🌟 Welcome to the June edition of the Bennetts Coffee Newsletter! ☕️

It's June, and while the weather might be cooling down, but our love for caffeine is hotter than ever! So, grab a cup of your go-to brew, get cosy, and prepare to indulge in some ripper coffee news and insights.

We've got the lowdown on the freshest trends in the green bean market, insights into the latest coffee trends, and updates straight from the heart of coffee origins.

ETHIOPIAN YCFCU AND FAIRTRADE EVENT UPDATE

Last month we had the pleasure of hosting an evening with Senthil CEO of Fairtrade Australia and New Zealand and Erkehun General Manager of YCFCU in Ethiopia.

This was a great opportunity for us to hear firsthand about the recent changes to the Fairtrade policy and pricing, alongside the developments from the YCFCU cooperative in Ethiopia. With recent years restricting us from events like these, it was great to see some familiar faces and connect with those within our industry. We had a great turnout, and are very thankful to all the attendees for supporting this event.

We would like to thank both Senthil and Erkehun for taking the time to speak to us and provide such valuable insight into the world of coffee.

We look forward to hosting more events like this in the future, so be sure to keep up to date with all our socials for details.

If you would like to view both talks, they are now up on our Instagram. We also have a copy of the slides used in Erkehun’s presentation, so please get in contact with us or your account managers so we can forward them on to you.

MARKET REPORT

NY C movements and the Brazilian Impact

The NY C market opened at 184.15 c/lb and spent the first half of the month trading sideways as market participants continued to wait for instructions from the upcoming Brazilian harvest. A balance of good crop news and potential murmurings of frost and high demand seems to be keeping prices in the balance around what could be deemed the fair value. We did see some upward momentum as it pushed towards 200 c/lb. We didn’t see it break through the resistance of 195 c/lb in the end though. In the second half of May we witnessed a downturn, falling for 6 days in a row. The US Dollar Index rose over this same period which in general is bearish for commodities, including coffee. The NY C settled at the end of May at 178.65 c/lb.

This isn’t the first recently that the Robusta market has stolen the show in the coffee market world, over the last 6 months the market has run up a mountain. It just needs the Rocky Balboa theme tune playing in the background. “Let me tell you something you already know. The world market ain't all sunshine and rainbows. It's a very mean and nasty place, and I don't care how tough you are”.

Wise words Rocky, thanks for your input.

The last time it’s current title of 2,675 US$/MT was challenged was in March 2011. Tight physical stocks from Vietnam and Indonesia combined with increased demand from roasters worldwide are still boosting prices. Some roasters are choosing to go without, with the thought process being, ‘why pay almost the same for Robusta as Arabica?’ But those who have developed key blends around it are finding they need it to keep the consistency.

Certified Stocks

Certified Arabica stocks fell to their lowest level for 6 months. Coming in at 583,000 bags in the last few days, they have reduced by nearly 30% in 2023. Brazilian diffs are likely to come off as the 23/24 crop starts to ship out, so we should see more coffee going to the board in the next few months.

Commitment Of Traders Report

The COT with the cut off Tuesday 23^rd May showed relatively little movement from last month’s report. The Commercials marginally reduced their net short position, to -61,867 futures lots, and the Specs reduced their net long position to 32,577 future lots.

The Wider Macroeconomic Impact

Most of the Macro talk in the last couple of weeks has been about the US debt ceiling. If this hasn’t come up on your news feed, it is how much the US Government can borrow without starting to pay it back. A recurring argument pops up when this limit is nearly reached as to whether the US should start paying it off, or whether they should raise the limit. The decisions and politics behind which is better is best saved for a different occasion. Plus, I asked Rocky, and he didn’t have anything to say on this subject.

Congress chose to raise the limit and make it a future Presidents problem. This decision is a stable option for the whole world, since $500bn worth of US debt gets traded every day and a deliberate default would send the financial market, and every other type of market into chaos. There is still confidence in the greenback but should confidence fall, we would see the impacts being felt in the coffee market and its effect on the Aussie Dollar, both effecting the prices roasters pay for the green stuff. At the time of writing, AUD was trading at 0.661 against the US Dollar.

SWISS WATER REPORT

Over the past month we have had the opportunity to catch up with some of the team form Swiss Water to learn more about their product and what it has to offer. Through our discussions we came to realise what the future has in store for Swiss Water coffee, and decided to put our collective thoughts in a short report to share with you all.

The Growing Trend in Decaf Coffee

The world of coffee has been evolving at a rapid pace in recent years, with consumers becoming more knowledgeable and particular about what they put into their bodies. One aspect of this shift has been a growing interest in decaf coffee and the different methods used to remove caffeine from the beans. In particular, the Swiss Water® Process has emerged as a popular choice for those looking for a 100% chemical-free decaf option.

Our friends over at the Swiss Water® Process team have delved into how and why this trend has arisen in recent months, providing a great insight into the future of consumer behaviours and Swiss Water Coffee.

One reason for this trend is the growing awareness among consumers about the potential health risks associated with consuming certain chemicals used in the decaffeination process. The Swiss Water® Process is the only natural alternative which is why it has gained traction as consumers seek out safer and higher quality options.

Another factor driving the move toward the Swiss Water® Process decaf coffee, is the influence of social media and other digital channels. As coffee lovers become more connected and informed, they are increasingly sharing information and opinions about different decaffeination methods. Influential social media accounts and bloggers, for example, have been vocal in their support of the Swiss Water® Process, praising its higher quality and health benefits. This has helped to raise awareness among a wider audience and drive demand for the only chemical-free decaf option.

Traditional media has also played a role in this trend, with major news outlets and publications covering the potential health risks associated with other decaf chemicals. In 2022 alone, more than 300 million people worldwide were reached by media coverage of the issue*. This has further fuelled consumer interest in healthier decaf options, and increased demand for the Swiss Water® Process as the only natural and chemical-free alternative.

Advertising and marketing efforts have also contributed to the rise of Swiss Water® Process decaf coffee. Roasteries that use this method have been promoting its benefits, highlighting its ability to remove caffeine without the use of chemicals, and emphasising the clean taste and quality of the resulting coffee. This messaging has resonated with consumers, and the Swiss Water® Process advertising has generated more than 100 million impressions in the past three years**.

As consumers become more aware of the different decaf options available, they are also taking more steps to ensure they are getting a chemical-free product. This includes researching brands and looking for information on labels and packaging that indicate the use of the Swiss Water® Process. In response, many coffee companies are emphasising their use of the Swiss Water coffee, and differentiating themselves from competitors by offering a premium product that meets the demands of health-conscious consumers.

Overall, the trend toward Swiss Water® Process decaf coffee reflects a larger shift in consumer attitudes toward health and wellness. As people become more informed and aware of the potential risks associated with certain foods and beverages, they are increasingly seeking out natural and organic options. This has created a growing market for the chemical-free decaf coffee, and a new standard for quality and safety in the coffee industry.

Here at Bennetts, we are the exclusive supplier of Swiss Water® Process in Australia and if you are a coffee lover looking for a health-conscious decaf option, consider trying a product that uses the Swiss Water® Process.

We have a wide variety of Swiss Water options available, ranging from our Classic and Premium blends to single origins from Colombia, Mexico, Peru, and Brazil. If you are interested, please contact your Bennetts Account Manager to join in on this fast-moving trend.

*Meltwater report. Some reach may be duplicated.
** US campaign across 12 major markets.

AUSTRALIAN SPECIALTY COFFEE ASSOCIATION (ASCA) COMPETITION UPDATE

Last month Melbourne hosted the Australian Speciality Coffee Association Coffee Championships in Coburg, in which competitors had the chance to compete in the Barista and Brewers cup events.

This year Bennetts was a proud sponsor of the competition, alongside having one of our own, Harry Ko, competing in the Brewers Cup. Harry placed inside the Top 10, and we are extremely proud of his efforts.

We wanted to say a massive congratulations to the winners of the 2023 Australian Vitasoy Barista and ASCA Brewers Cup Championships. It was a huge honour that both winners sourced their coffee from our team at Bennetts. We partnered with Lohas Beans, Finca Las Flores, and Finca El Diviso to bring these amazing Colombian coffees to the Australian market.

Jack Simpson, from Axil coffee, placed 1^st in the Barista competition using the El Divisio Ombligon Natural and Thomas Hutchins, from Code Black, placed 1^st in the Brewers Cup using the Las Flores Chiroso Natural in their winning efforts.

Both Jack and Thomas will be heading to the World Coffee Championships in Athens, Greece, this coming month. We are extremely proud that they will be using coffee sourced by Bennetts throughout their competitions. We wish them the best of luck, and cannot wait to see them represent Australia in a few weeks’ time.

KINGS BIRTHDAY CLOSURE AND WAREHOUSE STOCKTAKE

Please be advised that our office will be closed on Monday the 12^th of June for the Kings Birthday Holiday.

Please place your orders by 12.30pm on Friday 9^th June for despatch on Tuesday the 13^th of June.

Also please be advised that will be conducting our end of financial year stocktake at our Melbourne warehouse on Friday 23^rd June 2023.

Therefore, no orders will be despatched on this day.

Orders received and processed on Thursday 22nd and Friday 23^rd June. will be despatched on Monday 26^th and Tuesday 27^th June.

If you have any questions and or queries on these matters, please contact your Bennetts Account Manager directly and/ or the Bennetts office on 03 9853 0328 or trading@hab.com.au

Happy Roasting,
The Bennetts Team