The blooming coffee industry means that the role of a specialty coffee trader is more obvious and crucial than ever. Therefore, it is essential to acknowledge some of their most basic information.
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Overview of specialty coffee trader
Due to the rising demand for specialty coffee worldwide, specialty coffee traders have an important mission to execute: bring specialty coffee to those coffee-lovers around the world.
Definition of specialty coffee trader
A specialty coffee trader is an individual or a business that sells bulk coffee commodities to make a profit. They can be called a broker or act as an intermediary company between buyers and producers. They specialize in trading specialty coffee products with high prices and premium quality.
Locations of specialty coffee trader
Being the connector between the buyers and the sellers, most specialty coffee traders are located where the best coffee products are and where the demands are highest. Major coffee-producing countries in the world coffee belt, e.g. Brazil (about 3,558 million MT in 2020), Colombia (about 846 million MT), Vietnam (about 1,8812 million MT), all have specialty coffee traders of their own. They help tremendously in bringing to the world distinctive specialty coffee products of different regions and thereby diversify the coffee world.
Locations of specialty coffee trader
Types of specialty coffee trader
Specialty coffee traders can either work domestically or internationally, depending on their targeted customers.
- Domestic specialty coffee trader
This type of specialty coffee trader works between buyers and manufacturers in the same country, often bringing specialty coffee products from the manufacturers to coffee shops, restaurants, or wholesale coffee buyers within the country. Generally, the domestic price services that specialty coffee traders offer to those who have demand are cheaper compared to those living abroad due to the exemption of transportation and custom fee. These products provided by domestic specialty coffee traders can be used as ingredients for beverages at coffee shops, gifts for working partners or simply to consume at home.
- International specialty coffee trader
Having similar functions to domestic specialty coffee traders, the biggest difference lies in the territory that they work in. The main targeted customers of international specialty coffee traders are in foreign regions, both buying for retail or in bulk. Their mission is to export specialty and premium coffee products, both raw and processed, to the international market. This type of trader also has to take care of more complex and detailed steps, from finding suitable customers to carefully fulfilling and providing required documents. Since each country has different import terms and regulations, specialty coffee traders need to provide papers and documents tailored to those requirements, therefore their service prices are higher than those who work domestically.
Types of specialty coffee trader
Main products supplied by specialty coffee trader
Currently, in the trading coffee market, the two most prominent in terms of quality and rankings are specialty Arabica and premium Arabica, loved by many classy coffee connoisseurs around the world.
- Specialty Arabica
For the Arabica coffee beans to be considered “Specialty coffee”, it has to meet all the strict requirements, from farming controls, production, packing to preservation. Specialty Arabica has a mild sour and bitter taste with an elegant aroma. According to the Specialty Coffee Association of America (SCAA), coffee can only be certified as “Specialty coffee” once it scores above 80 points based on the SCAA’s scale. Currently, on the market, the price of Specialty Arabica ranges from 9000 – 11000 USD/metric ton, among the most expensive coffee types in the world. The U.S., EU, and Germany are some of the nations that import large quantities of Specialty Arabica annually.
Specialty Arabica
- Premium Arabica
Another type of coffee that specialty coffee traders focus on is Premium Arabica. Even though it is less expensive than Specialty Arabica (about 4500 – 5400 USD/ton), this type of coffee is still considered in the upper rank and among the highest priced coffee in the world. Top-tier quality, together with reasonable prices (compared to Specialty Arabica) make Premium Arabica coffee beans perfect for those who want to taste the finest flavor of coffee without having to spend tremendously.
Premium Arabica
These two types of coffee are all preferred by specialty coffee traders because of the economic profit they bring. With high prices and high demand, specialty coffee traders can always find potential customers, especially in the EU region.
See more: Vietnamese specialty coffee – a perfect drink for coffee addicts over the world
What can affect specialty coffee trader
Whether specialty coffee traders can be in business or not depends heavily on the output of coffee producers, market demand, rising competitors, and transport procedures in the trading world.
Coffee output
Arabica is a coffee variety that demands strict and optimal cultivation procedures from growing, picking, processing, coffee roasting process, to brewing. For the coffee to sustain its finest quality, farmers must put in much time and effort as well as have professional knowledge about coffee. However, a stricter process does not ensure a stable output since Arabica coffee trees are quite vulnerable and can give unexpectedly lower yields in years that witness severe natural disasters and disease. For example, the year 2019 saw a 5% decrease in global Arabica coffee output to 5,759 MT due to the dreadful Covid-19 pandemic. This makes the specialty coffee traders struggle to find a long-term source for coffee and can often push the prices of specialty coffee to a higher level.
Market demand
Despite the high prices, global demand for specialty coffee still goes up. For example, in Europe – one of the biggest specialty coffee importers on an international scale, the demand for specialty coffee consumption in the pandemic still remained strong, which was shown through their online sales growth. It is expected that the European coffee market will be able to level up back to their pre-pandemic levels at the end of 2022 or the beginning of 2023. Specifically, in 2021, the annual growth rate of this market is forecasted to be at 2.9%. Similar trends are also witnessed in other major coffee-importing regions such as Asia, which provide a great opportunity for specialty coffee traders to find potential customers and sell high-priced products.
What can affect specialty coffee trader
High competition
The bustling coffee culture offers various chances to gain profits, create jobs and contribute to economic growth, so it is only natural that more and more people are finding their ways to enter the business, both on a domestic and global scale. To be able to withstand and develop significantly in the business, specialty coffee traders must constantly work to improve their negotiation skills and find stable sources for specialty coffee beans’ quality to compete against other traders.
Transport costs and procedures
To international specialty coffee traders, transport costs and procedures can be a real headache during the Covid-19 epidemic. Lack of logistic workers and sea freight congestion are some of the causes that make specialty coffee traders bear higher fees only for transportation, causing coffee prices to skyrocket. However, now that the vaccination rate is higher internationally and trade borders are reopened, specialty coffee traders can finally get back to work without worrying that prices could increase.
Overall, the promising opportunities to thrive in this specialty coffee trading world always come with challenges. Therefore, specialty coffee traders must be quick and always be prepared for unprecedented events in order to enhance their position in the business.
Guidelines on how to work with specialty coffee trader
In order to cooperate with specialty coffee traders, both the buyers and sellers need to acknowledge the basic workflow in buying agricultural products.
- Price negotiation
For the most competitive price and to avoid being frauded, it is suggested to compare different specialty coffee traders on the coffee market via the internet or from customer feedback. Normally, traders will charge buyers and sellers with service fees so make sure to ask for any promotions or discounts in order to get the best deals. If buying in bulk, the price can be cheaper.
- Sample testing
Samples are very essential in determining whether the product quality meets your expectation or not and also to prevent purchasing low-quality goods or being scammed.
- Contract
The contract is the binding commitment of both sides, which can legally ensure that both partners are responsible and strictly follow what they have agreed on in the contract. For both sides to get the best possible profits from the deals and respect common law, it is important to double-check before signing and be certain that consent is being given by both parties.
Guidelines on how to work with specialty coffee trader
- Payment
The appropriate payment method will be suggested by specialty coffee traders based on the orders. It is more prudent to separate the payment into 2 phases: before and after receiving the products.
- Receive goods and feedback
Check carefully to see if the products meet the requirements as stated in the contract. If any problems occur, contact the specialty coffee traders to come up with the most suitable solutions.
Suggestion on the reputable specialty coffee trader in Vietnam
Among the popular specialty coffee brands, K-Agriculture is proud to be both the trader and the supplier of Specialty Arabica coffee with top-tier quality and reasonable prices. Powered by Vietnam’s Ministry of Industry and Trade, this company always ensures that the final products are high-quality, carefully produced, and strictly selected.
K-Agriculture – A reputable specialty coffee trader in Vietnam
For more information about specialty coffee prices and business, kindly contact us at:
Email: info@k-agriculture.com
Website: https://k-agriculture.com/
Whatsapp: +84855 555 837
