The past year of climate shocks and surging coffee prices has felt portentous. Without significant investment and industry cooperation, coffee’s future seems increasingly uncertain.
Coffee brands love to tout their ethics and human rights policies, yet the supply chain is still built on poverty. At some point, we have to judge the industry not by what it says but by its actions.
The coffee industry loves “community”, but it doesn’t always love the solidarity that the word signifies. Nowhere is this more obvious than in its reaction—or lack thereof—to the genocide in Gaza.
Good morning and welcome to another Coffee News Roundup.
Just a quick one this week, as there’s not a whole lot going on (apart from, y’know, [gestures at the world]).
COVID-19 Updates - Via Various
Not much has changed since last week. Most coffee shops are closed, many many baristas are out of work (help them here if you can), and if roasters are still going they’re working at lower capacity. Let’s see what’s been happening:
Two Italian coffee machine manufacturers, Simonelli Group and Dalla Corte, have pledged to assist their local hospitals with financial aid and equipment. Both companies are based in regions badly hit by the cornavirus outbreak, and have provided money for ventilators in Simonelli’s case and “part of our income” for three months from Dalla Corte. It’s not specified exactly how much each company is giving.
In Brazil, with the start of the harvest season rapidly approaching and a government seemingly not willing to take the situation seriously, things are looking increasingly precarious for coffee farmers. Farm owners are worried that they won’t be able to find the workforce needed to ensure the harvest is complete, and don’t know how they’ll handle an outbreak if one does occur on their farms. (The Bloomberg article, unsurprisingly, doesn’t give much thought to the workers themselves.) These worries have translated into an uptick in the price of commodity coffee, up 13% over the past few weeks, as traders fear shipment delays and a potentially weak harvest due to the pandemic.
An opinion piece in Daily Coffee News suggests that the coffee price crisis will be worsened by the global coronavirus pandemic (small blips like the one above notwithstanding). Peter Roberts and Chad Trewick, who lead the Specialty Coffee Transaction Guide, argue that the pandemic “will drain the collective interest in paying producers appropriately for their coffees, and that commodity markets will continue to ensure that we do not have to.” They write that “people will keep drinking coffee. They just won’t have the emotional or economic energy to ask whether coffee producers are getting paid.”
Although many coffee shops are closed, some are staying open and expanding their selection by becoming mini general stores for their communities. This Sprudge article highlights some of the efforts, from cafes selling eggs and bread to granola and even seafood. “Our company exists to serve our community and this is exactly the thing people need. It’s more pleasant, sanitary, and delightful than going to a grocery store right now by an order of magnitude, and our community has responded positively,” says Kyle Glanville of LA’s Go Get Em Tiger, one of the companies featured in the article.
Luckin Coffee COO Fabricated $310 Million in Sales, Company Finds - via Daily Coffee News
This is the big non-COVID-19 story of the week. Luckin Coffee, the darling of the financial news media and the company assumed closest to challenging Starbucks for global domination of the coffee industry, has found in an internal investigation that its COO and other employees fabricated approximately $310 billion in sales.
That number represents more than 40% of Luckin’s estimated annual reported revenue for 2019, which is also the year the company went public with a $4.2 billion valuation.
Luckin grew to prominence with an unprecedented cafe growth spurt, going from nine stores at the end of 2017 to more than 2,000 by 2019—it now operates more than 3,500 across China.
As of Friday, Luckin’s stock price was down 75%. According to Daily Coffee News, Luckin has said it will take all “appropriate” action, including “legal actions against the individuals responsible for misconduct.” Which… let’s just say it wouldn’t surprise me if we found out some more information in the coming weeks.
Another week without news of some company’s great plan to combat whatever by giving a tiny bit of money and then basking in the free publicity. It’s almost like brands are learning not to mess around when 6.6 million people just filed for unemployment over the past week.
Although, that story about Simonelli Group and Della Corte smacks a little of something-washing, as it doesn’t actually contain any information on how much they’re giving. It just sort of… says they are. Hmm.
Is coffee good for you?
Not sure if this is good news or not, but according to Sprudge“only 30% of people feel the laxative effect of coffee.”
Granted this is based on an article in Popular Science(promoting a podcast) about a study that was done in 1990 with just 99 participants, and the whole thing smacks of “oh god we need new content please someone find something”, but hey it’s technically possibly maybe health-related?
