Thoughts on the last Esmeralda auction

According to the owner of the stoneworks auction website, I was one of up to 3000 users watching or participating in the latest auction. It went on for 9 hours and you had to feel very, very sorry for the Japanese who would have started bidding at 10pm and finished around 7am. (though you suspect they probably had access to sufficient caffeine)

I am not going to go through who won what (it is there on the website still) but there are a couple of things about this auction process, about the success of this farm, that I want to write a little about and get some feedback on from the community.

First of all I was quite surprised that the Petersons decided to auction off so many small individual lots. The high prices achieved in the past were a function (in my mind) of both quality and scarcity. I don’t debate the mesmerising cup this coffee is capable of producing, but I don’t think that it would have reached $130/lb last year if there had been 10 times the volume available. Granted, the small individually processed batches have drive the price up on the top lots to similar heights but this then leaves the issue of how to communicate the difference between Stumptown and Sweet Maria’s $105.25 lot and a $6 lot. What key areas would the consumer respond to and be willing to massively increase their spend for?

The variation in price also implies a variation in quality. This is not a criticism of the farm – no farmer in the world is going to claim they produce nothing but exceptional coffee. I do worry, however, that there is potential to damage the brand. (and I have no doubt that it is a brand now) I have seen more extreme examples of this in other super-farms such as Daterra. Daterra is a cutting edge farm, capable of producing stellar coffee, and the research they are involved in is invaluable. I know they did a great deal of work on tracing aroma in the cup back to the crop with Illy and I hope eventually some of that research will see the light of day. What surprises me is that they have not distinguished very strongly between their best lots (like the reserve) and then other lots which don’t taste as good. I have seen several roasters proudly claiming the Daterra component of their blend without specifying which one it was and the coffee not tasting great. I thought the idea of the Esmeralda Especial worked well, but was still being muddied by some people so if anything I would have thought they would have distinguished lots even more aggressively.

I feel very strongly that for us to really move forward in speciality coffee we must consistently deliver on our promises to the consumer. Asking them to pay a high price for a cup promises that it will be worth it, and making proud boasts about the coffees we use promises that they will taste something that will be starkly different, discoverable and satisfying. Will every single roast of the Esmeralda be great this year from all the different companies? Does a new, but interested consumer, tasting an average cup of Esmeralda leave them very confused about the prices of the higher lots? Do we risk looking exclusive rather than inclusive to those teetering on the edge of becoming interested and excited about great coffee?

My other thought on the success of the farm has been the double edged sword of the visibility of the Geisha varietal used. I travelled a little bit in Costa Rica last year and every farm I visited had at least a little Geisha planted. Some were more cautious than others in the space they were giving over to the gamble. In three or four years will we see a sudden flood of Geisha on the market (which will immediately drop its desirability) and will it be any good. A while ago I dug through my coffee text books to see if I could find any references to the varietal. I found very little except for a small study carried out abotu 40 years ago in Costa Rica comparing the success of various varietals of which Geisha was won. It lost out primarily because of its lack of yield – less of a problem if you have quality and scarcity on your side, but with lots of people suddenly producing lower yields from their farms scarcity becomes void. No notes are made in the study about increased cup quality, but that study could still easily be dismissed as techniques have moved on and you could also argue that Costa Rica’s quest for yield held it back as an origin producing distinct and amazing coffees until the more recent micro-mill revolution that we are seeing signs of. (if people want me to dig up the study I can do)

On this subject I am very happy to concede I might be wrong. I haven’t spent enough time at origin to feel completely confidant in the above statements, and if Peter or Geoff or anyone else who has spent a lot of time at origin are reading and want to correct me I would be very grateful. I really just want to learn more, and hope that we aren’t all debated-out on this issue which covers just about all of the coffee industry.

15 Comments

  1. “..see the light of day”

    This might just be your best post ever…though I suspect that after that string of questions in the fifth paragraph you will be forced to start posting on barismo. I’ll add you to the contributors list…

  2. It’s my understanding that Geisha was a mediocre tasting coffee until it was planted at higher elevations. That could account for the lack of any notes on improved taste in the study you cite.

  3. We purchased a batch of this coffee and, I have to say, the quality of the cup of found in the batches was not reflected sequentially in the order they were offered… The prices fetched for the top three did not make any sense for the spectrum of quality offered in the lots. Some people just go for #1! No matter what that number represents! Mmmmmmmmm, #1…

  4. James,
    Great post. Agreed that HiE is now a brand, with the caveat that it’s moreso for an “insider” than typical coffee drinker – even one that’s fairly picky.

    As for the quality assessment and marketing – it’ll be interesting to see how Stumptown markets it as well as those who purchased the “budget batch” at ~$6/lb (which would include our shop).

    All I can tell you for certain is the following: we didn’t cup it as we didn’t want to invest a chunk of change for that privilege. Rightly or wrongly, we simply figured it was going to be good based on what we were hearing. But, the guys who did our buying did cup it. While acknowledging that Batches 1-3 were superior and that some of the other batches from “South of the Creek” might have been slightly better, the ones from batch 5 were also excellent – not “average” coffees.

    At $6.00+/lb green ($8+ landed), even the “budget” lots are 4x Fair Trade and 2-3x most Direct Trade coffee, so there will be an high expectation of quality.

    We’ll be telling people exactly what it is – the part of the farm where it was harvested, tasting notes, etc. with no suggestion that it was the highest priced version. We’ve already started that process on our website, including a link to who paid what on the auction site.

    We’ll also be copying what a number of other retailer have done and taking orders in advance with full disclosure.

    I can’t say that that’s going to stop a customer from thinking whatever they want to think. But I also think that, this being the first year the Peterson’s have done this, that succeeding years may see the prices of ALL batches increase. I’ve already heard some folks kicking themselves that they didn’t participate (“…had I know I could get some for $6…”).

    Besides, at the moment we’re more excited at the prospect of working with some of our purchase as an SO espresso.

  5. reminder to self… proofread before “enter”! apologies for the spelling errors above.

  6. It’s funny you mention Costa Rica.

    I see some parallels between the Esmeralda and Geisha fad / craze today and the history of Centrals in the 1970s, when a few forward-thinking, cutting edge new breed of specialty coffee roasters discovered for the first time single origin Central American coffees (namely from Costa Rica and Guatemala) that had something in them that they had only ever had from Kenyans before: acidity.

    It’s hard to find written-down history about this, but if you get a chance to talk to any second and third generation roaster (with family roots going back to the 70s and 60s), they might all tell you the same thing – back then, this “amazing new taste sensation” of brightness was heavily sought after because these roasters were so used to the homogenized centrals with medium-low acidity, and the low acid / brightness coffees of Colombia and Brasil. Certain specialty roasters valued and praised this brightness more than anything else on the cupping table, and while they weren’t paying $50 or $100 or $130 for a pound, they were paying a premium and demanding more of the bean.

    As I said – lots of parallels there. And perhaps some lessons to be learned.

  7. PS – if you ever wonder why the SCAA cupping sheets are so heavily weighted on acidity / brightness, the reasons are simple – look at Ted Lingle’s background – Lingle Bros. were one of those “forward thinking” roasters in the 1970s and early 80s.

  8. I think the flood of geisha coffee in 3 to 4 years will be particularly interesting to follow. Although I suspect it will take quite a bit more time to get this point, I could see Esmeralda eventually plagued by the same issues that Hawaiian farms are now combating with the dilution of the Kona name by low grade versions or significant blending, or the similar issues that face farmers of the good Blue Mountain varietal.

  9. I think some of the Esmeralda lots that weren’t super expensive are still worth it. The lot I tasted last year that wasn’t sold in the auction was very nice – mindblowing when the roast was nailed. This year’s is being vac-packed. The expensiveness of the super auction lot is mostly irrelevant! I’m optimistic!

    To me, the ability to taste harvests from different sides of the creek and harvest dates is the best kind of cerebral treat a cup of coffee can offer. I thank Esmeralda for the opportunity.

    I have tasted a few “Geishas” from other farms. Maybe 20% of them simply aren’t the same Geisha from Esmeralda, because the beans look completely different and have none of the Esmeralda fruit and florals. I have little insider info on this stuff, so hopefully someone else can enlighten us.

  10. I think your so right about the potential flood. I also expect to see this kind of knee jerk happen more and more. The flood of pacamara’s in this years El Salvador COE I think will see many more entered next year thinking this is what jury’s want.

    I think the thing with Geisha and to an extent pacamara’s, are they are very obvious on a cupping table. Lazy cuppers (and I don’t know who judged the Panama auction or El Salvador and I’m not passing any comment on there quality) pick them out because they are so different. Does this make them better coffee’s because they are different?

    I think we are a dangerous and difficult cross roads of coffee. Following the latest fashion with people who can ill afford to react to this, and can damage years of varietal history for the sake of a whim. Will this improve coffee quality in the long term?

    I don’t know enough to be an expert on this stuff, but I know enough that it could be dangerous.

  11. Not to doubt the quality of the coffee (i’ve yet to try some) but like any product, it’s only worth what the customer will pay for it.

    i think your right to be concerned jim, not so much about the potential flooding of the market, as the next fashionalble variatal will be just around the corner, but the issue you raised re: branding.

    the end users lookm for brands, they always will do, so if you tell someone that Esmerelda is the pinnacle of coffee, its gets known for this. serve them a bad cup from a lower quality batch form the fram and that brand is being damaged.

    The farms have used basic economics to create an inflated price, now they have to apply basic marketing to ensure that the reputation of the farms and the brands they have established do not suffer from dilution.

    thoughts?

  12. James, great post and topic. We ended up sharing two of the lots, number 8 and number 6 with Zoka. We cupped and scored every batch (10 in all) and based on our scoring decided which lots we were interested in buying. I was personally amazed at the price Stumptown was willing to pay for the first couple of lots. We also had a buying group assembled for lot number 2 and bailed after the price jumped over $50. At the end of the day I am proud of what the Peterson’s have accomplished. They run an amazing farm and are working hard to promote the coffee they dote on. I think there is ample room for confusion in this HiE brand as a result of us paying $13.50 a pound versus the price Stumptown paid. Accordingly, we will not charge as much for our product as I guess ST will. Hopefully roasters who paid $6 per pound won’t try and extort customers on the basis of the ST price paid. At the end of the day, I think that the auction gave more access to the Peterson’s product, which is a good thing overall.

    As to the growth of the varietal, I too think it is problematic. Geisha does well in Panama at high altitudes and with the right micro climate. This is not to say that it can’t grow in other countries, but from the Panama experience, Geisha grown at lower altitudes is not a great coffee. We tasted some pretty bad examples of bad Geisha in Panama this year. Like everything else, just because someone has great success with a specific coffee, does not mean that everyone can. Part of what makes the HiE Geisha so amazing is the care with which they harvest and process the coffee. It is one of the reasons I am going back to Panama in January, so that I can witness the harvest first hand and better understand all of the issues facing growers of specialty coffee. Anyway, my two cents worth. Can’t wait to get over to London and visit.

    Cheers.

  13. A thought-provoking post, James (to which I come late to respond)…

    but this then leaves the issue of how to communicate the difference between Stumptown and Sweet Maria’s $105.25 lot and a $6 lot.

    However, this statement to me seems to imply that the difference in price between a “top” lot and a “budget” lot (of which I am one of the buyers) reflects a similar difference in quality. But in my cuppings of the lot-samples I could not detect a difference in taste or quality which would warrant such an enourmous difference in price of the lots in question.

    As much as it would deem unfair to me would a buyer of one of the “cheaper” lots try to make it appear he is now selling coffee worth more than $100/lbs, as much would it deem unfair to me would the buyers of the top lots now try to communicate that there exists a difference in quality/taste of these lots which warrants such a difference in price…

    Just my 2 cts…

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