Wednesday, , December 22, 2021 The Nugget Newspaper, Sisters, Oregon
21
Will a cup of coffee get more expensive e in Sisters?
By Bill Bartlett
Correspondent
No, you won9t need a
bank loan for a cup of coffee.
But you will pay more.
The business press has
been ablaze about the rise in
the price of coffee beans 4
by some accounts over dou-
ble in a few short months.
Arabica coffee bean futures
slated for March delivery
rose as high as 4.8 percent
to $2.235 a pound a month
ago, Bloomberg reported.
Prices on November 12 were
up more than 90 percent over
the prior year and reached
their highest level since
October 2014. And rose
further.
On December 14, the
futures price dropped to
$2.35 from the December
6 high of $2.50 per pound.
Commodity prices fluctuate
widely and are often wildly
sensitive to virtually every
facet of trading 4 weather,
shipping delays, pandemics,
political uncertainty, mon-
etary policy, etc. Trading in
commodities is not for the
faint of heart.
So if coffee beans have
doubled or will double in
price by March, will a trip to
Fika, Dutch Bros., Twisted
Juniper, or Sisters Coffee Co.
necessitate a bank loan? Not
even close. Only five percent
of that cup of joe on aver-
age is for the beans. Cups,
stir sticks, lids, and sleeves
are about a dime of the total.
Labor, also on the rise, is
30 percent, as is overhead
4 rent, insurance, utilities.
Espresso drinks have added
costs: flavors, syrups, lots of
milk, some of which may be
the more expensive soy or
almond variety. All of these
are up substantially since
January.
Say the cost of beans
doubles. Roughly 15 to 20
cents of your caffeine jolt
might bump your total price
by no more than 25 cents,
and only if the shop passes
on the entire cost. Michele
Hammer, manager of Fika
Sisters Coffeehouse, has
seen these bean cost spikes
before. Her greater worry is
shortages, not prices. Paper
cups are the hardest thing
to find, and the popular café
has been forced to take odd-
colored cups not characteris-
tic of the season to fill drink
orders.
Hammer said, <We have
held our prices through the
holidays to benefit our cus-
tomers but we will have no
choice other than to increase
prices in January 4 our first,
really, since opening.=
Wh
Where
it gets tricky is
with packaged
p
coffee that is
mostly beans 4 whole or
ground Again, don9t expect
ground.
a bag of coffee to double if
the pr
price of beans doubles.
Of that
tha bag, roughly 11 per-
cent goes
go to the grower. The
proces
processor and exporter get
aroun 26 percent of the
around
total, and the roaster gets
about 55 percent, according
to Vis
Visual Capitalist. Thus,
if the grower gets twice last
year9s take, that9s 11 percent
doubled, not 100 percent
doubled.
However, the price of
beans is no small mat-
ter to Sisters Coffee Co.,
where a bag of their prized
Mekurya Basa already
retails for $21.25. Nothing
on their shelf is under $14.
And it9s not just the price at
the source but the cost and
frustration of getting a 152-
pound burlap bag of green
beans from as far away as
Ethiopia to Sisters, Oregon
4 an 8,500-mile journey.
Most of Sisters Coffee9s
bean purchases come from
Central America: Guatemala,
Honduras, and Panama. Not
exactly around the corner.
The logistics involve three
Outlaws set for athletic future…
PHOTO BY JERRY BALDOCK
Standout volleyball players Sidney Myhre, Greta Davis, and Bre
White came together last week to sign commitments for college,
where each will continue to pursue their careers on the hardwood.
federal agencies: Customs
and Border Protection,
the Food and Drug
Administration, and U.S.
Department of Agriculture.
We take a lot for granted
when we consume coffee.
It9s not only the cost of
beans that gets the attention
of Justin, Jesse, and Jared
Durham, the sibling trio who
own Sisters Coffee. Every
component of their operation
costs more, from baking flour
to fillings. They believe they
can manage the cost side of
the problems fairly well. The
bigger issue is supply. Like
Fika, <hot to-go cups, for
example, are out of stock,=
Jesse laments. <Things that
used to take eight weeks to
get are now 24 weeks.=
The Durhams have
reached the threshold where
they now must pay the new
Oregon Corporate Activity
Tax (CAT) imposed on busi-
nesses with gross receipts in
excess of $1 million. <That9s
another cost we have to con-
tend with and that inevitably
has to factor in to our pric-
ing,= Jesse said.
The Durhams usually
adjust prices annually. This
year will take extra scrutiny.
Sisters Coffee Co. may be
the best local example of the
pact of global commodity
impact
sues.
issues. They are not alone.
aird Superfood, whose key
Laird
roducts
products are complemen-
ry to coffee consumption,
tary
port large quantities of
import
gredients,
ingredients, including coco-
nut milk, coconut oil, organic
red d palm oil, cocoa, and
eruvian coffee beans.
Peruvian
Their sales growth
has been nothing short of
spectacular, rising 45 per-
cent when comparing the
last quarter to a year ago,
although their coffee, tea,
and chocolate products actu-
ally declined from $2.15
million to $1.72 million.
Coffee creamers grew from
$5.3 million in the quarter to
$6.5 million, illustrating the
impact of the coffee-related
business in Sisters.
Holy Kakow, a Sisters
company The Nugget wrote
about last spring, makes syr-
ups for coffee shops. Wyatt
Woods, founder and CEO
said, <We are seeing raw
material costs, depending on
the product, increase from
25 percent to, in some cases,
over 100 percent and lead
times for some of our needs
clear into the third quarter of
next year.=
The bulk of their pack-
aging and ingredients are
foreign-sourced.
In spite of it all, coffee
consumption shows no letup.
In the United States, annual
per capita consumption is
about 9.7 pounds, a slight
gain over 2020, making the
U.S. only the 25th biggest
consumer of coffee world-
wide on a per-person basis.
The average American con-
sumes about three cups of
coffee per day.
Wishing you a safe & happy
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