential of plus 200 points (2 cents/lb). Honduras and Venezuela have differentials of minus 100 points. Burundi, India, and Rwanda deliver at discounts of 300 points, whereas Dominican Republic, Ecuador, and Peru deliver at minus 400 points.

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