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JOURNAL | NEWS

SELLING PRICES FOR SPECIALTY ROASTED COFFEES

FROM THE UPPER END OF THE MARKET

DROP FOR THE SECOND CONSECUTIVE MONTH

As the Covid-19 pandemic progresses, an analysis of the sale prices of roasted specialty coffees in bags has shown a decline for the second consecutive month, particularly in the higher price ranges.

A recent report from Square and the Specialty Coffee Association documented several qualitative changes in the specialty coffee market in the wake of the COVID-19 pandemic, including an increase in take-out purchases and more home delivery options. To continue monitoring the evolutionary effects of the pandemic on coffee trading activities and retail sales prices, we have been monitoring the sales prices of specialty roasted coffees and other changes .

Consistently tracking the sample of the roaster group represented on the North American Specialty Coffee Retail Price Index (SCRPI) provides us with data that can shed light on monthly market adjustments as the pandemic continues.

A review in the last week of May of the websites of the 57 SCRPI roasters revealed several qualitative adjustments in roaster and cafeteria operations:

  • Four roasters removed COVID-19 references from their websites, while three added advertisements to describe new developments.
  • One of the three roasters that closed operations in April reopened in May.
  • Two of the several cafes that closed in April reopened in May.
  • Three coffee shops make announcements that emphasize health and safety practices.
  • Two roasters offer customers tips for making their coffees at home as they transition to higher consumption at home.
  • Five companies are implementing employee / barista support programs.
  • Five other companies have active community participation programs.

Many of these observations predict a slow return to a new normal for North American coffee roasters and specialty coffee shops.

The most interesting observation in May concerns the different retail price dynamics at the upper and lower ends of the specialty coffee market.

After falling 7.7% in April, retail prices for specialty roasted coffees continued to decline in May. About two months after the global pandemic, prices are down 10.4%. Most of this two-month decline is felt at the high end of the market. Average sales prices in the lowest segments of SCRPI roaster websites have increased 0.3% to $ 17.66 per pound of roasted coffee. However, at the upper end of the market, the average of the highest online prices has dropped 16.1% to $ 27.80.

Between the end of March and the end of May, there was considerable stability at the low end of the market, with the lowest prices unchanged at 41 online stores. The remaining SCRPI roasters are divided between price increases and decreases, with an average of five price decreases (- $ 1.56) that exceeds the average of nine price increases (+ $ 0.69).

At the high end of the specialty coffee market, the highest online prices were unchanged between March and May at 20 online stores. In 22 cases, the highest priced coffees decreased by an average of $ 17.55 per pound of roasted coffee.

This reflects a current “withdrawal without replacement” of many coffees considered ‘refined’ and high prices. In three online stores, the highest-priced coffees declined by more than $ 50 per pound. In three other stores, the decrease was between $ 20 and $ 50 per pound, while two other stores fell between $ 10 and $ 20. In 13 other cases, the highest-priced coffees increased by an average of $ 5.85 per pound of roasted coffee. Price increases were more than $ 10 in only two cases.

Although it is very early in what will be a long-term adjustment process, we are beginning to see trends suggesting that the upper and lower end of the internet sales market for specialty roasted coffees are reacting differently to the COVID pandemic- 19.

The relative stability at the low end of the online sales market seems to confirm beliefs about the general inelasticity of coffee demand prices. At the same time, the apparent departure from high-priced ‘competition-winning’ coffees is troubling when we consider these coffees to be market drivers and critical differentiators for producers and roasters alike.


Source: Daily Coffee News

Link: https://dailycoffeenews.com/2020/06/23/precios-de-venta-de-cafes-especiales-tostados-del-extremo-superior-del-mercado-caen-por-segundo-mes-consecutivo/

Translator: 43 Factory Coffee Roaster

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