As we head into the last quarter of this year, we hear that old catchcry “where has the year gone?!”

Maybe we need another coffee to keep up!

MELBOURNE INTERNATIONAL COFFEE EXPO

Unless you were living under a rock, you would have noticed that last week the 2022 Melbourne International Coffee Expo (MICE) was held at the Melbourne Convention and Exhibition Centre. Boasting the largest crowd in the history of the event, over 15,000 attendees passed through the doors over the four days. Visitors came from far and wide, with over 70 international countries being represented alongside our Aussie locals. 

While the expo was a great opportunity for us to see both customers and suppliers in one place, we were particularly excited to attend this year, as our very own Harry Ko was representing Australia in the World Brewers Cup competition (the World league was held at MICE this year). If you have been following the success of Harry’s Brewers Cup Competitions this year, you will know he took out first place in both the Southern Regional and National Competitions over the past few months, which gained him entry into the World Comp. 

Over 30 International competitors took to the stage at MICE to battle out their brewing prowess – round one was fierce and the scores were tight, but there could be only one winner. Unfortunately Harry just missed out on making it to the final round, but we are thrilled that he came in at 8th place for the first round. Well done Harry!
 

MARKET REPORT

Our Key Account and Trading Manager Alex Capurro, visited Brazil last month.  Amongst his many stops, he visited a third-generation producer, Veloso Farms in Cerrado, near Carmo do Paranaiba.  Veloso Farms span 5000 hectares with 8 farming units. The company is Rainforest Alliance Certified, and usually produce 35-40 bags of ungraded green coffee (known as bica corrida) per hectare. One of the farming units has an active cattle and pig feedlot, and the farmers use the manure mixed with coffee waste material to produce compost. This reduces their fertilised use by between 20 and 30%. 

At Veloso, the farm irrigation system allows the farmers to control water access by the plants, and turning off the irrigation for a period of time stresses the plants and induces flowering. Being fully drip irrigated gives the farm an advantage on crop yield, however the extended period of drought this past year has meant yields are down at least 20%. They are in a fortunate position due to their irrigation infrastructure in place, but if it does not rain enough during the wet season (generally spanning from September to January/February), their water reserves will only get them so far. 

On the topic of drought, Brazil's arabica-growing regions have already been going through a second year of severe water deficit. There are a number of ways this can affect potential coffee yields:

1) If the coffee tree is too stressed due to the lack of water, it can "choose" to grow new leaves instead of producing flowers, thus reducing the potential production of coffee the following harvest.

2) If the tree flowers and there is not enough follow-up rain (at least a good 40 mm), then a good portion of the resulting fruit drops off the tree, as the plant does not have the capacity to maintain a large number of cherries into the future.

3) When there is drought, the tree itself does not grow as much. Given that fruit is only produced on new growth, if the trees don't grow well this year you can expect to have a lower yield the following season, so we could already expect a reduced crop for 23/24 season. 

This season they are already seeing a reduction of Brazil’s 22/23 arabica crop as a result of last year's drought, which is on top of the losses already incurred due to last July's frost. If the current rainy season is good, then potential losses may be reduced (but probably not completely avoided next crop).  

As for prices, the NY “C” remained range-bound and extremely volatile for the most part last month. This was in spite of good rains falling across Minas Gerais and Sao Paulo states, which one would have expected to cool the hot market down somewhat. 

 

However, as forward business has been somewhat thin of late across the wider industry due to so much uncertainty with regards to demand, this has led to a higher level of speculator participation (and market manipulation) in the coffee futures market than we’re usually used to. So, until such time as we get a better sense of what next year’s Brazil crop looks like, we should expect a bit more of the same. 


A WORD FROM THE CUPPING ROOM

This week we had the pleasure of hosting Pedro from Brazil. Pedro is a coffee trader from SMC Specialty Coffees based in Guaxupe, Minas Gerais. SMC (established in 2009) works closely with Cooxupe - the largest private cooperative in Brazil (established in 1957), to select the finest cupping lots from the coop’s incoming offerings. Cooxupe has 17,000 producing members, and a whopping 6,300 cups need to be cupped in the lab every day. When the cuppers come across a coffee of interest, SMC take the opportunity to segregate the batch and process it at their private mill, giving it the extra care it needs to keep the quality and integrity of the lot. 
 

SMC also work directly with small family farmers in the specialty sector to provide a transparent relationship between the producer and exporter. They share technical knowledge with the producers, aiming to improve production, recorded biography of the farm, projects and initiatives that provide business opportunities to the growers. 

One such initiative that Bennetts are getting behind is SMC’s “Donas do Café” which translates to Ladies of Coffee.  This program is based around knowledge exchange that assists the work of women coffee producers in the region. All members of the Donas do Café not only own their own farms, but are involved in all the decision making including farming,  production, business management and financial control. SMC found that when a ‘woman in the community prospers, so does everything around her’.   Within the project, the women organise meetings and share information about the coffee market, demands, expectations, news and harvest knowledge. An agronomist leads the meetings ensuring the women are kept up to date with the latest agricultural technology. All Donas Do Café lots are made up from the harvest of several smaller producers, and blended to create a sweet, clean coffee with bright acidity. The initiative started in 2020 – and initially broadcasted their meetings online due to the pandemic, but have since had successful in person meetings developing successful and solid partnerships that will help women grow. 

The future of coffee is Women!

This season we purchased two lots form the Donas do Café initiative, along with a range of other amazing single farm lots from SMC. If you want to learn more about our selection, please contact your Bennetts Account Manager. 

 

WAREHOUSING

Notice to our valued customers. 
Due to a national shortage, CHEP branded Pallets are in short supply at 3PL and Warehousing providers across the country. 
As a result of this national shortage, you may see some of your goods delivered on plain skid/pallets, we apologise for any inconvenience this may cause. 

We are monitoring the situation on a weekly basis– however it is still important that roasters with a CHEP account remain vigilant about swapping empty CHEP pallets upon receipt of each delivery. Your cooperation with this is greatly appreciated.
 

Happy Roasting,
The Bennetts Team