When you go to your favorite coffee shop and order an espresso or iced latte, it’s the easiest transaction in the world, right? The barista takes your order, you tap and pay, then you get to enjoy the delicious taste of coffee. The chances are, though, that you’ve never thought about how exactly the coffee makes it into your hands.
This raises the question: how does the modern-day coffee supply chain actually work? After all, those coffee beans don’t just magically teleport to consumer cups.
Well, you’ll be happy to know that the following guide will answer this question in in-depth detail. By the end, you’ll understand the true magic behind the coffee you drink.
Overview of the Coffee Supply Chain
The coffee supply chain starts with farmers who harvest the coffee beans. From here, the coffee beans are passed onto processors and exporters. Then, the coffee beans will be exported to reputable green coffee importers. The job of a coffee importer is to sell to a roaster, who must then roast the coffee beans. Once roasted and packaged, the coffee beans can then be sold to supermarkets, coffee shops, and all kinds of other businesses, which is where (ultimately) consumers can purchase the coffee they love!
Make sense? Great. Now, here’s a detailed, step-by-step look at how the coffee supply chain works.
Step 1: Farmers
Firstly, coffee beans are harvested by farmers and growers.
This can work in one of two ways:
- Strip picking. The coffee cherries are stripped off the branches by hand or machine
- Selective picking. Only the best and ripest coffee cherries are harvested. They are specifically picked by hand
Primarily, coffee is harvested in Central and South America, Africa, and The Middle East.
Step 2: Processors
Next, farmers will then pass on the coffee beans to processors. This is so that the coffee beans can be hulled, dried, and cleaned. In the coffee supply chain, the processing part is very underrated because it ultimately helps to ensure that the coffee beans are in a good enough condition to make it to the next stage.
Step 3: Exporters
Once the coffee beans have been processed and given the green light, exporters will buy the coffee from multiple farms so that they can then sell it to international buyers all around the world. The exporters are experienced in sales and finding the right buyers, which is why the farmers need their help!
Step 4: Suppliers (Importers)
This is the part where the coffee suppliers get involved.
Suppliers will buy coffee from exporters in different countries, such as Brazil and Columbia. Then, suppliers will sell the coffee beans to roasters, which is where the supply chain starts to get really interesting.
Step 5: Roasters
The roaster’s job is to take the coffee beans and put them through the roasting process. There’s a lot of skill involved in roasting coffee beans. Naturally, each roaster is different in their approach. It’s fair to say that a one-size-fits-all approach doesn’t exist when it comes to roasting.
Roasters can do light roasts, medium roasts, and dark roasts. In today’s world, medium roasts are most popular with consumers, but everyone is different.
After being roasted, coffee beans can then be physically ground, brewed, and (finally) consumed by customers. Without first being roasted, though, this is simply impossible.
Step 6: Supermarkets, Coffee Shops, and More
Once coffee beans have been successfully roasted, they’ll usually be packaged, branded, and then shipped to supermarkets, coffee shops, and other destinations by the roasters.
Note: in some cases, roasters will sell coffee directly to consumers online. However, this is less common these days.
For example, your favorite coffee shop gets its coffee from roasters. Similarly, whenever you go to a hotel or supermarket, they’ve also obtained their coffee from a roaster or wholesaler.
Once the supermarkets, coffee shops, and other businesses have got the coffee they need, the next (and final) step is to sell it to the consumer.
Step 7: The Consumer!
After all of the above steps have taken place, the coffee can now be poured into the consumer’s cup. Hooray!
In 2023, the price of coffee has significantly increased. When you go to a coffee shop and make your order, you’re going to be paying 6% more than you used to. However, the good news is that coffee (no matter where you buy it from) still tastes as good as it used to. In fact, coffee tastes better than ever before, which is primarily thanks to smoother and more eco-friendly supply chains that are focused on quality over quantity.
What Is the Current Demand for Coffee?
In the post-pandemic era, countless supply chains in different industries have started to struggle. This has resulted in many businesses – small and large – completely collapsing. In some cases, coffee farmers have really struggled, and many local coffee shops have had to permanently close down due to unsustainability.
Despite all of this, the demand for coffee is still high. Sure, more people are working from home, but they still want their morning hit of caffeine! This is why most of the coffee stores owned by big brands are still packed with people every morning and afternoon.
According to GlobeNewswire, the global coffee market is expected to reach a value of over $652.31 billion by 2027, growing at a CAGR of 5.76%. This is pretty impressive and shows that the demand for coffee shows no signs of slowing down. As a result, coffee supply chains will need to keep adapting and stay focused on maximum efficiency. Also, over the coming years, there’s going to be an even stronger focus on sustainability and eco-friendliness, which is something that coffee consumers care about a lot.
So, there you have it. You now understand how the coffee supply chain works.
Of course, not every coffee supply chain works exactly the same way, but you get the general idea.
The journey starts with farmers before eventually ending with happy consumers. And as Hugh Jackman once said, “The smell of fresh-made coffee is one of the world’s greatest inventions.”