You know, it's too unstable for us to predict or to see ahead or like it's just for me, just as you were saying, for me, we need to go as far as we can from that type of price on the New York stock. Like it's just too difficult to continue just hoping and asking God that this year we'll have a price over our cost of production. Like that's just not a way for us to continue doing business. And that's not a way for us to be, to think on our business in the long term.
Like that's not healthy. That's impossible. It's impossible. And so for me, the answer will always be having those open conversations about our costs, not only mine, but the exporters, all the logistic costs.
And on the other side, and at the end coming through to a price that it will help us all at least survive and have a small profit or a profit for all to live in a more dignified way. Dignified. Yes, that's the word. More dignified way.
If you're a roaster, you've probably felt it. It's getting harder and harder to find great quality coffee at volumes and prices that still make sense. One origin that's often been overlooked in the search is Honduras. For years, it's been treated as a conventional origin, even though there are producers quietly growing exceptional coffees that never make it into the specialty conversation.
The Honduran Coffee Alliance is a social enterprise with a simple mission. Connect those producers and buyers in a fair, sustainable and commercially viable way. They work with organized producer groups across regions like El Paraiso, La Paz or Lancho and Comayagua, helping them evaluate quality, tell their farm stories and move coffees that belong on specialty menus, not buried in anonymous blends. What that looks like for roasters is previously untapped lots that hit your flavor and quality targets, a minimum of just four bags to get started, transparency reports so everyone can see where every cent of the purchase goes and turning that first buy into a long term trade relationship, not just a one off.
If the idea of forming a long term relationship with producers in Honduras is of interest to you, reach out to the Honduran Coffee Alliance so that they can work to find you a fit for your 2026 menu. Samples are going to be ready soon. You'll find Sean Warner's WhatsApp and email in the show notes. Send him a message and tell him you heard about the Honduran Coffee Alliance here and start exploring what these overlooked Honduran coffees could do for your menu today.
Check the show notes for links. Welcome to the Daily Coffee Pro by Map of Mod Friends. I'm your host, Lee Safar, and this is episode three of an awesome five part series with Anna Doniz from Cafe Primitivo in Quindio, Colombia. We are talking about the reality of being a smallholder farmer in this coffee crisis and the volatility that's around the coffee crisis.
I sure, sure hope that there's nobody out there anymore that is still asking the question, are we really in a coffee crisis? If you are still asking that question, I don't know what else can be done. You must be working for the SCA. But anyway, boom, for anyone out there.
So in this episode, we're going to be talking about high prices. Now, Anna, the reason I specifically wanted to have a whole episode about high prices is because the C market is starting to shift downwards, right? And a lot of people are very worried about, does that mean it's going to continue to go down or is it going to continue to go up? So high prices is not just about the price being 440 and, you know, staying there.
High prices is about, is it going to continue to stay high or is it going to drop and then continue and come up? There's a whole bunch of things that are around high prices. Now, in episode one, you told us that the cost of doing business this past year has been so expensive. And on top of that, you had half the yields that you had to work with thereabouts, which made everything even more expensive.
When we look at high prices, I imagine you with the experience and education that you've got, high prices is not just about how much the C market is. I imagine things, there is more around that. Things like currency exchange, things about volatility in financial markets. So that's what we want to talk about in this episode.
And I want to start at currency. So what impact does currency exchange have on your business, even when prices are high? Go ahead. It has all of the impact.
Most of our contracts are signed in dollars, so it will affect us directly how the dollar is doing compared to our peso, right? Because all of our costs and everything we pay, the bills, how we pay the workers, how we pay everybody at the R team, everything is in pesos. And at the end, the currency and the exchange of it will affect us directly. That's something that we have to be in constant, like we need to look at it constantly on top of it.
So, for example, last year, what happened last year, like it wasn't only what happened worldwide, but political decisions also affect that exchange, right? And we never, like me, at least myself, I didn't predict all of these crazy things going on at the same time with politics. And this year has been exhausting, like just this year. It's like, what?
It's only been a month. I don't know how we're going to get to the end of this year. I thought 2025 was bad. This is like crazy on a whole other level.
Yes, this is a whole, like I feel like we're in a roller coaster going very fast and it's so hard to keep up with everything going on at the same time. And it just makes it very difficult, very, very difficult to keep up with that. Yeah. So the currency exchange is, one would think, well, usually when the U.S.
dollar goes down, the peso goes up. And so that works well for you. But what a lot of people don't realize is that you have to pay for a lot of inputs in U.S. dollars.
Like a lot of what you have to do when you have to travel, you have to pay in U.S. dollars. When you have to do a lot of your business, it's in U.S. dollars.
So if the U.S. dollar drops, that directly impacts your business, right? Yes. Like we need to think in both ways.
So when I'm traveling, when some of the things will go directly with the dollar price, of course. And it's just too much to be paying attention to. So, yes. And I was specifically thinking of like, let's say you want to do a trip to SCA Expo.
And now they're calling it World of Coffee, right? The currency exchange really hits you hard as, right? And you're using opportunity to go and meet customers and do all that kind of thing, right? Yes.
Going to any expo around the world. Like we can say World of Coffee, SCA, PRF. Like there's so many special events going on. And I always have this conversation with you, Lee.
Like I still go. Like I'm still doing my effort. And I'm constantly convincing her, you don't need to go. Yeah.
Because for me, that's the place where I can look for customers, meet people. And when you have this relationship, if you have a boyfriend, I'm going to come again with the relationship. It's important for you to see and to meet and to have a conversation and to have a cup of coffee. And those places, it's where we gather together.
But if we talk about the cost of traveling and being there, it's a very high cost. Because just one night in the US, if you change it into pesos, let's say $100, just one to three nights, it's almost a minimum wage in Colombia. Like it's a lot of money for a month. Yes.
It's a lot of money if you exchange just for what a hotel close to an exhibition center. Yes. If not, we need to stay far away or look for a hostel. That's what I normally do.
We'll look for a hostel that's kind of close or that we can walk there. But still, it's a very high cost for Colombians or for people in origin countries around the world, I'm sure. Like it's a lot of investment. But for me, it's a place where we gather.
And I'm very happy that now we're starting to see some events in Colombia, in Panama, at origin. I think that's at least something they are doing. Let's wait and see how many roasters around the world are going to invest and come to these events. We'll see if it's going to be worth it.
Well, and I think the world is changing. I think that it's becoming very obvious that these events are becoming all about, well, they have been for some time, but they're not for the part of the coffee industry that deals with what we're involved in. They're not for the trade part of it. I know it's a trade show, but what they really are is for the cafes.
What they really are is for the roasteries. They're not for the green coffee purchasing side of things. It's all, from what I can see, the majority of it is brown coffee and on, right? They pretend it's about green coffee, but who can afford the booths?
The only people that can really afford the booths are the big six, the bigger trading houses, which, anyway, this isn't an episode about trade shows. But the reason I raised all of that is because high prices get completely erased when you have to start doing your marketing, when you have to start looking for customers, when you have to start going to trade shows, when you have to start investing in the things that are away from farming. And high prices, the marketing, getting your customers, is such an expensive part of Coffee. That's the reason they're high is because nobody's got coffee.
Big check. And then you end up in a moment like we are in right now. So we're recording this on the 10th of February in 2026 and something very interesting is happening on the sea market right now. We don't have coffee.
There's still not a lot of coffee around and the price of the sea market is dropping. And this is why at the beginning of the episode I kind of talked about high prices being one thing and then they go down and then they go up again and then they go down. I want to talk about the fact that the things that are pushing the prices right now have nothing to do with coffee. They have nothing to do with if we have coffee or not because there's still no coffee around.
It's still very difficult to get coffee and you would expect that the price of coffee would still be above $4, but it's not. And this is again why it's important for us to differentiate between the corporate industry and the independent industry because the forces that are pushing the market down right now is all about hedge funds. It's all about what's going on in the debt market and in the financial markets. It's all about the fact that Japan, have you heard about the yen carry trade?
Do you know about this? No. This is very interesting. So for a long time, Japan was lending out money for zero interest, sometimes negative interest, for years.
So what would happen is hedge funds and investment banks all over the world would go and borrow money in the yen, convert it into US dollars and go and invest in stocks, in futures contracts, in Bitcoin, in property, and in commodities like coffee. Last month, no, no, no, not even that. Yeah, end of last month, end of January, there was a new Prime Minister in Japan that was appointed and she just got voted in by the people. Again, so there was a change in leadership.
The party had appointed her and she said, no, I want to know that the people are backing me. She called for an election. She decided to change the percentage rate from zero to four percent. When she changed that to four percent, all of those people started to get spooked, of course, because they had borrowed money at zero percent and they used that money to buy speculative assets like futures contracts.
The US dollar starts to go down and you end up having panic in financial institutions all over the world. What's happening right now in the coffee futures market on the sea market has a second order effect because over the last 12 months in 2025, investment banks and hedge funds started to see value in investing in the coffee futures markets. And what happened was they end up having to pull out because they have liquidation issues. They have margin calls.
When you borrow against something, so for people who don't know what a margin call is, if you borrow money and you use it to buy a speculative asset, when the value of that asset goes down, the person, the broker or the bank, whoever gave you that money, is gonna turn around and say, there's a margin between what you borrowed and what that asset is worth now. I'm gonna call in that difference and you have to pay it right now. Or you've got this many days to pay it. So if I borrow $100,000 worth of coffee contracts and then the value of them drops, but I've borrowed a hundred percent of the money to buy those contracts, this is a very general example, folks.
The difference between those two things, my broker is gonna turn around and say, you've got a huge exposure. The cost of that contract has gone down to $60,000. I need you to cover that 40,000 in your account so that I know that you're good for it. That has happened all over the world.
And as people sell out of their positions in coffee futures, what we end up with is the sea market dropping for nothing to do with fundamentals, which is what you're talking about. Fundamentals are what you're talking about, for those who don't know, supply and demand, the reality of it, right? What is happening? Do we have enough coffee?
Do we have too much coffee? That has nothing to do with the price right now. The coffee futures market is experiencing second order consequences of the yen carry trade and many other things, many, many other things that have nothing to do with coffee. Geopolitics, the cost of logistics, all of these things, Trump and Trump and Trump and Trump and Trump, like all of the things that he's doing is fucking batshit crazy and creating people to sell out of the US dollar and go into other currencies.
That has a second order effect in the coffee futures market. And who bears the consequence of that? The corporates can hedge against it. The smallholder farmer just has to stand there and take the lashing of those consequences.
Direct trade allows, or whatever the version of direct trade that you're doing, allows you to have relationships with people who understand what you're experiencing and you can unhook yourself from the sea market so that when prices are high or when prices are low, you guys are already figuring out what do you both need to run your businesses. Not just what should a bag of coffee cost. What do I need to run my business? And this, you know, you're building trust with each other.
But unfortunately, these high prices that we're experiencing over 2025 were connected to a lot of fundamentals. And then things that had nothing to do with fundamentals are pushing them down again. Now we don't know what's going to happen next, right? As we speak, the price over the last two trading days had gone below $3.
And there are a lot of farmers that were very spooked about that. A lot of exporters and importers that are very nervous about that. Because what that signals is a lot of volatility ahead. Yesterday, the price touched above $3 again.
I don't know where it's at today. But as a coffee farmer, Anna, when you see these prices doing these things, what does it make you think and feel about this? You know, it's too unstable for us to predict or to see ahead or like it's just for me, just as you were saying, for me, we need to go as far as we can from that type of price on the New York stock. Like it's too difficult to continue just hoping and asking God that this year is going to be at least on the price of this year, we will have a price over cost of production.
That's just not a way for us to continue doing business. And that's not a way for us to be, to think on our business in the long term. Like that's not healthy. That's impossible.
It's impossible. Yeah. And so for me, the answer will always be having those open, open conversations about our cost, not only mine, but the exporters, all the logistic costs and on the other side, and at the end coming to a price that it will help us all at least survive and have a small profit or as a profit for all to live in a more. Dignified way.
Dignified. Yes, that's a word. More dignified way. Like it's unsustainable for us to keep on hoping and to keep on selling our coffee just as the New York stock tells us to sell our coffee.
It's impossible. One last question that I have for you in this episode. We have been saying high prices. For those who are just listening, we're using like air quotes to say high prices, right?
Are they high? No, not at all. Like understanding all the rest of the people, the activity that we have talked about at the end. This is just covering costs.
Like it's not high at all. And that's why it's important to have this conversation. Thank you, Leaver, for giving us a voice as producers and to tell all the industry, Hey, these are not high prices. We need to make the world hear us there because if we don't work together as an industry and understand our reality, not only producers, but everyone's reality at the end.
If we don't have these conversations here, like, thank you for giving us this space because it's giving us the opportunity to, to open our eyes and to have a bigger vision of what's going on everywhere in the world. And at the end, these aren't high prices at all. It's barely covering our cost of production. And now that we're experiencing a low, how do you call it?
A downward slope. Yep. Downward slope. I'm very worried, not only for producers, but for the global coffee supply.
I don't know if we're going to have supply in the midterm or longer term. I'm sure that we will have another decrease in the price as we had a few years ago. We're going to see a lot of great players on this side of the world do other stuff. Yes.
That leads us perfectly into what we're going to talk about next, which is how do we move forward together as value chain partners long-term? Because this is not a problem that is up to producers to solve. And it's not a problem that's up to importers, exporters, or roasters to solve. It's a problem for all of us to solve.
So join us for the fourth episode of this series, folks. Peace, love, and peanut butter. Have an amazing rest of your day. If you enjoyed this episode, consider supporting MAPA Forward, our guests, and advertisers on social media.
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