TC_Nov2015_Pg_20-25

• The Delicacy of White Teas• Special Report: Honduras Part II

• Growing Private Label Opportunities• Special Report: Sri Lanka Part III

NOVEMBER 2015www.teaandcoffee.net

The International & Trusted Voice of The Tea & Coffee Industries Since 1901

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PAIDPERMIT 182MIDLAND MI

Bringing the Coffeehouse

into the Office

6 Editor’s Letter

8 New & Notable

14 Sustaining the Chain

16 Facts, Figures & Findings

18 Calendar of Events

44 Company News

46 People News

48 Advertisers Index/Marketplace

50 Straight from the Cup:Josemaria Ruiz Gonzalez

departments

ContentsNovember 2015 Vol. 187/No. 10 20 Bringing the Coffeehouse

into the Office By Zachery Bridgeman

28 Covering the Earth with Single Serve By Donald N. Schoenholt

32 Growing Opportunities in Private Label Coffee By Maja Wallengren

34 Special Report: Honduras Part II By Maja Wallengren

38 White Teas: Rare, Premium Treasures By Barbara Dufrêne

42 Special Report: Sri Lanka Part III By David DeCandia

features

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COVER STORY

Editor-in-Chief Vanessa L. Facenda

Specialties Editor Donald N. Schoenholt

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Contributing Editor Aaron Kiel

Contributing Writers Timothy J. Castle Barbara Dufrêne Emily McIntyre Rachel Northrop Maja Wallengren

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Editorial Advisory Board Lon LaFlamme & Phil Beattie, Dillanos Coffee Roasters; Michael Cramer, Adagio Teas; Daniel Ephraim, Modern Process Equipment; Stephen Hurst, Mercanta; Stephen Schulman, S&D Coffee; Melissa J. Pugash, U.S. Tea Council/ Specialty Tea Institute; Christian Wolthers, Wolthers America

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from the

Editor’sDeskThe Need for Gender EquityWhile in college I wrote a paper entitled Pretty Women, which lamented the lack of formidable, independent women in fairy tales, television shows and movies. This was long before there was Merida (Brave), Olivia Pope (Scandal), Katniss Everdeen (The Hunger Games) or even Ugly Betty (which had versions in many countries). In fairy tales, the women always needed rescuing by a prince in order to be happy or fulfilled. In Hollywood, brilliant, accomplished women were accompanied by requisite neuroses or “iciness.” In the corporate world and in politics, the glass ceiling was cracking, but still few women sat in corner offices or held leadership positions. Flash forward to 2015, and the world–Hollywood, corporate and political–has changed, to an extent. There have been multiple female Prime Ministers elected around the world, the U.S. has had three female Secretary of States, we’re seeing more women in high ranking executive positions in the corporate world, even the youngest-ever Nobel Prize laureate was a women, actually, a girl, Malala Yousafzai. And yet we’re still striving for gender equity—and not just in developing nations. A recent report from PayScale Inc., Seattle, Wash., found that in the U.S., women are paid less for equal work than men, with gender inequality occurring in virtually every industry and at every level. The report further revealed that the widest discrepancy in wages is between married men and women with children. Globally speaking, women make up 50 percent of the population and work 67 percent of the working hours. They earn 10 percent of the world’s income, own one percent of the world’s property and are 70 percent of the world’s poor (per the UN Statistics Division, Dec 2012 and the UN Development Fund for Women). In coffee (and likely in tea as well), while there are variations by region, women generally contribute a majority of the labor in the early stages, while men capture and control income. Women are under-represented in leadership positions and are under-valued for their efforts. They lack remuneration, control over income, assets and decision-making at the household level, and do not have access to training and resources critical to their roles. It is for reasons such as these that organizations like the International Women’s Coffee Alliance (www.womenincoffee.org) and Coffee Quality Institute’s newly created Partnership for Gender Equity (www.cqi.org) exist and are working to motivate change. “...This conversation is gaining momentum and will continue as long as it takes to see the kind of change we need in order to ensure an equitable landscape for women in coffee,” said Kim Ionescu, the SCAA’s director of sustainability at the recent IWCA Conference. (See story page 10.) Paraphrasing PGE’s philosophy, effecting change is a matter of true sustainability. Through gender equity, there will be more reliable supply, better coffee–and tea–and more resilient communities.

Vanessa L. FacendaEditor-in-Chief

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tea & coffee reports brewing worldwideNew&Notable


The Inaugural New York Coffee Festival Kicks Off Coffee WeekThe first New York Coffee Festival, held at the 69th Regiment Armory in New York City September 25-27th, kicked off Coffee Week in NYC, cel-ebrating the growing specialty coffee scene in the Big Apple. The three-day event hosted more than 6,000 visitors and 85 exhibitors, including Starbucks Reserve, La Colombe and local coffee roasters Nobletree, Joe’s Coffee, Toby’s Estate, Irving Farm and Sweetleaf. Exhibitors on the equipment side included Sanremo, Pentair, Espresso Parts and La Marzocco. The NYC event is the first U.S.-based festival for London, U.K.-based organizer Allegra Events, which also operates the London Coffee Festival. Visitors enjoyed free coffee tastings, interactive workshops, demon-strations from world-class baristas, coffee-cocktails, live music, art and the “Coffee Masters” competition, the latter of which showcased baristas in the categories of cupping, brewing, latte art, the order challenge, the signature drink and the espresso blend. Attendees were also able to learn about the various ways to make and brew coffee at home, visit their favorite barista at the True Artisan Café and browse the street food market. The event’s Lab program proved popular with in-depth talks from several industry leaders, including Nick Tolley from Taylor St. Baristas, who began the first day by speaking on the scalability of specialty coffee. Speakers from Toby’s Estate followed, as well as those from Sustainable Harvest, Royal Coffee New York, Pacific Foods and Sanremo. The New York Coffee Festival is also the official launch event for the char-itable Coffee Week NYC, which promotes the vibrancy of the coffee industry while raising money for clean water and sanitation projects in coffee-produc-ing communities. Fifty percent of all ticket sales were being donated to Project Waterfall, with all funds directly entrusted to NYC-based “charity: water” to support their life-changing water projects in coffee growing regions.

The first New York Coffee Festival took place in NYC in September. Along with Nobletree, other local roasters exhibiting included Joe’s Coffee, Toby’s Estate and Irving Farm.


In total, the festival raised more than USD $40,000 for Project Waterfall, including a total of USD $7,390 from the Espresso Martini Bar in conjunction with Grace Hightower & Coffees of Rwanda and 6100 Vodka.—Zachery Bridgeman

IWCA Convention Draws Over 400 Attendees from 30 CountriesMore than 13,000 coffee profession-als from around the world gathered in Bogotá, Colombia, October 15-18th for Expo Especiales Café de Colombia. The trade show was also host to a num-ber of coffee events, including the 10th Colombian Barista Championship and the 5th National Coffee Cup Tasters Championship, as well as the 4th International Women in Coffee Alliance (IWCA) Convention. During the opening ceremonies for the event, Roberto Vélez Vallejo, the newly

elected CEO of the Colombian Coffee Growers Federation (FNC), was greeted with cheers when he said, “Welcome to all the women coffee producers!” Mery Santos, the president of IWCA, also spoke during the opening ceremonies, setting the tone for the next few days of learning and collaboration on critical issues for the coffee industry. Jennifer Gallegos of Fair Trade USA, acted as lead organizer for the IWCA Convention. Mansi Chokshi of SCAA, a fellow IWCA board member, commented, “As a volunteer, Jennifer worked tirelessly to see this event through. She went above and beyond, which resulted in a hugely successful show with fantastic speakers and equally impressive attendees from around the world.” The IWCA board of directors and chapter representatives all came to be a part of this bi-annual gathering. The IWCA Convention was held during the first two days of Expo Especiales. Speakers from all over the globe presented and participated the panel dis-cussions. They explored topics ranging from market trends to sustainability, but there was a

clear spotlight on gender equity in the coffee value chain. Over 400 attendees from 30 countries were in attendance. This event brought to light some key research that has been done in the realm of gender equity. “Although this is the fourth iteration of the IWCA Convention, there was a distinct sense that this conversation is gaining momentum and will continue for as long as it takes to see the kind of change we need in order to ensure a more equitable landscape for women in coffee,” noted Kim Elena Ionescu, SCAA’s direc-tor of sustainability. The IWCA was held in conjunction with Expo Especiales for the first time this year, and although the conference will be held in a different country next time, Chokshi said, “We are so grateful to the FNC and Expo Especiales for their hospitality and for graciously hosting our Convention this year. We hope to contin-ue collaborating with the coffee growers of Colombia and working towards solutions for our industry.”—Lily Kubota, content & communications manager, SCAA

Hill Bros. Coffee Debuts Packaging Redesign & New TaglineHills Bros. Coffee is paying homage to its San Francisco heritage with its pack-aging redesign that launches this fall. The refreshed design returns to the signature red that earned Hills Bros. the nickname “The Red Can Brand” from the 1930s to the 1960s. The new packaging also fea-tures illustrations of Bay Area icons and landmarks as well as a new tagline, “A Taste of San Francisco.” Now owned by Portsmouth, Va.-based Massimo Zanetti Beverage USA, the Hills Bros. brand dates back to 1878, with a small storefront within the Bay City Market, and eventually grew to become a national brand. Sarah Cunningham, senior brand manager of

New&Notable

Starbucks Coffee highlighted its Reserve Coffees at the NY Coffee Festival while La Colombe (Left) showcased its cold brew latte draft.


New&Notable

Hills Bros. Coffee, noted that the new font for the logo links back to the rooftop signage on the Harrison Street factory that once packaged millions of pounds of Hills Bros. coffee—and which remains a recog-nizable landmark of the San Francisco skyline. She added that the new packaging features an additional tagline, ‘Crafted without compromise for over 137 years,’ which highlights “both Hills Bros.’ lon-gevity and commitment to quality.” The Hills Bros. packaging was last redesigned in 2006 when the brand’s ownership transitioned from Sara Lee Coffee & Tea to MZB USA. The recent updating was motivated by several factors. “All brands need refreshing on a regular basis,” said Cunningham, “but we iden-tified some challenges with consumer attitudes about the brand and with the new shelf dynamics in the coffee section that drove the change.” She said that the package felt a little dated relative to key competitors that have undergone three to four label chang-es in the nine years since Hills Bros. last

redesign. Additionally, some consumers found the blend and roast level informa-tion hard to read and that the iconogra-phy had lost its relevance. Furthermore, “the space allocations within the coffee aisle have changed with the proliferation of single serve coffee, so it was important to change the ombre effect of our past

design to be something that would stand out on the shelf,” said Cunningham, add-ing that the red color is a tribute to the vibrant red cans that Hills Bros. began using at the end of the 1800s. “But the color-blocking effects of the design and the nuanced illustrations take advantage of the state-of-the-art printing technol-ogy that’s available across all packaging

types—cartons, flexo labels and bag film.” According to Cunningham, Hills Bros. coffees use the most eco-friendly and sustainable packaging available. “Our single serve filter cups use 30 percent less plastic than the regular plastic cups. All of the cans are made with recycled steel and are infinitely recyclable.” Under MZB USA’s ownership, Hills Bros. has returned to its roots, focusing on West and Midwest markets. (MZB decid-ed to strengthen each of the brands it owns in the markets where each was strongest. Sister brand Chock Full o’Nuts is now the East Coast brand.) Cunningham noted that while Hill Bros.’ product assortment spans many household types and income demographics, the brand’s target consum-ers are Midwestern women, ages 40-plus. Prices for the canned coffee selec-tion range from USD $3.99 to $11.99 depending on the size and blend; USD $9.99 to $14.99 for the two-pound whole bean coffees; and USD $5.99 to $7.99 for 12-count, single serve cartons.—Vanessa L. Facenda

An Improved Understanding of the Impacts of Climate ChangeNew research on coffee and climate change will allow dramatic improvements in climate adaptation efforts for coffee growers and the coffee industry.

Cultivation of Coffea arabica has been shown to be highly sensitive to and neg-atively impacted by progressive climatic changes. Arabica coffee requires a climate with annual mean temperatures of about 20°C and over 1200 mm annual rainfall to be economically viable. Temperatures above 30°C for extended periods reduce yields, while frost for a few days dam-ages or even kills the plant. A short dry period of less than 40mm precipitation per month increases yield and promotes uniform flowering, but more than three dry months reduces yield. A new study published October 27th in the journal PLOS One confirms predictions that half of the land currently suitable for Arabica coffee production will no longer be suitable by 2050. But it also identifies the key climate zones in which coffee flourishes and shows how these zones will change by 2050, which brings new insights about what can be done to adapt. Coffee is currently grown in many dif-ferent climate zones in the equatorial belt, but previous studies of coffee and climate change only distinguished between areas

that are or will be “suitable” or “unsuit-able” for coffee growing. This limited their practical usefulness for adapting coffee to climate change. Applying agro-ecological zoning, which is a common tool used to identify homologous environments and prioritize research, this study “unlocks the black box of suitability” and shows how the different climate zones are expected to fare over the next 35 years.

In the study, researchers demonstrate a pragmatic approach to describe spatial changes in agro-climatic zones suitable for coffee under current and future cli-mates, and to define agro-ecological zones suitable to produce Arabica coffee by clustering geo-referenced coffee occur-

rence locations based on bio-climatic variables. They also used random forest classification of climate data layers to model the spatial distribution of these agro-ecological zones. The zones were used to identify spatially explicit impact scenarios and to choose locations for the long-term evaluation of adaptation mea-sures as climate changes. This is the first time that researchers have mapped coffee’s current and future climate zones globally.

Impact on Affected AreasNot all coffee climates will be affect-ed equally by climate change. Areas around the equator with seasonally constant temperatures, including many parts of Colombia, Ethiopia, Kenya and Indonesia, will be least affected by climate change. Approximately 60 percent of areas with this climate will be unchanged in 2050—good news for the specialty coffee industry, which relies on these regions for its highest quality coffees. The highest losses will be in hot, dry regions such as the northern Minas Gerais state in Brazil, parts of India, and Nicaragua—areas that currently give some of the highest yields of Arabica coffee. Nearly 80 percent of the land in this climate zone will become unsuitable for coffee by 2050. Cool but dry cli-mates, such as those in western São Paulo state in Brazil, will also see substantial losses. Meanwhile, substantial areas that currently have cooler or wetter climates will become hot and dry by 2050. It is clear from these findings that Arabica coffee plants will have to become better adapted to heat and drought stress, and coffee growers will need to tailor their practices toward hot and dry conditions. “Overall, the Arabica market is extremely threatened,” said Christian Bunn, the study’s lead author, a research-er for the Colombia-based International Center for Tropical Agriculture (CIAT). “There is rising demand. In the future, we’d need more area to grow coffee on,

sustaining the chain

World Coffee Research is evaluating the perfor-mance of 35 coffee varieties in 19 countries.

The study predicts that nearly all of the coffee lands in Brazil’s hot-dry areas will become unsuitable for coffee production by 2050.


November 2015 15

but we’re going to have less. I believe high locations in East Africa, Colombia, Ecuador and possibly Indonesia might become more suitable. But they will have to be very productive to meet the demand because Brazil, the current powerhouse, is going to see big losses.” The study also provides more detail on how climate change will impact the elevations at which coffee can grow well. By 2050, the median elevation of land suitable for Arabica coffee will be more than 300m higher, but in hot, wet zones such as Southern Mexico, coffee will need to migrate nearly 500m higher. An estimated 25 million farmers pro-duce coffee on over one million hectares, most of whom are small holders who depend on coffee for their livelihoods. Coffee growers will need to adapt their agronomic practices to remain compet-itive as the climates in their areas shift from one type to another. Adaptation will be difficult for small holders as cof-fee “climbs up the mountain” or cli-mates shift to become hotter and drier.

Climate Adaptation PlanningBy mapping current and future climate zones, the study’s findings will allow for more skillful and targeted climate adapta-tion planning. “This research gives, for the first time, spatially-explicit insights about what type of adaptation is needed. Hot-dry climates will need to adapt differently than hot-wet ones. Previous work only indicated if coffee would become more or less suitable. This information will help to

guide the adaption process,” said Dr. Peter Läderach, co-author of the report and senior climate change specialist for CIAT. “Climate change for coffee is extreme-ly serious,” said Bunn. “It’s a perenni-al crop, which means what you plant today will be in the ground still in 2050; it will get the full impact of climate change.” Focusing on adapting the cof-fee plant itself is one of the strategies that researchers are using to plan for a future in which coffee is threatened. “We can use the genetics of coffee to buy more time,” said Tim Schilling, co-author of the report and executive director of World Coffee Research, a non-profit research and development pro-gram that studies coffee. “The informa-tion in this report will be invaluable as we work to create new, climate-resilient vari-eties tailored to individual climatic zones.” World Coffee Research, based in College Station, Texas, commissioned the study and is using the findings to locate sites for the International Multi-Location Variety Trial, a comparative study of how 35 coffee varieties perform across the world in different climate zones. The data will be used to guide WCR’s global coffee -breeding program, which is working to

adapt the coffee plant so that it produc-es high quality coffee with good yields under a climate-constrained environment. Key findings of the study include:

• Confirmation of predictions of 50 per-cent reduction in land area suitable for Arabica coffee production by 2050;

• Dramatic expansion of the under-standing of what it means for land to be “suitable” for coffee production now and in the future;

• A detailed picture of which types of coffee climates will be most affected by 2050, with significant losses pre-dicted for Brazil, the world’s largest coffee producer.

The study was undertaken as part of the CGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS). The full study is available at PLOS One <http://dx.plos.org/10.1371/journal.pone.0140490>.

The report was authored by Christian Bunn, Peter Läderach, Juan Guillermo Pérez Jimenez, Christophe Montagnon and Timothy Schilling. [Report synopsis edited by Vanessa L. Facenda]

Coffee breeders at World Coffee Research are working to develop varieties that will be resilient in the face of climate change.

Areas with relatively constant temperatures, such as much of the coffee land in Kenya, are predicted to remain effective for coffee growing in the coming decades.


The diagrams below provide a picture of coffee and tea consumption by global region. The chart on the left shows the brewed volume shares by region in 2013, with North America and Latin America dominating coffee shares, while the Middle East and Africa and Asia Pacific lead in tea. The chart on the right shows the growth by category of the value of hot drinks in USD from 2013 to 2018, with total value at USD $13.3 billion. Coffee has a growth projection of 61 percent, tea of 28 percent and other hot drinks of 11 percent.

facts, figures & findings

Total valueUSD 13.3bn

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%Middle

East and Africa

Asia Pacific

Eastern Europe

Australasia WesternEurope

NorthAmerica

LatinAmerica

Hot Drinks Value Growth by Category (2013-2018)Brewed Volume Shares by Region, 2013

Coffee Tea Other Hot Drinks

Source: Euromonitor International, 2015

11%

61%

Coffee Growth Projected to Increase 61 Percent, Tea Up 28 Percent

28%


calendar of events

November 3 – 6Andina-PackBogotá, ColombiaWeb: www.andinapack.com

November 11 – 13International Coffee & Tea FestivalDubai, United Arab EmiratesWeb: www.coffeeteafest.com

November 12 – 15SintercaféPlaya Herradura, Costa RicaMarriott Los Sueños ResortWeb: www.sintercafe.com

November 15 – 17PLMA ShowChicago, Ill.Rosemont Convention CenterWeb: www.plma.com

November 23 – 25European Coffee SymposiumCopenhagen, DenmarkThe Bella Sky HotelWeb: www.europeancoffeesymposium.com

December 1Tea Assoc. of the USA Holiday PartyNew York, N.Y.The Lotus ClubWeb: www.teausa.org

December 4PCCA Annual Holiday PartyEmeryville, Calif.Trader Vic’sWeb: www.paccoffee.com

December 4GCA Annual Holiday PartyNew York, N.Y.The Downtown AssociationWeb: www.greencoffeeassociation.org

2016January 15 – 17India Tea & Coffee ExpoMilan Mela Exhibition Center, Kolkata, IndiaWeb: www.teacoffeeexpo.in

February 3 – 5African Fine Coffees Association ConferenceZanzibar, TanzaniaWeb: www.eafca.org/wwc/conference

February 12 – 16AmbienteFrankfurt, GermanyWeb: www.ambiente.messefrankfurt.com

February 21 – 25GulfoodDubai, United Arab EmiratesWeb: www.gulfood.com

February 24 – 262nd Coffee Rust SummitGuatemala City, GuatemalaWeb: www.anacafe.org and/or www.promecafe.org

March 6 – 84th World Coffee ConferenceAddis Ababa, EthiopiaWeb: www.ico.org

March 9 – 11116th Session of the International Coffee CouncilAddis Ababa, EthiopiaWeb: www.ico.org

March 11 – 13Coffee Fest New YorkNew York, N.Y.Javits CenterWeb: www.coffeefest.com

March 17 – 19NCA Annual ConventionCoronado, Calif.Web: www.ncausa.org

April 5 – 76th Global Dubai Tea ForumDubai, United Arab EmiratesWeb: www.dmcc.ae

April 13 – 15NAMA One ShowChicago, Ill.McCormick PlaceWeb: www.namaoneshow.org

April 14 – 17SCAA, The EventAtlanta, Ga.Web: www.scaaevent.org

May 10 – 12Tea & Coffee World CupKrakow, PolandEmail: [email protected]

June 15 – 17World Tea ExpoLas Vegas, Nev.Web: www.worldteaexpo.com

June 23 – 25SCAE World of Coffee Dublin, IrelandWeb: www.scae.com

office coffee systems


Bringing the Coffeehouse into

the Office

Though it may be ever more dif-ficult to provide employees’ favorite café flavors and formats,

employers have much to gain by upscaling their office coffee systems. In a recent pub-lication titled, “Addressing the Starbucks Effect: Leveraging Beverage Service to Boost Employee Morale and Productivity,” Aramark Corporation, headquartered in Philadelphia, Penn., using research by Wirthlin Worldwide, based in Reston, Va., and Harris Interactive, headquartered in Rochester, N.Y., revealed that employ-ees spend 14 minutes outside the office on average during coffee trips. With an average employee annual salary of USD $40,000, a company with 50 workers loses 102 workdays a year and USD $15,625, while a company with 1,000 workers loses 2,031 work days and USD $312,500. Additionally, research by Packaged Facts, based in Rockville, Md., found that assum-ing an employee works 250 days a year on a USD $25 hourly wage, the employer would save 62.5 hours and USD $1,563 a year by the employee taking significantly smaller five minute, on-site breaks than 20-minute, off-site ones. But saved time and money are not the only benefits of providing quality office coffee systems. As Dan Ragan, national sales manager at Pod Pack International, based in Baton Rouge, La., pointed out that employees are hired, particularly those who are earning salaries of USD $80,000 and up, for their unique skills and ideas. Allowing them to take swaths of time out of the day in which their abilities are not fully utilized detracts from their net worth and conveys a less than optimal message about how much the employee is valued by his or her employer. Plus, an employer cannot easily monitor what the employee is doing while out for coffee, nor guaran-

tee that he or she will not be injured or involved in an accident while in commute. In a Packaged Facts November 2014 National Online Consumer Survey about in-office beverage consumption, 64 percent of participants said they drank ground/whole bean coffee made at work or at home, 46 percent they drink coffee pods/K-Cups, 34 percent said they brought cof-fee from a restaurant, coffee shop or donut shop, 30 percent said they drank instant coffee, 17 percent they brought coffee from home, 17 percent they drank vending-ma-chine style coffee and 16 percent said they used a self-serve kiosk. Within this breakdown, company size often plays a part in determining the systems and machinery that office buyers choose to provide for employees. Above all, convenience is key. Easy access to water coolers and water bottles remains extremely important to employees. After convenience, Ragan ranks quality of the coffee and the office coffee system as being the second most important element of the OCS, followed by cost and environmental impact. He explained that pods are con-venient for offices because they cost USD $0.15 less than K-Cups, provide 1.19 percent yield per 8-oz serving, while being compostable and producing 90 percent less waste than K-Cups. Ragan added that the quality differs as well, since pods brew at least 200 degrees Fahrenheit, use a great degree of pressure for a higher extraction rate and yield. “Pod Pack uses nitrogen generators to make the packing machine a nitrogen environment, thereby reducing the oxy-gen level to nearly zero at the point of packaging, along with a nitrogen flush in the package. The packing line provides finished and sealed projects from whole bean in three minutes.”

Variety Means ConvenienceOne aspect of convenience that must not be left out is variety, which has largely been driven by workplace demographics, explained Lara Aman Mattey, associate vice president of Aramark’s Refreshment Services group based in Philadelphia, Pa. “Today’s workforce is swiftly changing. In 2015 more than one in three work-ers are Millennials, and this year they surpassed Generation X to become the largest share of the American Workforce (Pew Research Center Analysis and U.S. Census Bureau data). Add in the Baby Boomer generation and it’s obvious that variety is extremely important to satisfy each generation’s differing expectations. But the need for variety goes further than generational differences. You also see the increasing importance of variety among differing ethnic groups, regions and industries,” said Mattey. “Aramark has a broad product and equipment catalogue to indulge the diverse tastes. We have regional product planograms that offer the flexibility to include local flavors along with popular national brands,” she said. “These plano-grams help adapt a customer’s program to include a diverse workforce and con-nect employees to the coffee program. Whether that includes Cuban coffee in southern Florida or espresso machines in Silicon Valley, we feel variety is key.” While variety and overall convenience is crucial to the every day employee, it can also be a hindrance to choosing the best coffee system for an office if its buyer wants to purchase the seemingly easiest solutions and machinery without considering the wants or best interests of employees. “The OCS operator would like to encourage the buyer to arrange a tasting because up to 80 percent of office

November 2015 21

It’s not news that employees are happier and more productive in an office with a coffee system, or that employers save on time and money in the long run. Coffee is a workplace staple, and it will be there whether the office provides it or not. Of course, gone are the days when drip coffee suffices, as offices are continuing to provide single serve and vended coffee to bring the variety and ambiance of a café into the break room. By Zachery Bridgeman

COVER STORY

coffee buyers do not drink coffee. This method allows the cumulative office to accept a product based on quality rather than price, thereby providing a higher margin to the operator” said Ragan. Perhaps growing at a faster rate than pods and K-Cups is the bean-to-cup segment, particularly among larger com-panies. Harrison Fairstein, president of Competition Coffee, an office coffee ser-vice based in Toronto, Canada, explained that 15 percent of his clients use a brew basket or batch brew method, about 35 percent use K-Cups, capsules and pods and 50 percent of his clients use bean-to-cup brewers. Since most of his clients are giants within the social media, bio-technology and manufacturing industries, bean-to-cup makes sense because it pro-vides fresh, high quality coffee on a large scale, but does so more economically than K-Cups, and, even though it requires more frequent servicing and cleaning, which is almost always done in situ by an employee of the coffee operator, the only waste produced is the coffee grounds themselves, leaving hardly any environ-mental footprint. All this, in roughly the same amount of time it takes K-Cups and other capsules machines to make that great first, second or third cup of coffee. (The Packaged Facts November 2014

National Online Consumer Survey stated that 10 percent of employees reported drinking four cups of coffee a day at work, while 29 percent reported drinking two.) It may come as a surprise that along with bean-to-cup, many OCS operators are seeing a throwback to traditional brewing methods, and single-serve growth has somewhat slowed. “Single-cup is still popular in many offices, but does not nearly have the explosive growth we’ve seen from it in past years,” said Joe

Simonovich, senior vice president of operations at Corporate Essentials, an office coffee and supplies company based in Parsippany, N.J. “Whole bean-to-cup brewing has been gaining popularity over the past four years, but we have really seen a return to traditional drip brewing in many cases, with clients gravitating towards equipment similar or identical to what they see in their favorite cup.” Doug Shindler, president of U.S. Coffee, Inc., based in Hicksville, N.Y., also stated that more clients are desiring third wave locally-roasted coffee. “Portion packs and single cup are still the most popular segments, with bean-to-cup becoming more popular because operators are not tied into a proprietary system, plus the machines are more advanced. In larger offices, higher volume batch brewers with locally roasted coffee are gaining traction.” Mike Flanagan, president of Canteen, an OCS based in Charlotte, N.C., echoed these observations. “Our bean-to-cup category has shown the most growth over the past two years. The option of coffee roasts and drinks appeals to the consumer. Single-pack growth (Keurig/Flavia), while remaining strong as a per-cent in our portfolio, has stagnated. The variety and options highlighted by bean-to-cup seem to be more attractive to the sophisticated consumer, and the overall economics of the bean-to-cup systems,



The Melitta Cafina CT8 automatic coffee system (Above) with a touchscreen and the Bunn Crescendo, brewer (Right) were two solutions for HoReCa and OCS showcased at Host Milan 2015.

COVER STORY

Source: Packaged Facts, Rockville, Md., based on data from Automatic Merchandiser’s, “State of the Coffee Service Industry Report,” September 2014. All figures are for the 12 months ending July 2015. (2015 and 2016 figures are Packaged Facts estimates.)

Office coffee service revenue grew 4.5 percent from 2014 to 2015. It is expected to continue at the same rate into 2016.

while more complicated and expensive to maintain, allow for healthier and control-lable operating margins not found in the proprietary pack brewers.” What types of coffee are consumers drinking most? According to a Packaged Facts study titled, “Office Coffee Service Revenue: Dollar Share by Coffee Type, 2014,” based on data sourced from the National Automatic Merchandiser Association’s September 2014 “State of the Coffee Service Industry Report,” the coffee revenue breakdown includes: national brand coffee at 27 percent, pri-vate label coffee at 27 percent, local coffee brands at 16 percent, K-Cups at 10 percent, other single-cup at 8 percent, value frac packs at 4 percent and espresso/cappuccino at 2 percent. Added Simonovich, “People want to know more than just whether their coffee is Fair Trade or Rainforest Alliance certi-fied, they want to know where their cof-fee was roasted, where it was grown and even who the farmer is. Third wave and locally-roasted coffees have been the areas that we have seen the most significant growth over the past few years. Keurig-compatible solutions including Mother Parker’s RealCup brand capsules lead another category in which we have seen huge growth over the past six months.” Mattey echoed this sentiment, noting that Aramark is currently entrenched in the third wave coffee movement, or spe-cialty coffee based on origin and artisanal methods of production. Jeff Parker, direc-tor of Branded Solutions Office Coffee at Starbucks Coffee, Seattle, Wash., also noticed this progression. “Another trend in the OCS industry is an increased inter-est in premium coffee,” he said, “because consumers today are more coffee savvy, are interested and engaged in coffee, and want to know more about the coffee in their cups—from the origin to roast, to the flavor profile.” Sustainability is a priority for many OCS consumers. “Responsible sustain-ability programs are becoming a require-ment for operators. And ‘green-washing’ is completely unacceptable, as this gen-eration is informed and will hold you accountable,” said Howard Chapman,

the recently appointed chairman of the National Automatic Merchandising Association (NAMA), based in Chicago, Ill., and coffee service division man-ager for Royal Cup Coffee, based in Birmingham, Ala. “Our efforts at Royal Cup have resulted in an annual sustain-ability report and scorecard, which is published on our website.” Overall, companies realize that quality office coffee systems increase their value in the eyes of employees. Said Parker, “We find that companies are looking for ways to retain their talent, and offering a premium coffee experience is one of the amenities in which employers are interested.”

Challenges BrewingOf course, while providing a custom-ized variety of offerings bolsters employee morale, it is also part of the challenge of maintaining an up-to-date office coffee service. Consumers want the latest and greatest products that they see outside the workplace, plus not everyone drinks only coffee all the time. “Simple coffee and beverage offerings are no longer a big attraction. A full array of services, catering, fruits, seasonal offerings, micro-markets and food have all become integral parts of our services and capabilities,” said Flanagan. Tea, too, with its always-increasing varieties and pro-posed health benefits, complements coffee in an office, and since many office coffee machines provide a hot water option, it is easy and affordable enough to provide. Nows some employees seek tea in single

serve K-Cup and capsule forms as well. But the biggest challenge to OCS, according to Shindler, is the Internet. “People can search and shop for any-thing and there’s always someone will-ing to ship it to them. What separates an OCS company from an Internet retailer (or a supermarket or wholesale store for that matter) is that we supply and ser-vice the equipment.” Office supply companies pose a rela-tively new threat to office coffee operators, since many now offer coffee and K-Cup machines along with the full range of office supplies that workplaces constantly need. OCS companies like Corporate Essentials compete by having a full-service option that includes break room and jan-itorial supplies, while others have begun providing office supplies along with bev-erages, like U.S. Coffee, which started a steadily growing office supplies division five years ago. Others, like Fairstein of Competition Coffee, take a different tact by avoiding office supplies in their OCS offerings to maintain a certain company image. “Office product supply companies provide a ‘drop and go’ service to clients. They do not provide equipment support/maintenance or problem solving while on site. Coffee and tea in the workplace is such a significant component to improv-ing morale, work efficiency and corporate stability. It demands professional support from the office provider. Only OCS-focused companies strive to provide this level of support.” Café in a BoxEfforts to experiment with and improve the OCS market never ceases. “The OCS market will bring more sophistication, certainly, driven by more knowledge and growing awareness about what is good and what isn’t, as well as curiosity to experiment with new products which, if it does make competition stronger, it also opens up new opportunities,” said Ennio Ranaboldo, CEO, Lavazza USA, based in New York, N.Y. “Espresso bean-based drinks are still relatively a niche but we believe will grow significantly bigger in the years to come. As far as Lavazza is concerned, there will be innovation coming into the market in the

The Nuova Simonelli Talento coffee machine was presented at Host Milan as an OCS solution, complete with cup-warming shelves and a refridgerator for milk and/or cream.



November 2015 25

next couple of years. Its driving factors will be the expansion of beverage choice, more versatile and user-friendly systems and a much broader selection of great coffees.” “Recent advancement in technolo-gy has transformed our industry,” said Fairstein. “Software tracks consumption, monitors equipment reliability and advis-es our technicians of technical failures remotely, even before the client recog-nizes it in some cases. Touch screens have promotional features and a menu of beverage options. The brewing process has variable settings. It goes on and on…The days of serving ‘hot and black’ should become a distant memory.” Appearing with increasing frequency in offices are digital bean-to-cup brewers with touchscreen technology. For exam-ple, Starbuck’s Interactive Cup Digital Brewer features a three-bean hopper and is extremely easy to use, since all a user has to do is select a coffee type and serv-ing size, and it includes a carafe option for larger groups. “Our Interactive Cup Brewer grinds and brews every cup of coffee to order through a digital touch-screen, providing a bean-to-cup expe-rience that offers convenience, variety and a quality cup of premium Starbucks coffee,” said Parker. Ragan added, “Equipment manufactur-ers will find more ways to integrate smart-phone technology to allow a consumer to have an app with pre-programmed settings

the brewer will recognize to eliminate waiting on the brewer, or dialing the optimal setting of a custom program on-screen. The coffee brewer will welcome the consumer, and use the brew routine pre-established by the consumer in the app.”

Aside from technology, both nitro cold-brewed coffee and national account programs for office coffee services are two trends also becoming more prevalent. The programs provide a nationwide link between all office branches of a company and employees, enhancing company cul-ture. With consistent pricing across the board for all locations and the ability to work with one point of contact, companies can save much time and money. “At Royal Cup, we have partners in areas where we don’t operate routes

that have long-term, successful family-based businesses,” said Chapman. “They are often the leaders in their respective markets, and they are the best at understanding the unique demands of their local market. We blend this expertise with our national account sales capabilities and then add back of the house, seamless national billing and account data information systems. We are completely connected electronically with our partners through our SAP ERP software systems. As our tagline states: ‘Seamless nationwide. Local service.’” Chapman added that in general, “[Employees] want to be romanced by the coffeehouse setting in their own break rooms. ‘Full service’ has evolved from two flavors of drip coffee to encompass an array of premium flavors, innovative options like cold-brew and nitrogen-in-fused, and single-serve technology for both coffee and tea.” Whatever the format, coffee and bev-erages in the office will only, it seems, become more convenient and various going forward. As Ragan surmised, more offices are looking for “café in a box” machinery and experiences, so that the variety and ambiance of the coffeehouse is mere feet away, in the office.

Zachery Bridgeman joined T&CTJ in April as an editorial assistant. He may be reached at [email protected].

COVER STORY

The Starbucks Interactive Cup Digital Brewer features a three-bean hopper and an easy-access touchscreen.

The trademark of Sherwin-Williams, the Cleveland, Ohio-based paint manufacturer, is an

image of a paint-covered globe with the inscription, “Cover the Earth.” Whenever I hear the phrase, I think not of the paint can, but of the ubiquitous K-Cup. According to an article appearing on seattletimes.com in February of 2014, consumers were spending 15 percent of their at-home coffee dollars on single serve coffee that year, as defined by pod and capsule brewing. This amounts to almost one-third of American households having a pod or capsule brewer. The Mintel Group, a Chicago-based market research firm, believes that single serve sales would out-gross bulk coffee for the home market by 2018. That’s impressive, but at USD $50-plus per pound, that’s nowhere near the tonnage of bulk coffee consumed at home in the U.S. Most American consumers don’t realize that they could be drinking fresh-ly brewed Hawaiian Kona at the same price as the convenience product from a capsule, which may have a disappointing cup quality and been roasted and packed a long time ago. John Sylvan invented the K-Cup in 1992. He and his college roommate, Peter Dragone, named their company Keurig (“excellence” in Dutch) and set out to conquer the office coffee world, for they, as Illy before them, thought that their single-serve invention was best suited for U.S. office environments, where the office coffee service industry had succeeded in delivering convenience, but had been doing a poor job of delivering a fresh delicious cup to American office workers since the industry’s foundation was laid in the 1950s. They found a willing part-

ner in Robert Stiller, chairman of Green Mountain Coffee, Inc., a small specialty roaster in rural Vermont, operating a roasting plant and a small chain of coffee retail stores around the state. Sylvan’s idea, and Stiller’s vision and financial resources, after a long and expensive gestation, produced a system in 1998 that was the best idea yet for delivering a fresh cup of the consumer’s choice almost instantly, with apparently little mess or waste except for its little plastic cup.

By 2006, [the now monikered] Green Mountain Coffee Roasters (GMCR) owned the North American market for single-serve, having bought out the other K-Cup licensees like Tully’s, Timothy’s, Deidrich and Van Houtte. With all the licenses under its control, it refrained from making private label capsules, pro-ducing only its own brands. A market opportunity was well exploited by the new innovation, and the SKUs of GMCR proprietary brands expanded widely to provide the consumer with a range of perceived choices. In reality all the choices were GMCR brands. The K-Cup moved into bank offices, jewelry stores, auto-mobile showrooms, and into high-rise offices, introducing more and more con-

sumers to the wonder of having a fresh individual cup of coffee of their very own choosing. Efforts were introduced to bring the K-Cup into foodservice through outlets such as Webstaurantstore.com and through cutting edge successes like a 2010 deal introducing K-Cups as the hot coffee beverage service delivery systems in 400 Boston Market locations.

Beyond CoffeeAs the original Keurig patents reached the end of their life, GMCR, seeing the rise of potential competitors who would offer K-Cup clones, made substantial efforts to bring in potential competitors as strategic-partner customers by offer-ing them private-label licensing possibil-ities. Starbucks Coffee Co. signed a five-year arrangement with GMCR in 2011. Name brands of allied products were added to the line, extending the reach of the K-Cup beyond coffee drinkers alone. Campbell Soup is available in K-Cups, as is Lipton, Celestial, Tazo, Tetley and Bigelow teas, as well as Swiss Miss hot chocolate. Coca Cola, which is a 10 per-cent stakeholder in Keurig, will be the exclusive provider of brands to Keurig’s new cold beverage system. 2013 was a banner year for K-Cup sales as the market began to swell with non-Keurig distributors serving up K-Cup copies. Within two years, America was awash in a sea of K-clones. As K-Cup compatible roasters/manufacturers fell over each other in a mad scramble to enter the K-Cup business, a multitude of compatible name plates washed over the market, pushing prices and minimum order quantities down, but Keurig’s hold on the brewer end of the K-Cup battle-field remained strong.

Covering the Earth with Single Serve: Unchained Growth vs. Environmental Constraint

single serve


In part one of this two-part series (September 2015), Donald N. Schoenholt, T&CTJ’s specialties editor, traced the history of single serve methods and devices. Part two discusses the growth and dominance of Keurig in the U.S., competition and the efforts to make single serve more environmentally friendly. By Donald N. Schoenholt


single serve

Portugal, France, Spain, Belgium, The Netherlands and Canada all outpace the United States in terms of total single cup revenue, while there is still a large opportunitiy for growth in single serve in many countries like Brazil, Sweden, Italy and Japan, as well as others.Source: Euromonitor International

Eco-Friendly ConcernsGMCR had followed Vermont’s Ben & Jerry’s model of good corporate citizen-ship and social responsibility for 30 years under the nurturing guidance of Rick Peyser, their director of social advocacy and supply chain community outreach. In the words of John Winthrop, quoted by Ronald Reagan, GMCR was coffee’s “Shining city upon a hill.” Admired by all and envied by many in the trade, but things were about to change. In 2010, The New York Times’ Murray Carpenter was first to voice environmen-tal concerns that K-Cups are neither bio-degradable, nor recyclable. At nine-plus billion K-Cups a year, it is reasonable to say that the K-Cup is an environmental threat, and that solutions are needed. His words rocked Waterbury, Vermont. “Kill the K-Cup” produced by Egg Studios, in Halifax, Nova Scotia, was a viral video where K-Cups are invading and destroy-ing the world in the style of a 1950s space invaders movie. The message is “Kill the K-Cup before it kills our planet.” GMCR acquired Keurig in 2006, and since then every new product produced by the company has been more environ-mentally sensitive and, “Is recyclable, if a person is willing to disassemble them into paper, plastic and a metal component,” according to James Hamblin in his com-prehensive article, “A Brewing Problem” (The Atlantic, March 2, 2015). Keurig has pledged that it will have a sustainable solution to its ongoing K-Cup environ-mental issues by 2020. [Keurig is current-ly the largest manufacturer of recyclable

pods in North America.] Nestlé Nespresso dominates the single serve market in Europe. Parent com-pany, Nestlé AG, recognized early that its Nespresso system had environmental issues, and in 1991 the company began a recycling program for its capsules at 34 collection points in its home country of Switzerland. Sadly, according to an arti-cle by Marc Gunther, published on The Guardian’s website on May 27, 2015, the recycling effort is failing, as most alumi-num Nespresso cups end up in a landfill. In the same piece, which lauded Nestlé’s overall social sensitivity, it was stated that the least environmentally impactful way to make and serve coffee is instant coffee. The Guardian pointed out that the study had been produced by a Nestlé consulting firm. Nestlé is the world’s largest producer of instant coffee. In creating a study on the environ-mental impact of coffee, assumptions must be made about preparation, con-sumption, energy usage and waste in the case of filter, espresso, vacuum and encapsulated beverages, so study results can be skewed by design or by inad-vertence. It is fair to say that pod and capsule machines aren’t the worst things in the world. They save electricity by not having warming plates heating, are less wasteful of coffee, are water smart–using water only for coffee that is likely to be consumed–and appear to increase sales of certified coffees such as Fair Trade and organic. Refillable K-Cup compat-ibles are now available from many sec-ondary market sources.

Pods and pads like those made by Senseo have some limited paper waste, are compostable and degrade along with their contents. The laminated roll stock that makes up the outer envelope in which the pod is packed does represent an environ-mental issue. Carpenter’s article quoted a spokesperson for the National Resources Defense Council who said that another option was to include prepaid mailers with coffee pods as Hewlett-Packard has done with inkjet cartridges. “Businesses that use Flavia pods, which are made by Mars, are able to ship the used pods to the New Jersey company TerraCycle, which will compost the coffee or tea and reuse the plastic,” according to Carpenter’s New York Times piece.

Innovations in Single ServeThere are instants in the single-serve space led by Folgers, Maxwell House, Tasters Choice, Café Bustelo, Mount Hagen, Starbucks, VIA and single-serve liquid concentrates including Bramo, Dutch Presso, JavaJuice and Pronto. Kitchen innovations are a very trend-sensitive business. In the late 1970s everyone who loved fine cooking in the U.S. craved Pierre Verdun’s 1963 new class of kitchen products: a commercial food processor retooled and marketed for home use in the U.S. under the Cuisinart brand. Introduced at the high end of the market, Cuisinart has become a caution-ary tale of a top-notch innovative brand that through mismanagement and the sale and resale of assets, has become a run-of-the-mill brand.

November 2015 31

GMCR’s success with Keurig had been so enormous that in January 2014, Green Mountain Coffee Roasters changed its name to Keurig Green Mountain, underlying the fact that the K-Cup had become the mainstay of the business. All is not perfect in Keurig paradise, however. In 2014, the Keurig 2.0 brewer was intro-duced as a proprietary K-Cup system, angering many consumers and giving the company a big black eye. The company belatedly reversed its position, but only after unremitting criticism. It is also true that when the company responded to consumer demands that it correct its course, it did so in a straightforward way, with company president Brian Kelly say-ing that their approach had been wrong and that they were going to correct their course as fast as they could. In this observer’s view, that is the sign of a good manager. However, one good man with flexibility of mind, unfortunately does not make a management team, and it appears that Keurig KOLD, the com-pany’s entrant in the kitchen-counter

cold-beverage appliance market, has been delayed, and GMCR, one of the hottest stocks in recent years, has lost 65 percent of its value in less than nine months. There is also a perception that as GMCR (KGM) has grown it has given up its human touch, becoming just anoth-er soulless corporation. This feeling is underscored by the exodus of several well-respected industry professionals from GMCR since the departure of former chairman Robert Stiller in 2012. One of those lost, Rick Peyser, is a respected voice of conscience in the trade. With Rick went some of the golden aura of social respon-sibility that he had personally brought to Green Mountain during his decades as its ambassador to coffee farmers. With one thing after another, a retrenchment was in order, and on August 5, 2015, management announced that it would lay off about 10 percent of the workforce as a response to lower sales and profits. In one day the company’s stock price fell almost 30 percent. The lay-off announce-ment probably was not the sole cause for

investor unease. It was just the last straw. Each management misstep contributed to the sense that something was really wrong at America’s star-spangled coffee success. The company has the market share, and (one hopes) the intelligence to rebound from its stumble, but while it refocuses, its competitors rejoice. Single serve has proved to be a coffee option that consumers and light-usage businesses embrace. It has replaced the automatic drip brewer as the coffee appli-ance of choice in many homes, and while there are challenges to be overcome, there are innovative people and businesses moving to meet them. If successful, there is a wonderful future ahead for a green single serve industry.

Donald N. Schoenholt said “No” to the K-Cup when offered it in 1993. He says the memory of that mistake reminds him of Adlai Stevenson’s remark about losing the presi-dential election, “It hurts too much to laugh, and I’m too old to cry.” Schoenholt may be reached at [email protected].


In the world of luxury consumable products, coffee ranks well above the average of any other item. It is both

cost-competitive and easily available to consumers. With consistent growth of an average 2.4 percent per year in global consumption since 2000, coffee as a com-modity and as a product has taken con-sumer popularity to a new level. From the “Starbucks Revolution” at the turn of the millennium to the boom of cafés and the explosive growth in coffee culture, it is no surprise that manufacturers increasingly target private label to grow market shares in the quickly expanding and competitive retail market worldwide. In coffee, even the instant sector hasn’t missed out on the recent years of growth and new opportu-nities, industry officials said.

“The use of private label in the coffee industry is nothing new, but today we are really starting to see top-quality cof-fees entering this market and positioning their names at a different pace,” said Cristina Madriñán, commercial director at Buencafé, a freeze-dried soluble coffee plant owned by the Colombian Coffee Growers Federation (FNC), which is based in Bogotá, Colombia. Private label–a product created for and exclusively sold under a retailer’s brand–started to increase shares in the competitive landscape of coffee products a little over 10 years ago. By taking on a growing presence in major retail outlets including Carrefour S.A., based in Boulogne Billancourt, France and Sam’s Club and Walmart Stores, Inc, both based in Bentonville,

Ark., the Colombian coffee sector expects the trend for private label to continue to expand. And Buencafé has its eyes firmly set on assuring that a bigger piece of this lucrative market goes back to the 560,000 coffee growers and their families who are directly supported by the FNC. “Buencafé has been in the market for private label for over 15 years. We have continued to grow along with the global increase in demand for this kind of prod-ucts and we expect this growth curve to not only continue but also to expand for our products,” Madriñán told Tea & Coffee Trade Journal ahead of the Private Label Manufacturer’s Association (PLMA) annu-al trade show that took place Nov. 14-17th in Chicago, Ill. Colombia is participating in the PLMA trade show with the Buendia Coffee LLC company, which is owned by the FNC but established in the U.S., to focus on the freeze-dried coffee and coffee extract customers in the North American market, including Mexico and Canada.

PL Global Growth Stays StrongIn a 2015 report, London-based mar-ket research group Euromonitor International, said the share of coffee products that are sold under private label has been growing consistently for the seven years from 2005 to 2012, to about 10 percent of the retail market today. “Private label coffee is still primarily a developed market option, sustained in large part by value priced modern retail-ers. Store-brand coffee has a negligible presence in Asia and Latin America, but a significant impact in Western Europe, where private label coffee accounted for 26 percent of total market volume in 2014, up from 22 percent in 2005,” said Howard Telford, senior beverages analyst for Euromonitor, in a blog post by the group published in May. Industry experts, such as the American Food Institute (AFI) in Seattle, Wash., agree that the importance of quality and price is as crucial in the equation behind a successful private label product, as price and product versatility are at the heart of the decision-making process when retail-ers contemplate launching a new product.

private label

Growing Opportunities in Private Label CoffeeThe world of coffee is home to an impressive list of suppliers for the private label market. From multi-national retailers like Sam’s Club and Costco Wholesale to supermarket chains such as Whole Foods Market in the U.S. to Tesco in the UK, coffee is the trendy product to use to win over a loyal consumer base. As the U.S. Private Label Manufacturer’s Association (PLMA) celebrates its annual convention this month in Chicago, exclusive retail brands for coffee are expanding fast. By Maja Wallengren

November 2015 33

“Our core values offer a win-win sit-uation for anyone in this market, because not only are we offering a quality product on par with the very best of the industry at a competitive price, but we also have the full endorsement of the Café de Colombia brand and everything it stands for; from quality to sustainability and corporate responsibility, the profile completes the standards required today when develop-ing a new brand in emerging market for the private label trend,” said Madriñán. “Marketers must continue to hone their marketing strategies, ensuring

that they embrace the most effective tools possible and keep the focus firm-ly on providing affordable solutions. Co-marketing national and private solu-tions, such as a name brand coffee with a private brand creamer, will not only drive basket size, but also capitalize on price elasticity,” said the AFI in a report released in January. With the PLMA show this month featuring some 1,300 companies from 40 countries, Buencafé believes this is a key event to attend in today’s market for coffee in order to attract new clients from the rapidly growing number of educated coffee lovers who want to know the origin story of the cups of Joe they drink. “We are excited about being able to showcase and promote our freeze-dried 100 percent mild-washed Arabica coffee from Colombia in Chicago because as this market expands it also continues to be more demanding,” said Madriñán. From frozen pizza to personal care products, salad dressing and coffee, mar-ket researchers unanimously agree that the trend for using private label is growing and all indications are for this upward curve to continue in the coming years.

Moving further into the niche markets of coffee there is more good news when it comes to iced and ready-to-drink (RTD)coffee products, reported London-based Canadean Group market researchers. It said that while the popularity of private label for some products like juice has weakened in recent years, the market for iced and RTD coffees has been growing over 7 percent in Europe last year. “Consumers are looking to try new, emerging products such as iced/RTD coffee drinks, but whilst they are willing to try the premium product, they want to avoid the premium price tag, so many are opting for private label,” stated Canadean Group analyst Tim Haig in a press release. Euromonitor’s Telford added, howev-er, that “to achieve parity with branded competitors, private label coffee players should continue to increase their organic and fair-trade offerings” in addition to adding new products such as flavors, roasts and single origin to keep up with the need for increasing the variety of branded coffee offered in the market. “The retailing environment in the U.S. and Europe suggests that private label is here to stay,” he said.

Bed Bath & Beyond’s private label brand, World Market, features single-origin coffees.

It has been only 10 years since the coffee growers in the Central American nation of Honduras began producing specialty coffee, but the efforts are already paying off. In part two of our series on Honduras, we will examine how the local producers have expanded into the top niche markets for not only single origin, but also single variety and single estate beans, and how Honduras is leading the way in Denomination of Origin and certified organic coffee. By Maja Wallengren Photos courtesy of Maja Wallengren unless otherwise noted.

The Rise of Honduran Specialty Coffee

special report: honduras part ii

Driving to the top of the moun-tains in the western Honduras coffee region of Santa Rosa

de Copán, the hills are covered with bright green young coffee trees spread out between layers of dense cloud forest. At altitudes well above 1400 and 1600 meters, the air here is cool and a distinct fresh woody scent with subtle notes of citrus flowers greeting visitors upon their arrival at the Capucas organic coffee coop-erative in the heart of the mountains. “This is the smell of pink cedar,” said Carlos Lara of the Honduras Western Coffees brand that is in charge of the Protected Geographic Indication seal for the region, which is home to five differ-

ent mountains. “The geography here at Capucas and the dense cloud forest cover we have helps develop the sweet notes of nuts and chocolates that are very popular with the roasters and cuppers and which the Honduran specialty coffee today is famous for,” Lara told Tea & Coffee Trade Journal during a recent visit to the region. In the global coffee trade, Honduras for years was referred to as a coffee nation only used as a “filler bean,” providing solid volumes for commercial blends and given little credit for growing quality beans. But this reputation is quickly changing. “Honduras is a big producing country with a lot of untapped potential for spe-cialty lots. Until relatively recently, almost

of all of Honduras’ production was aimed at the commercial market. However, things are evolving and the government is investing substantially in coffee and pushing quality,” said Stephen Hurst of Mercanta Coffee Hunters importers in London, England.

New Leader in Organic CoffeeOne of the greatest achievements from this latest development was in 2011 when Honduras officially became the biggest grower and exporter in the Central America-Mexico region. Shortly thereaf-ter, it also took over as the world’s largest producer and exporter of certified organic coffee, surpassing Peru and Mexico.


Santa Rosa de Copán, Honduras

November 2015 35

At the heart of these recent develop-ments is the Capucas cooperative that was founded at the turn of the millennium when the crisis brought about by the low-est prices in history in the world market forced small growers across the world to form cooperatives in order to get better access to credit, increase export volumes and gain access to the premiums offered for certified coffee. “We are very proud of the work we have been able to do here, not just in raising the volume of certified organic coffee, but also in the quality and how we have been able to open up new markets for our coffee with specialty roasters and retailers across the world,” said Omar Rodriguez, the manager of the cooperative who comes from one of the producer families with long roots in the community. With over 840 pro-ducer members (registered by October) this year cultivating a stunning 3,500 hectares of coffee, the impact is signifi-cant both in terms of the environmental impact as well as the number of people who benefit from the cooperative. In Honduras, certification has been at the center of developing the popularity for growing specialty coffees, with organic and Rainforest Alliance the leaders by far in the market. This, said officials such as Rodriguez, is because the additional premiums have provided a significant sup-port to producers during what for most of the last 15 years have been persistently low prices in the global market. “We have seen a significant share of our members not only going into certi-

fied organic, but also, because Rainforest Alliance has the highest standards when it comes to not just environmental issues but also social issues such as health and education, our growers see clear benefits to their own community and families from this,” he said. “The fact that some of the growers who may not be able to meet 100 percent organic certification can still qualify for Rainforest Alliance also makes this a very popular and solid seal because it helps prepare the growers. Once they have the Rainforest Alliance seal that opens up the doors to other certification seals too,” said Rodriguez. The figures speak loud and clear to the gains Honduras has earned for its work on producing quality beans. In the 2013-14 crop cycle, 1.1 million bags were exported as specialty coffee, fetching prices and premiums over the futures market, almost double that of differentiated exports of 586,258 bags just three years earlier in the 2010-11 harvest year. Official figures also show that specialty exports expanded 16 times

from less than 70,000 bags in 2005-06.

Winning Praise for Specialty CoffeeWhen it comes to Honduran specialty coffees, recognition has to be given to the department of Santa Barbara, which, located in the western Opalaca coffee region, has long been home to some of the best established specialty beans offered from Honduras in markets abroad. In the 2015 Honduras edition of the Cup of Excellence Internet auction, it was no surprise when a coffee from Santa Barbara took home the top prize with 91.19 points on the 100-point scale used by the specialty industry to evaluate bean and cup quality. The winning lot of 19 bags, which was produced by farmer Eulogio Martinez at his farm Los Yoyos, sold at USD $23.30 per pound in the auction—or the equivalent of 17 times the Arabica prices at the ICE futures exchange in New York at the time of the auction last July. Among the 38 lots sold at the 2015 auction, ten of the top-19 coffees were all from Santa Barbara and all scored above

Coffee picking at the Capucas organic coffee cooperative in Santa Rosa de Copán, Honduras.

Coffee produced in the mountains in the western Honduras coffee region of Santa Rosa de Copán grows at altitudes well above 1400 and 1600 meters.


87 points. It’s results such as these com-bined with the consistency in quality in coffees like those from Santa Barbara that in recent years have made international cuppers start to change their opinion on Honduras. “We have offered lots from

the Santa Barbara and Copán areas that rival great Guatemalan coffees,” marveled Thompson Owen of Oakland, Calif.-based Sweet Maria’s Coffee roasters. The official kick-off to the road toward becoming a specialty producer started in 2004 when the Honduran Coffee Institute, Ihcafe, helped set up a new national cupping school that trains cuppers on par with a three-year Bachelor degree from a university, while at the same time offers causes in coffee quality control. Ihcafe also organized all the coffee growing areas into six distinct producing regions based on geographical conditions and distinct qualities.

The Emergence of PGIAmong the pioneers in Honduran special-ty coffees, and for years the official face of top-quality beans from Honduras in the export market, the Marcala region in the southwestern province of La Paz took an early lead in 2005 with the introduction of the first seal in Central America for Denomination of Origin coffee. “We started the process in 2003 and studied how the Denomination of Origin worked in other places such as the wine industry in France, because this really is about the recovery of the name our coffee traditionally had,”

said Edgar Carrillo who was part of the original technical team working on the Denomination of Origin and today works with the Pacayal Coffee company in La Paz, where they assist local coffee producers and cooperatives that sell

coffee under the Marcala brand. When cuppers started working on identifying the cup profile of the Marcala coffee that is grown in the Montecillos mountain range for which the south-west-ern-central coffee region is named after, a total of 19 municipalities were recog-nized within the three departments of La Paz, Intibuca and Comayagua. Also known as the Montecino mountains in English, the Marcala growers continue to receive rave reviews for their coffee and have been leading the way for not only Honduras as a country, but also for other producing countries in Central

America as one of the most successful cases of establishing Denomination of Origin seals for coffee-distinct regions. “The Denomination of Origin for our coffees has been extremely valuable as a way to market our coffee and for the local

people in Marcala, this really is part of our national heritage,” said Carrillo. Following the establishment of the Marcala brand, work was launched in 2007 for a second Appellation of Origin brand, which today is Honduran Western Coffees. It covers all the coffee regions linked to the five mountains in the Copán and Ocotopeque regions and is estab-lished under the Protected Geographic Indication (PGI) seal. As of 2015, a num-ber of new Denomination of Origin proj-ects are under way for other coffee regions in Honduras. It is initiatives like this that help pave the groundwork for the growth of the specialty industry and motivates local market players, officials said. “By 2020, our goal is to be recognized as leader in the processing, commercial-

special report: honduras part ii

(Left and Above) Hondurans perform the Floclore dance to celebrate International Coffee Day.

Increasing production in the rural lands of Honduras has made the country the largest exporter of coffee in the Central America-Mexico region.

November 2015 37

ization and positioning of high quality coffees for the international market,” said Douglas Urquia, general manager of the Beneficio Santa Rosa dry mill in the town of Santa Rosa de Cobán. With over 300,000 bags of certified and differentiated coffee exported during the last 2014-15 harvest cycle, the Santa Rosa mill has already established itself as the biggest exporter of Honduran spe-cialty coffee, and local industry officials expect the figures to continue to grow. As Marcala has been a pioneer in the special-ty movement as producers, it’s Beneficio Santa Rosa that has been pioneering the focus on exports. “The Santa Rosa Mill was estab-lished less than 10 years ago with the specific purpose of raising the profile of Honduran specialty coffees, and it’s really impressive to see all the work they

have managed to achieve in such a short time,” said Diana Osorto of indepen-dent consultants SeAgro, which advises Ihcafe on coffee export strategies and also works as agents in Honduras for Brazilian coffee machinery and process-ing manufacturers Pinhalense. Equally important, the Honduran government and Ihcafe have invested heavily into infrastructure, not only for the wet and dry processing steps required, but also in the roads required to get the freshly picked coffee cherries from rural

farms to mills and from mills to the ports. Now it’s all about expanding on the posi-tive development already in place. “In the last few years we have doubled the volume of specialty coffee exported, and the volumes we sell at differentiated prices are increasing every year. Now that we have achieved the recognition as a quality producer, it’s all about keeping up the consistency of the quality we export and continuing to increase the volumes we export as specialty grade through the

attention to quality and processing,” said Basilio Fuschich Hawit, president of the Honduran Coffee Exporters Association, Adecafeh, adding, “the Honduran grow-ers have done a great job.”

Maja Wallengren has been writing about coffee for more than 20 years from over 40 coffee producing countries across Southeast Asia, East and West Africa and across Latin America. She may be reached at: [email protected].

Omar Rodriguez is the manager of the Capucas organic coffee cooperative in Santa Rosa de Copán, Honduras.

Sought after for their lovely leaf appearance, their delicate cup taste and their reported health and well-

being benefits, white teas were exclu-sively grown in China’s Fujian Province until the late 1990s. Today, they have become ISO-defined cups (International Standards Organization), produced in many countries all over the world. Under the Qing Dynasty in the late 18th century, the use of loose-leaf tea brewed in teapots had become the main tea drinking habit in China. White teas attracted attention for their beauti-

ful appearance and delicately soothing cups. At that time, these teas were made in only the Fujian province, plucked from specific tea bush cultivars: the big white leaf, Da Bai; the small white leaf, Xiao Bai; and the large leaf narcissus cultivar, Shui Xian. (These bushes still grow in their well-defined locations, all in northern Fujian Province, in Fuding, Zheng He and Jian Yang coun-ty.) Previously, white tea was a unique spring harvest that picked the bud only, called Bai Hao Yin Zhen, or Silver Needle. As exclusive terroir teas, they

were always referred to by naming the origin villages and counties. By 1890, China started to export some white teas. In order to increase avail-able volume, a coarser plucking variety was created in the 1920s, which was har-vested from the same cultivars,but during several annual pickings that included the bud and one or two more tender leaves: the White Peony, or Bai Mudan. There are two more white tea variet-ies, which were crafted later on for even larger volumes, Shou Mei and the Gong Mei. Furthermore, in the 1990s other Chinese Provinces started to produce premium white teas too, such as Sichuan White tea or Yunnan White Puer. With China’s return to the global market in the 1990s, the opening up of the country allowed for the exploring and sharing of their unique tea tradi-


white teas

White Teas: Rare, Premium TreasuresWhite teas are time-consuming and costly to produce, yet many tea lovers are attracted to their delicate nature. Despite a surge in white tea production in China, volumes remain small and geared to niche markets. By Barbara Dufrêne

(Above left) Darjeeling white tea; (Above right) Kenyan white tea; (Bottom left) Original terroir white tea from Fu Ding; (Bottom right) Original Fujian Silver Needle and White Peony.


tions. Thus, the tea world rediscovered the many Chinese specialty teas, with their specific processing techniques and their unique cultivars and plant mate-rial. In the 1990s, the West started to explore the many fine Chinese green teas. A few years later puer tea came to the West and then white tea was redis-covered, and its growth exploded in the early 2000s.

Processing White TeaIn order to better understand the devel-opment of white teas over the past ten years or so, it is important to consider the manufacturing process that has become the main aspect of the product definition today. As outlined by ISO TR/12591, “White Tea Definition,” published in December 2013, white tea is the least

processed of all tea types. After the harvest, the plant material is laid out in thin layers to allow for good ventilation and left to dry without any enzyme deactivation, rolling, bruising and cutting. The leaf is simply left on the bamboo trays to wither and to dry in the sun or indoors. In order to produce white tea, one must use the buds and tender shoots of such tea cultivars or tea varieties that are light in color and covered with fine downy hairs, which turns into in the white, silvery or light gray color of the final product. Due to the natural withering, white tea is generally lightly oxidized, hence the

very pale cup with a silvery, clay white or faint light brown tinge. Tea lovers report the apricot notes of the cup, and the Chinese tradition recommends white tea for the summer season, because it helps cool down the body temperature and reg-ulate the liver metabolism. Professor Ulrich Engelhardt and his team from Braunschweig University in Germany conducted several stud-ies to assess the white tea components. Although he would like more funding to pursue white tea analysis, he admitted that this is economically hard to justify for such a small product volume. The study results indicate that the original white tea varieties have indeed a comparatively high caffeine content, but concerning the polyphenol and theanine levels, they are comparable to green tea. Another important part of the ISO’s White Tea Definition is the harvesting method, which will either hand pick the buds only, whereby producing the Silver Needle type, or pluck the bud together with the first, second or even third leaf of the tender shoot, thus producing the Bai Mudan or White Peony type. In addition to the description of the plant source and plant parts used and the way of processing, the ISO TR also covers sensory analysis. It is underlined that the key distinctive element for white tea is the total absence of notes that indicate enzyme deactivation, such as pan firing or steaming, which is the way for processing green tea. The text also states that white teas from non-Fujian origin can possess significant additional flavors versus tradi-tional Chinese white teas.

white teas

(Above) White tea from Nepal is showcased at Marriage Frères. The image to the right displays white tea from Indonesia.

November 2015 41

Increase in ProductionIn the early 2000s, the Western demand for white teas started to increase, which was an incentive for many other tea-producing countries to launch the manufacturing of non-traditional white teas. They started to come from Ceylon, Indonesia, Darjeeling, Nepal, Kenya and Rwanda. Sometimes they were even blended with other types of teas, which confused the consumer. K. Sangmanee, CEO of Paris-based tea purveyor Marriage Frères, said he was first introduced to white teas from Nepal in 2005. Their delicate appearance and cup immediately attracted many tea lovers. It was in the context of these many “new” white teas coming to the Western

market that the Chinese delegation sub-mitted a request to have some of the most famous Chinese specialty teas, and in particular white teas, defined. That was in 2008 at the ISO Tea Plenary Session in Hangzhou, China. In order to restore fair competition and to maintain a level play-ing field, the first specialty tea type on the agenda was white tea, with the definition

officially published in December 2013 (as ISO TR/12951). (Note: The June 2015 ISO Tea plenary agreed to create a definition for another “trendy specialty tea”—traditional Japanese Matcha.) Today, the Chinese production of white teas has increased tremendous-ly. According to the official report the Chinese delegation made at the November 2014 FAO Tea Group Plenary Session in Bandung Indonesia, white tea production in 2013 amounted to around 11,000 metric tons (mt) compared with around 2,000 mt in 2004. However, some of today’s Chinese white teas are produced outside Fujian, some in Yunnan, some in Sichuan, and there are also newly devel-oped cultivars that have richer bud sets and fatter buds than the three original tea bush varieties, amongst which includes the crossbreed Fu Yun n°6. Wherever they come from, genuinely manufactured white teas from appropriate cultivars are premium cups. Their min-imal processing requires hand plucking and careful drying of the harvest during several steps. Making these teas is vora-cious in man-hours and requires special

plant material. Consequently, they are highly costly to produce. Having some white tea available on the tea estate is a proud achievement for the producers and demonstrates their know-how, whilst targeting good income and quality-con-scious consumers. Volumes remain small, however, and geared to niche markets. There remains the call for more scien-tific investigations in order to collect analytical data to confirm the levels of the various leaf components. Whilst some market experts predict good growth on the demand side, others feel that the authenticity of white teas has suffered from an oversupply of less genuine quality products and too many unfounded claims. Now that the rules have been clarified, the market is expected to settle down with white tea again appraised as genuine pre-mium product, a special treat that clearly belongs at the top of the specialty tea market segment.

Barbara Dufrêne is the former Secretary General of the European Tea Committee and editor of La Nouvelle Presse du Thé. She may be reached at: b-dufrê[email protected].

White tea production has increased tremendously in China. (Above) Sichuan white tea.

The West started to explore Chinese green teas in the late 1990s, and a few years later puer tea, shown above, arrived in the West, too.


Most of us have heard about the three pillars of sus-tainability in many types of industries. The pillar distinction has different focuses in different types of

industries. The worldwide tea industry even has different defi-nitions of sustainability. I, personally and professionally, believe that each person has his or her own definition of sustainability. As a tea buyer and the Ceylon Tea Ambassador, I have my own view of what sustainability is as it pertains to tea. First, let me start with my view of what sustainability is as a tea buyer. Regardless of what type of tea I’m buying or from where I’m buying it, I have always believed that a buyer needs to be aware of their suppliers’ needs as well as their own. When a buyer is aware of their suppliers’ needs then they have contributed to true sustainability. Let me define this as it pertains to economic sustainability. A tea buyer’s job description can vary from company to company. My approach is not only to price and quality, but also to making sure that the relationship is built on a foundation that will sustain itself. With respect to Sri Lankan teas, it’s clear to me that most recently they have been hit hard due to the Middle East crisis. When a country like Sri Lanka has government-man-dated regulations as it pertains to the estate workers that must be followed regardless of global issues, it will directly affect my supplier. A grower from Sri Lanka still has to make sure that the estate worker is cared for regardless of the prices they are getting from the buyer. I have heard that tea is a buyer’s market as opposed to a seller’s market, especially with respect to Sri Lankan teas. This has been a concern for me. Of course as a tea buyer, I suppose I could leverage my supplier’s current situation. For example, I could try to buy the same product I have always bought, but knowing that prices have fallen at auction I can get a better price from my supplier. If I do this, what would the effect be on eco-nomic sustainability? Let’s assume that a supplier/grower is pushed into lowering their price. If this price is not sustainable then there is a chance that in the future the product may not be available. Maybe the factory or estate would have to close. Regarding economic sustainability, Sanje Widyaratne, chair-

man and CEO for Walters Bay based in Austin, Texas, said, “Economic sustainability related to tea can be simply defined as paying a fair price for tea to the tea farmers and the tea process-ing factories. A fair price is a price that allows them to operate their business in a way that is socially and environmentally responsible. The way to do this is to allow the necessary dollars to flow all the way down to the end of the supply chain to the tea processing factories and the tea farmers.” As a grower Widyaratne knows first-hand the effects of his tea’s fetching a lower price at the auction. Of course no one can predict global issues and their effects on tea prices. Sri Lanka is in a unique situation compared with other tea-growing regions.

Potential for GrowthWhen you buy tea from Sri Lanka you are paying more, but there are reasons for the higher prices. First, you are getting an assurance that there is a minimum standard of living for the estate workers. In addition to a minimum wage, the Sri Lankan gov-ernment also mandates education and has prohibited child labor. Sri Lanka is committed to producing 100 percent orthodox production. Small holders produce approximately 70 percent of Sri Lanka’s tea. There are incentives to producing good tea. The Sri Lankan law requires that small holders be paid at least 68 percent of the net sales average of the factories. If tea prices

Our three-part series on Sri Lanka, written by David DeCandia, director of tea at the coffee and tea shop chain Coffee Bean and Tea Leaf and the first Ceylon Tea Ambassador to North America appointed by the Sri Lanka Tea Board, has focused on the three pillars of sustainability. Part one of our series examined the social aspect of sustainability, while part two discussed environmental sustainability as it relates to Sri Lanka’s tea industry. In part three, DeCandia will explain economic sustainability as it concerns to Sri Lanka’s tea industry from the perspective of a tea buyer and as Ceylon Tea Ambassador. He will also show how all three pillars must be in balance for there to be true sustainability.By David DeCandia

Pure Ceylon Tea: True Sustainability Part lll

special report: sri lanka part iii

David DeCandia in a tea field in Sri Lanka during the harvest season.

November 2015 43

increase, then the workers will in turn receive more money. Regional plantation companies now have an increased awareness and compliance of the social and environmental requirements at the estate level. They continue to pursue more environmentally-friendly and socially-responsible methods in all of the practices. This structure cannot be maintained if prices continue to fall and buyers continue to leverage the lower prices. When the auction prices fall everyone in the supply chain is affected in one way or another, so paying a consistent and fair price for tea is key to maintaining sustainability. Ceylon tea above all other teas has amazing potential for

continued growth, especially in the U.S. market for iced and hot tea. Climate and diversity in elevations add to the unique flavor profiles. All tea grown in Sri Lanka is now 100 percent ozone friendly. This is a distinction of which no other tea-producing nation can claim. For me, as the Ceylon Tea Ambassador for North America, brand recognition continues to be a challenge. When the country changed its name from Ceylon to Sri Lanka it lost the connection to the type of tea because the tea is Ceylon. My job is to bridge this gap and educate consumers and other industries about the benefits of Ceylon teas. Regardless of how you define the three pillars of sustainabil-ity, I believe that we all have a responsibility in making sure we do our part. Whether you are a grower, wholesaler, buyer, retail-er or customer, the estate worker should be a driving concern in your pursuit for a great cup of tea.

David DeCandia is director of tea and master tea blender at Coffee Bean & Tea Leaf, Los Angeles, Calif. As the first Ceylon Tea Ambassador to North America appointed by the Sri Lanka Tea Board, DeCandia is conducting tea programs with the Specialty Tea Institute in the U.S. and Canada to educate tea drinkers on the history, sustainable practices and culture of Sri Lanka’s signature export. With CB&TL, his position entails everything from sourcing and purchasing tea directly from estates to creating the company’s blends. DeCandia may be reached at [email protected].

As the first Ceylon Tea Ambassador to North America appointed by the Sri Lanka Tea Board, DeCandia makes educating consumers and communities about the benefits of Ceylon teas a key part of his job.

S&D Assists in Flood Relief Effortsconcord, n.c. – S&D Coffee & Tea, the nation’s largest custom coffee roaster and supplier of iced tea to the foodservice industry, donated a truckload of bottled water to help those impacted by the cat-astrophic flooding which occurred early October in South Carolina, a period of

rainfall that was record-ed as being one of the most prolific in modern U.S. history. A total of more than

16,000 one-liter bottles of water was sent to Lugoff, S.C. to help with the relief efforts in the area. “Like many people across the nation, we were deeply moved by the images and stories coming out of South Carolina fol-lowing [the] floods,” said John Buckner, vice president of marketing with S&D. “Our leadership felt the call to help, especially with the devastation occurring right in our backyard, and we hope our donation makes a difference to those that need it most.” S&D Coffee & Tea is committed to being a leader in community and sus-tainability initiatives, making a concerted effort to reduce environmental impacts and support the communities and indus-tries in which it operates.

Peet’s to Acquire Stumptown Coffee & Intelligentsia Coffeeemeryville, calif. – Peet’s Coffee & Tea announced that it is acquiring Stumptown Coffee Roasters and Intelligentsia Coffee. Peet’s will acquire ownership of Stumptown Coffee Roasters, based in Portland, Ore., from its existing sharehold-ers, including TSG Consumer Partners LLC, a leading investment firm based in San Francisco, Calif., with approximately USD $3 billion in equity capital under management, which held a majority stake in the company. Stumptown, one of the leading players in the fast-growing ready-to-drink cold brew coffee business, will continue to operate independently while having full access to Peet’s resources and scale. Stumptown will continue to pursue

its own growth strategy, operating “as is” across its retail cafés, wholesale and gro-cery channels. Terms of the transaction were not disclosed. “Stumptown’s journey has been about creating a coffee experience that surpasses all expectations,” said Duane Sorenson, founder of Stumptown Coffee Roasters. “I’m confident that Peet’s will continue to support our journey in a way that unique-ly reflects who we are.” Stumptown is one of the early pioneers of the cold brew coffee movement and has a superior posi-tion in this fast-growing category with its diverse line of ready-to-drink beverages. Peet’s is also acquiring a majority stake in Chicago, Ill.-based Intelligentsia Coffee, the pioneer of the third wave coffee move-ment. Intelligentsia will continue to oper-ate independently and have full access to Peet’s resources and scale. Intelligentsia co-founders Doug Zell and Emily Mange and co-owner Geoff Watts will retain a significant stake in the business and stay actively involved in the company’s operations. Peet’s will continue to pursue its growth strategy across its retail cafés, wholesale and grocery segments. Terms of the transaction were not disclosed. “We’re excited to welcome Intelligentsia to the Peet’s family as the growth of the super-premium coffee mar-ket continues to explode in the U.S.,” said Dave Burwick, president and CEO of Peet’s Coffee & Tea. “It’s driven by 18-34 year-olds who are more affluent, purchase premium brands from other categories like craft beer and pressed juice, and seek variety and new experiences. To capture

more than our fair share of this market, it’s important that we offer differentiated craft coffee brands with unique proposi-tions and appeal. Peet’s and Intelligentsia, along with Stumptown, are highly com-plementary brands and businesses that collectively satisfy the desires of the new coffee connoisseur.” Peet’s Coffee & Tea continues to

accelerate its growth in the U.S. premium coffee market. It has tripled its growth rate over the past few years, driven by its retail expansion into markets such as Chicago and Washington D.C., contin-ued strong growth of its K-Cup products, and acquisition of Mighty Leaf Tea, locat-ed in San Rafael, Calif., last summer. Peet’s parent company, Luxembourg-based JAB Holding Co. has been acquir-ing specialty coffee retailers in the U.S. and around the world for the past several years. JAB also has a controlling stake in Caribou Coffee Co., which is headquar-tered in Minneapolis, Minn.

Cup North to Raise Funds for Rwandan Coffee Producersmanchester, england – Cup North is welcoming an array of industry pro-fessionals, home baristas, coffee lovers and the general public from across the nation to its prime location in the heart of Manchester November 7-8th to raise funds for Rwandan Coffee producers. Cup North has teamed with Tim Williams, founder of green coffee con-sulting company Coffee Sourcing, to connect with producers in Gitesi, Rwanda with the aim of giving something back to the origin of coffee through funds raised at their event. The money raised through ticket sales at Cup North will go towards purchasing cows for the Gitesi community. “Cows are an important asset for the small-holder farmer, producing milk for nourishment and sale, as well as organic fertilizer for crops. The first year of our project will see the purchase and donation of cows to small-holder farmers contributing coffee cherries to the Gitesi station. In subsequent years we plan to continue supplying cows, and also taking the calves born from these animals to be gifted to other neighboring farmers, allowing our project to grow exponential-ly,” said Williams. He added that “working collabora-tively with the parties involved in produc-


company news

November 2015 45

ing, shipping, roasting and selling coffee from this community, we’re hoping to make an additional, tangible and sustain-able difference to the livelihoods of the people doing the growing.” Hannah Davies, event director, said, “We hope to be able to continue this rela-tionship through future events, enabling us to grow and nurture our investment into Gitesi.” Coffee from Gitesi, which is being import-ed by Oslo based Nordic Approach and roasted by London roasters Workshop Coffee, was available to purchase prior to the Cup North event in November. For more infor-mation visit: http://cupnorth.co.uk/location.

DAVIDsTEA Available on Air Canada montréal, canada – DAVIDsTEA Inc. is expanding to new channels, begin-ning with Air Canada. Forever Nuts and Cream of Earl Grey sachets, served in DAVIDsTEA’s teal, 10-oz. cups, are now available for purchase on Air Canada and select Air Canada Express flights 90 minutes or more on domestic Canada and U.S. transborder routes.

“We are pleased to be a featured sup-plier for Air Canada. With this launch, we believe there is an opportunity to increase our brand visibility through fur-ther development of our omni-channel strategy in North America, with a focus on the Hotel, Restaurants and Institutions (‘HRI’) sector,” said Sylvain Toutant, president and CEO. “Our introduction on board Air Canada coupled with our store openings in two new markets in the U.S. should continue to raise the profile of our brand, which is a key area of focus in our marketing initiatives.” The new Mall of America stores in Bloomington, Minn., and Del Amo Fashion Center in Torrance, Calif. rep-resent two new markets for the company. Additionally, Water Tower Place joined as the sixth store to open in the Chicago region. The company’s new locations also include Canadian openings, namely

Kildonan Place in Winnipeg, Manitoba, St. Laurent Centre in Ottawa, Ontario and Regent Mall in Fredericton, New Brunswick. These six new stores will feature DAVIDsTEA’s full line of teas, gifts and accessories, including their new Pumpkin and Cold collections. DAVIDsTEA is a fast-growing branded beverage company, offering a differentiated selection of proprietary loose-leaf teas, pre-packaged teas, tea sachets and tea-related gifts and acces-sories. As of October, the Company owned and operated 173 DAVIDsTEA stores throughout the U.S. and Canada.

Ally Brazilian Further Expandsplantation, fla. – Ally Brazilian Coffee Merchants is an expanding green coffee importing company with integrated farming, milling, transpor-tation, and export operations in Belo Horizante, Minas Gerais, Brazil. Ally’s fine commercial coffee division is based in Plantation, Fla., and its growing spe-cialty division is based in Taylors, S.C., where the team recently hosted the first of several Q-Grader courses and exams scheduled for this year. Ally is increasing its microlot and sin-gle origin offerings alongside its increas-ing sponsorship of educational program-ming. “As we grow we want to focus on educating our customers in all aspects of the business, from the farm through to the barista’s role,” said Ricardo Pereira, head of Ally’s Specialty Division, at the compa-ny’s New York office launch in October. Ally’s offerings are warehoused in nine locations around the country, notably Continental Terminals in New Jersey and the Annex in California, at both loca-tions receiv-ing more and more coffees from single farms and estates, particularly from Central America and Colombia. While Ally specializes in Brazilian growth, the company has seen the excitement among roasters for rela-tionship-based purchasing models and is

therefore expanding its specialty offerings, beginning with farmer collaborations.

A Green Win for Java Planettampa, fla. – Java Planet Organic Coffee Roasters, the largest local provider of USDA certified organic coffee in the Tampa Bay area, was recently honored with a Sustainable Business Award at the University of Tampa’s Vaughn Center. The 7th Annual Sustainable Business Awards is sponsored by the Sustany Foundation, a facilitator of sustainabili-ty through efficient and effective aggre-gation and investment of resources for Tampa Bay’s citi-zens, in conjunction with the Sustainable Business Coalition of Tampa Bay and the University of Tampa Center for Ethics. The award honors good stew-ardship in regards to three resources–people, planet and prof-it–through innovative practices, products and services. To differentiate their business and showcase an innovative approach to cof-fee roasting, Java Planet obtained cer-tifications with the following organiza-tions with Certified Organic by Americert International, Fair Trade USA, and many of their coffees are also certified Shade Grown and Bird Friendly. Family-owned Java Planet was nomi-nated for the award by a Java Planet cus-tomer, Barbra C. Anderson, a sustainabil-ity specialist. “I was moved by the mission of Java Planet: to educate people about the importance of buying and consuming organic products. I admire the commit-ment of the founders, Jennifer and Mike Simmons, to ongoing education about the importance of drinking coffee that is certified organic and Fair Trade.” Java Planet is certified 100 percent organic and 90 percent of the Arabica coffee beans grown are also Fair Trade. Java Planet Coffee is available at many local markets and restaurants and online at www.jporganiccoffee.com.

Lowell Shindler Posthumously Named 2015 NAMA Coffee LegendThe National Automatic Merchandising Association (NAMA), based in Chicago, Ill., announced that Lowell Shindler, co-founder of U.S. Coffee Inc., has been posthumously named the 2015 Coffee Legend. Shindler, who passed away in 2012, is being honored for his contributions to the coffee service chan-nel over a 44-year career in the industry. Howard Chapman,

chairman of NAMA, presented the award to Shindler’s son, Douglas Shindler, at NAMA’s Coffee, Tea & Water confer-ence that took place in Washington, D.C. November 2-4th. “A NAMA Coffee Legend is a pio-neer, an innovator, a leader and a vision-ary in the industry. This defines Lowell Shindler and his impact on the coffee service industry,” Chapman said.

Shindler began his career in coffee service in 1968 with his first company, Coffee Hutch, carrying machines door-to-door. In 1971, he joined forces with Steve Trapani to form Bunn Coffee Service, bringing the innovative idea of coffee service to businesses throughout the New York area. They pio-neered a more engaging and productive workplace by providing high-quality coffee in-house.

The company evolved over the years, eventually becoming U.S. Coffee, Inc., in 2000. Today, U.S. Coffee offers more than 2,000 products and 40,000 office supplies. A pioneer in single cup brewers in the early 1990s, Shindler became one of the first exclusive Starbucks distributors in the New York region as well as one of the first Keurig distributors in 1998. He soon expanded his business, adding water coolers, full-service vending and office supplies and was one of the first to have a full e-commerce website. Well known for his dedication to charity work, Shindler was recognized by Long Island Cares/Harry Chapin Food Bank as “Largest Product Donator” 10 years in a row for their annual food drive. He also received numerous awards from the Long Island Network of Community Services, including their Certificate of Excellence, and was involved with the Leukemia & Lymphoma Society and the Foundation for Sight and Sound.

Griffith Appointed Strategic Alliances Chair for IWCAHelen Griffith, director of marketing for Concord, N.C.-based S&D Coffee & Tea, the nation’s largest custom coffee roaster and supplier of iced tea to the foodservice industry, has been named strategic alliances chair of the International Women’s Coffee Alliance (IWCA), a non-profit, organization ded-icated to empowering and enriching the lives of women in the coffee industry. Griffith became active in IWCA soon after joining S&D, first attending the organization’s third bi-annual convention, then becoming a board member serving in the role of marketing chair. With this appointment, Griffith will serve a two-year term on the organization’s board of directors and is responsible for developing, expanding and maintaining global relationships, partnerships and programs to build a solid network of strategic alliances to help strengthen the IWCA’s worldwide impact. Her appointment went into effect at the IWCA Convention that was held October 16th in Bogotá, Colombia. “I believe in the work of the IWCA and its mission of empowering women in the international coffee community to achieve meaningful and sustainable lives and encouraging and recognizing the participation of women in all aspects of the coffee industry,” said Griffith. “Serving on the board not only allows me to leverage my work experience, but also provides me with the opportunity to give back to this community in a meaningful way.” Through its volunteer network, the IWCA seeks to drive progress along the entire supply chain through collaboration, education, training, workshops, fundraising and sponsorship opportunities. In addition to supporting these initiatives with her expertise, Griffith will seek to incorporate her IWCA expe-riences into her day-to-day role at S&D, helping to broaden the perspectives of her coworkers and industry partners.

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At the start of this year, I received an invitation to par-ticipate in an educational coffee camp for promising young coffee growers. These young growers were select-

ed from throughout the coffee-growing regions of Antioquia, Colombia. Without knowing much more about what this camp would entail, I quickly accepted, as I am interested in knowing how the next generation of coffee farmers will approach the challenges before them. I also very much want to learn about different coffee regions, many of which were unknown to me, and, in the case of Antioquia, to many others in the specialty coffee industry as well. A few weeks before the proposed date in June, I received confirma-tion of the dates and excitedly embarked on this new adven-ture with the help and support of my team members at Allegro Coffee Roasters. I arrived on a Sunday night, delighted to find that every-thing was very well organized. I, and other coffee roasters and journalists, were met at the airport by folks from the Governor’s office and then left immediately for our hotel. Early the next morning, the excitement began. We went to visit the winning farms of the recent “The Best of Antioquia” contest, which were located about one and a half hours from Medellin along precipitous roads that I do not recommend to those who suffer from nerves. These farm visits were extreme-ly valuable, especially in order to appreciate the tremendous amount of work that these farmers do with enormous difficulty, walking along steep trails and through the fields, without access to roads, in order to tend to their trees and harvest their coffees. It was at these farms where we heard for the first time about the impact that the coffee programs in Antioquia are having on the education and motivation of their young coffee farmers. They told us of the renewed determination of these young men and women to take charge of their, farms and to use new systems of production and new agricultural practices, in order to obtain better quality and higher yields. The camp began the next day. One thousand youths from ages of 15 to 30 had arrived from all the coffee producing com-munities of Antioquia; some of them had even traveled by bus

for more than ten hours. They were all happy and excited to learn more about coffee. In a very organized process, the par-ticipants were divided into groups in which they would learn different topics: cupping, toasting, commercialization, fermen-tation processes and new technologies. I had the opportunity to join the commercialization group, where I was able to share with the participants how companies like Allegro Coffee Roasters buy coffee and about some of the things that we try to focus on and take into account when we decide to make a purchase, such as coffee quality as well as social, worker and environmental responsibility. The first five minutes of the classes were always a little quiet, but after that the participants exploded with questions and began to share their projects and the business plans that they had developed for themselves and their communities. Never before in any part of the world have I seen young people with so much passion and desire to work and get ahead. These young adults took every advantage of even the slightest chance to learn. Many times the allotted class time wasn’t long enough, and the participants stayed after class trying to solve and understand anything that was unclear to them. Throughout the entire camp session, this phenomenon repeated itself, again and again, as dozens of students hungry for knowledge entered and left their classes, although I suspect the person who learned the most during this camp was me. I learned to value every small opportunity that we have in our lives, and I learned that dreams, accompanied by work and effort, could become reality. I hope that many people will become involved in this project and support these youths. There is much to learn from them and from what is taking place in Antioquia. Truly, it is a model for all of us in the coffee industry to follow. I do not know if Antioquia will become the hub of specialty coffees in Colombia, but I can say that it already is the center of hundreds of young entrepreneurs who are going to change Colombia, in this way maintaining the heritage and birthright for which generations of Colombians have fought so hard.

Josemaria Ruiz Gonzalez works as a farm relationship man-ager for Allegro Coffee, a subsidiary of Whole Foods Market based in Thornton, Colo. He received his bachelor’s degree in agriculture from the University of Costa Rica and his MBA from the University of Navarra in Spain. He may be reached at [email protected].

Camp for Antioquia’s New Generation of Coffee Growers

THE CUPStraight from

Views expressed in Straight from the Cup (SFTC) are not necessarily those of Tea & Coffee Trade Journal or Lockwood Publications. If interested in authoring an SFTC column, please contact Vanessa L. Facenda for full details or questions concerning submissions: [email protected]. Articles must discuss or analyze a relevant issue, trend or event within the coffee or tea industry, not solely promote a company or its products.

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