The story behind your coffee price

AMY JACKMAN
Last updated 12:25 10/07/2014

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Feeding a coffee habit can be expensive.

Ten cups of coffee a week can cost upwards of $45 in Wellington, even with that prized free one at the end of the coffee card. It also seems that the price is always rising, regardless of the cost of milk or coffee beans.

Or should that be the perceived cost?

There is some debate at the moment about whether $4.50 or $5 is too expensive for a cup of coffee.

Earlier this year, Mirela Martinescu opened Coffix, a coffee kiosk in Karangahape Rd, Auckland. It sells a cup of the brew for only $2.50.

There is no extra charge for soy milk, syrup shots or other variations. It's $2.50 for anything.

Wellington was recently rated one of the world's best coffee cities by CNN and as a country we are the 15th highest consumers of the beverage per capita.

But, according to Flight Coffee, the cost of a cup of joe is seriously misunderstood.

"I actually find the obsession with the price of coffee to the consumer in New Zealand hilarious," Flight director Matt Graylee said.

"[The talk] is astoundingly always with the assumption that all coffee is the same.

"This is clearly ridiculous. That is like saying a 99c hamburger from McDonald's is the same thing as a Wellington on a Plate award-winning burger from Ti Kouka."

Point taken.

So what goes into making up the price?

"If you are chowing down a cardboard burger at 3am for a dollar, you are probably doing it with the added ambience of flickering fluorescent bulbs," Graylee said.

"The price of coffee in the Hangar [on the corner of Willis and Dixon streets] cannot be lower.

"Rather, it could be, but at the expense of something else - service, quality, ambience, farmers' lives.

"We aren't the choice for everyone in the market, don't expect to be, and, of course, cannot possibly be. Instead we are doing what we do, and what we do for the costs incurred, value added, and prices charged works for some consumers.

"We could indeed change everything about The Hangar with the goal of producing coffee for $1 a cup - but that wouldn't be The Hangar, would it?"

Flight Coffee is not just a coffee shop and roastery, it also owns New Zealand Specialty Coffee Imports and co-owns Raw Material export company in Colombia.

The importance of paying a fair price to Colombian farmers went into making up the price of a cup of coffee.

"The price of coffee changes wildly, but the costs to the farmer do not," Graylee said.

"Coffee is Colombia's largest export, but many farmers are too small to directly export their product, so have to settle for low commodity prices."

Raw Material helped farmers sell direct to buyers overseas and helped them develop higher-quality product.

"Often farmers of coffee find themselves with a product they can only sell for a price below the cost of production."

Raglan Roast was started in Raglan in 1999 and opened in Abel Smith St in 2012.

Founder Tony Bruce disagreed that the price of coffee needed to be high.

"We have had $2.50 black and $3 white coffee pricing from the start of the business," he said.

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"It's important for building our brand and satisfying our loyal and passionate customers who always comment when they get charged $4.80 for a cup elsewhere and are disappointed with the product."

Bruce said Raglan Roast was able to keep the price down because of low overheads.

"All our locations are owned by us and, although we use the best coffee-making and grinding equipment available, we do no- frills fitouts and we don't use silver spoons - no saucer and serve in an opshop-style cup."

The company roasts speciality green coffee beans daily in Raglan and ships the final product to its stores around the country.

Bruce said keeping the price low was not without hardships.

"Green bean coffee pricing this year has risen to historical highs for a variety of reasons," he said.

"But that rise has come from all-time lows."

The latest pricing for bulk green beans was up 35 per cent and the retail per-kilo price of $36 was shrinking margins after costs of production, handling and freighting was removed, he said.

"But we still feel that our standard double shot is profitable for us and fair value for the customers.

"The green bean pricing should ease and or drop with fears of drought and bugs easing."

FROM GROWER TO CUP

Flight Coffee owns many businesses in the production of a cup of coffee. Helena - specialty coffee farm transformation project in Colombia. It's used as a resource for experimentation into design farming and production practices. Sells dry parchment coffee to Raw Material.

Raw Material - exportation project in Colombia. Joint project with Azahar Coffee. Exports green coffee to New Zealand and other importers around the world.

New Zealand Specialty Coffee Imports - imports containers of coffee from Raw Material and other exporters and sells to roasteries. All profits go towards getting coffee farmers out of the commodity market.

Flight Coffee roasting company - goal of providing the best roasted coffee, training, and support. Supplies the Flight Coffee Hangar and other cafes around the country.

The Flight Coffee Hangar - where all this work is manifested in cups.

- The Wellingtonian

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