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Gudang Kopi Pagar Alam, Pagaralam (2026)

12/06/2026

Coffee Barometer 2026 highlights the persistent systemic and structural imbalances in the coffee sector
The report provides a twenty-year overview of the coffee sector, shedding light on the systemic issues that still leave producers vulnerable despite historic price highs reached in recent years

June 12, 2026

The Coffee Barometer 2026 was published yesterday. This biennial publication is produced by a group of NGOs (Conservation International, Ethos Agriculture, Solidaridad Network and VOCAL), with the support of the German Federal Ministry for Economic Cooperation and Development. The report provides a twenty-year overview of the coffee sector, shedding light on the systemic issues that still leave producers vulnerable despite historic price highs reached in recent years.

“Two decades after the first Coffee Barometer, the structural conditions shaping the coffee sector remain largely unchanged,” says the report in its introduction. “Producer incomes still fall below living income benchmarks, labour is poorly rewarded, climate vulnerability continues to deepen, and most value is captured downstream rather than in producing countries. Sustainability commitments have multiplied, yet systemic reform has not followed. This report examines the coffee economy not as a collection of sustainability initiatives, but as a political and economic system shaped by concentration, power, and commercial incentives that consistently produce inequitable outcomes.”

The Poverty trap Coffee remains fundamentally a smallholder sector and that is both its defining feature and its central challenge. Around 12.5 million farming households, most cultivating less than two hectares, produce the majority of the world’s coffee while struggling to secure a viable income. Even during the record price cycle of 2025, higher market prices translated unevenly into improved farmgate incomes, while input costs continued to rise. Women and seasonal workers, who provide much of the labour that sustains production, remain largely invisible. Climate change is steadily narrowing the window for adaptation. Suitable growing areas are shrinking, and intensive monoculture systems are showing signs of ecological stress. Sustainability investment continues to cluster around commercially visible targets rather than the underlying conditions on which the sector’s long-term resilience depends.

Limited reform, rising expectations The coffee crisis of the early 2000s was a turning point. Prices collapsed to historic lows, millions of smallholders fell into distress, and the sector’s vulnerabilities became impossible to ignore. As intergovernmental ambition faltered, companies turned to voluntary sustainability standards, delivering real gains in awareness and traceability, but leaving market structures intact. The mass market did not absorb the higher costs associated with more sustainable production. That constraint is now being challenged by emerging regulatory requirements. A wave of regulation on deforestation, due diligence, forced labour, and greenwashing is redefining the conditions of market access. Whether this delivers meaningful change will depend on how companies respond: compliance alone will not improve producer livelihoods without stronger commercial commitments and active support for farmers.

Collective action gaps The sector’s collective response to persistent poverty, climate risk, and labour exploitation has taken shape through multi-stakeholder initiatives. These platforms have built shared frameworks, improved data, and put sustainability on the boardroom agenda. But coordination has consistently outpaced commitment. MSIs (Multi-Stakeholder Initiatives) have established living income benchmarks and convened the right actors; however, accountability mechanisms remain weak, representation favours multinational buyers and donors over producers, and funding falls short of the sector’s ambitions. Voluntary collaboration has not reshaped the market structures that drive inequality. As mandatory regulation begins to set a baseline, MSIs have the convening power and capacity to push ambition beyond compliance, but only if the capital follows and producer voices carry genuine weight in setting the agenda.

Value extraction The coffee sector generates substantial value, but little of it flows back to where coffee is grown. Farmers carry the most labour-intensive and climate-exposed stage of production, sustained by unpaid family labour that subsidises the rest of the chain. Market consolidation concentrates buying power among a handful of traders and roasters; premium formats generate vast markups that bypass producers; corporate structures channel profits through low-tax jurisdictions; and large companies return billions to shareholders even in years of weaker performance. These are not isolated examples; they are structural features of the coffee economy that direct value downstream while pushing risk upstream. Governments, companies, and civil society will need to address these dynamics more explicitly. Without honest scrutiny of how value is extracted, and profits are shielded, sustainability discussions risk remaining disconnected from the sector’s underlying economics.

Opacity undermines accountability As regulatory pressure grows, companies are expanding their sustainability activities, and a small group has made measurable progress on climate and deforestation. But many are simultaneously disclosing less, replacing independent certification with proprietary systems that limit external scrutiny, and quietly stretching timelines on earlier commitments. The most critical gaps remain unaddressed. None of the fifteen largest roasters and traders discloses pricing structures or contract terms — the very mechanisms through which value reaches, or fails to reach, producers. Living income does not feature in procurement practice. Climate adaptation investment, critical for the smallholder communities on which the sector depends, remains obscured by the absence of transparent reporting. The incoming wave of mandatory legislation could change this, but only if companies treat compliance as a starting point rather than a substitute for the deeper commercial commitments the sector requires.

Conclusion Two decades of coffee sustainability efforts have delivered real but insufficient gains. Voluntary standards raised awareness; MSIs built shared frameworks. But both have sidestepped the reforms that matter most: mandatory price transparency, enforceable living income benchmarks, and procurement practices that reflect the real costs of production. This is also evident in the environmental challenges on which coffee ecosystems depend, including deforestation, biodiversity loss, and climate change. The sector has treated systemic failures as technical problems, addressing symptoms at farm level rather than confronting the underlying commercial conditions. Regulation is now imposing from outside what the sector has been unwilling to accept from within, but regulation alone will not be enough. Companies must redistribute value, not simply account for it. The sector faces a clear choice: keep managing the appearance of progress, or undertake the structural change a resilient coffee future demands.

The report has already prompted initial reactions and responses from major players in the coffee industry, such as Nestlé, and fair trade organisations, such as Fairtrade. Many more are likely to follow in the coming days.

12/06/2026

Regions on the Rise: Papua New Guinea

by Myles Hume June 12. 2026

In Papua New Guinea, coffee is a lifeline powered by millions of smallholder farmers whose family-run plots sustain the country’s economy and its communities.

Shortly before Papua New Guinea (PNG) gained independence from Australia in 1975, Wakpi Keu was introduced to coffee and advised that if he planted and tended to his crop, it would alter his family’s future. Little did he know this would span generations.

“He was told ‘your son will use this coffee to go to school and university’,” says Emma Wakpi, his granddaughter, who today runs Jiwaka Coffee, a social enterprise that works with 904 PNG farmers from 11 villages to purchase, process, and export specialty Arabica.

“The administrators at the time saw the people in the village needed something that would create cash for them, because the country was moving away from a barter system to more cash-based economy. They looked at what could work, and there was coffee.

“My grandfather planted the coffee, got money from that, and my father became a civil engineer through coffee. He started his own construction company, and through that, was able to afford a good education for me and my siblings.”

Stories like the Wakpi family can be found all over PNG, where around 2.5 million people grow coffee. In a country of around 10 million people, that’s one in four people growing coffee – mainly on family-run, smallholder lots up to five hectares – with the crop considered a powerful currency.

Much of PNG society revolves around the coffee season, with picking, selling and processing taking place from March to May, leading to a festive period in June and July.

“Many treat coffee as their ATM. Coffee is the cash crop,” says Wakpi tells Global Coffee Report. “If they’re in need, they go out, they pick the coffee, bring it back, get the cash that they need, and go take their loved ones to the hospital or pay for school fees etc.

“But that’s something we are trying to shift the mindset around, we want more people to be treating coffee as more of a business.”

These smallholder farmers dominate the PNG coffee landscape (89 per cent), followed by blockholders (eight per cent), and plantation owners (three per cent).

Wakpi’s home province, Jiwaka, is considered one of the major producing regions, with 14 per cent of PNG’s coffee grown there.

According to official data, the Eastern Highlands produces 45 per cent, the Western Highlands 22 per cent and Morobe eight per cent. Each are located on or near the Owen Stanley Range, with coffee grown at altitudes of 1,400 to 2,200 metres above sea level, and ultimately sent to Lae Port in the country’s east for export.

“For export to Australia, the transit time from Lae is only seven days. Quite often the coffee can arrive before the documents,” says Jon Edwards, a coffee sector advisor who has worked in the PNG coffee industry for more than 40 years.

Edwards has been involved in all sides of PNG’s coffee industry. He was once General Manager of PNG Coffee Exports, one of the oldest exporters in the country, and on the board of the PNG industry regulator, the Coffee Industry Corporation (CIC).

Today, he serves as a coffee advisor, supporting sustainable supply chains, coffee sector development, and the growth of small to medium enterprise (SME) exporters, with a focus on strengthening Australia’s coffee relationship with PNG to drive greater economic prosperity in the origin country.

He says PNG’s Arabica coffee was recently streamlined from 13 to five grades, with the United States being the largest market for its A Grade coffee (44 per cent), followed by its closet neighbour Australia (15 per cent) and Japan (seven per cent).

The bulk of PNG’s B and Y Grade coffees (47 per cent and 46 per cent, respectively) go to the EU, with Australia also making up around 15 per cent of exports for these grades, he says, citing official data.

“What’s interesting about the PNG is that 80 per cent of its income earnings come from mining, but 80 per cent of the population are employed in the agricultural sector, and within that coffee is number two in terms of export earnings (22 per cent), second only to palm oil 39 per cent,” Edwards says.

“Coffee is higher value, but the volume of palm oil is huge – hence its export earnings. But coffee is by far the biggest employer of people.”

Edwards notes PNG’s exports in the last five to six years have averaged around 800,000 60kg bags per year, which is down from around one million bags in a bygone era.

But the issue is more nuanced than this, with PNG’s coffee quality improving. Traditionally, the country has been a big producer of Y Grade coffee, working as “a heavy lifter” in blends.

“That is still the case today, but we can see the quality is improving. So even though the overall volume of exports is dropping, the percentage of premium coffee is increasing,” Edwards says, noting that Y Grade – once the majority – accounts for around 42 per cent of PNG coffee today.

Several factors are contributing to lower yields, he says. As the population grows, Edwards says many farmers are swapping out their coffee for vegetables to feed their communities. And with four harvests per year, compared to one coffee harvest, it’s proving more lucrative.

“We also have a very old tree population in PNG, around 70 years old on average, compared to the bigger, more disciplined countries that will replace their coffee maybe every 20 years,” he says.

“The variety of tree in PNG is excellent. It also speaks to the quality of our soil. But having said that, our production per hectare for smallholder is around 300 kilos of green per hectare where other countries expect 700 to 800.”

Limited farm management practices constrain production potential. Edwards notes that key activities such as pruning, tree husbandry, input application, and w**d control are often not carried out consistently. In particular, farmers may avoid pruning when some developing cherries are present, viewing them as potential income, with the longer-term productivity benefits of pruning not fully considered.

“Coffee growers in Papua New Guinea often treat their crop as a form of savings, holding parchment coffee until funds are needed for specific social or household expenses,” he says.

“Sales typically increase in January and February as families meet school fee obligations or prepare for key events. While storing parchment carries risks to quality and potential theft, it is generally viewed as a more secure and less tempting way to save compared to holding cash, which can be more easily spent.”

In PNG, coffee is an “amazing currency hedge”, Edwards says, with it being a US dollar-based trading commodity by default and design.

“The last few years, you’ll see the volume has improved, and that has been because of the higher green bean price. It’s price-driven volume: the higher the price, the more PNG farmers will tend to and harvest their coffee.”

While efforts have been made to improve infrastructure, PNG’s geography is arguably the biggest barrier for farmers. Edwards says many coffees are grown in “very, very remote areas” with “horrendous” access roads.

“People will walk for three days with a bag of coffee on their back to a road that is accessible for them to sell,” he says.

“PNG is one of the few countries, if not the only country in the world, that freights their coffee in aeroplanes from these areas at 700 kilos a load.”

That geography also has a bearing on how the coffee is prepared for sale. One of the advantages for PNG farmers is they can sell it in any of the three formats: cherries, parchment (at any moisture level) or as green beans.

“If they’re living next to a factory, they can obviously take it there and have it processed for a fee and then sell it as green bean to extract more value,” he says.

“If they’re living in the bush, very remote areas where the cherry trucks can’t come, they’ll often pulp it themselves by hand, turn it into dried parchment, and walk it to the road to sell it in that form.”

Bringing mills to farmers

One of the reasons PNG coffee quality is improving, however, is the advent of central wet mills set up in communities, close to farmers.

“They can accept a lot of cherry – and because they adopt a disciplined processing structure, we’re seeing a much more regular lot of coffee,” says Edwards. “That’s why we have seen growth in A and B Grade coffee out of PNG.”

Emma Wakpi also recognised this problem: the distance between farms and buying stations. She notes there is little infrastructure in rural areas and roads are often impassable. For women, it can also be dangerous to travel, yet many farmers are forced to do so on foot for many miles carrying their harvest.

Wanting to change this system that unfairly disadvantages the coffee grower – and reduces their income – in 2018, she set up Jiwaka Coffee, which focuses on specialty coffee production with a wet and dry mill built on tribal land in Minj.

The social enterprise handles single origin, shade-grown, specialty heritage Arabica coffee from the Waghi Valley in the Central Highlands, taking cars to pick up the coffee at the harvester’s farmgate.

It’s a chance to give back for Wakpi, who was raised a few hours away in a mining town and prospered thanks to her father’s career – which was built on the coffee her grandfather originally grew in the Jiwaka province decades ago.

“As much as we’re pursuing our own things – how much are we giving back to community as well? That’s something my father instilled in me and my siblings,” she says.

“When we would go back to Jiwaka, we’d watch people picking their coffees early in the morning, walk kilometres down to the roadside, waiting hours for the coffee cars to come, weigh and buy the coffee. It ate into their resources that could have been employed elsewhere.

“Dad said, ‘why don’t we establish a dry mill right up the road where the village is, so people don’t have to go as far and just process with us’.”

But Jiwaka Coffee is much more than this. Wakpi realised farmers’ livelihoods would only prosper if they were educated on areas like health, businesses and sustainable farming practises. The organisation sends experts into farming communities to upskill growers.

“We inform them of the value chain, when to pick red cherries, why it needs to arrive at the washing station within a certain amount of time because of fermentation, not picking during the rain,” she says. “That increases their knowledge and how they value their own coffee.”

Many of PNG’s smallholders farmers operate what’s referred to as a ‘coffee garden’, ranging from as few as 10 trees to hundreds – or even 3000 in some cases.

“In Jiwaka, almost everyone has some sort of coffee garden. What we’re trying to do now is shift that terminology. The world is changing. Coffee is being valued differently. With social media and better access to information, people now understand more than they did a few years ago.

“The conversation becomes: how do we start seeing this as a business, and treat it that way? How do we value it properly, and approach it with the same mindset as any other enterprise – and thinking about concepts like intercropping.”

Wakpi is encouraging smallholder farmers to treat it like a nine to five job, just like a teacher in a classroom or a nurse in a health centre.

“You are the coffee businessperson, working in your coffee ‘office’,” she says.

“While you’re there, you’re pruning, maintaining the trees, and at the same time planting traditional vegetables. It becomes one system, one way of working: you produce coffee as your income, and food to support your household.”

Market dynamics
As PNG coffee looks to the future, small and medium exporters like Jiwaka Coffee are expected to play an even bigger role, leveraging their ability work alongside farmers with cultural awareness and understanding of the challenges they face.

Edwards says the main exporters used to account for 70 per cent of the market.

“What’s interesting about the PNG market right now, is that it’s a very competitive space, with all the big four global players in green coffee trading operating there and now accounting for around 68 per cent of the market,” says Edwards.

“You have much more competition, sophisticated competition, people who have instruments to manage risk, to take forward contracts, finance is readily available, etc. But you have all of that sitting now in a pie that is slowly shrinking.

“A part of that is the rise of small and mid-sized exporters who can deal much better with small supply groups. They can get down and dirty and rub shoulders, if you will, with their supply chains.”

Big or small, each of those exporters is regulated by the CIC, which holds significant sway in PNG.

“The CIC is responsible for all licences encompassing wet mills, dry mills, green bean exporters and roasted coffee exports,” says Rose Romalus, CIC’s Senior Quality Control Officer. “We are also responsible for the licencing of freight forwarders, those who handle coffee on behalf of the exporters at the port end.”

Edwards, a former CIC Board Member, notes that the regulator holds significant influence over the sector.

“The industry ultimately benefits from this level of oversight. Every container exported is inspected and cupped by Rose and her team, ensuring consistent quality standards,” he says.

“Pricing is also monitored to ensure sales reflect prevailing market conditions, which helps maintain the credibility and reputation of PNG coffee.”

He adds that PNG’s membership of the International Coffee Organization further reinforces this credibility through structured reporting and market transparency.

Romalus is positive about the future of PNG coffee, especially as more farmers professionalise their approach to coffee.

“The number of local exporters that we now have here is a testament to, or evidence of, people now taking coffee more seriously,” she says.

“If you compare that to three to five years ago, we have a good number of local exporters who used to be just farmers before, but now they’re treating the coffee as a real business.”

She says the revised Green Coffee Standard has now been reduced to five Arabica grades, with A and B being the specialty/premium grades and Y, Y2, and Y3 being the commercial grades.

“The revised grades provided equal opportunities for smallholders to improve the quality of coffees through the application of post-harvest best practices and trade as higher grades,” she says.

“In the last three years, volume of B grades has increased, and Y reduced, and as a result, the industry has seen the value of coffee doubled in 2023/2024 Coffee Year and also significantly increased in 2025.”

12/06/2026

Germany’s coffee habits are changing

Key takeaways
• Record whole bean coffee sales signal that Germans prioritise freshness and quality.

• The country’s coffee market hit a record €8.98 billion in 2025.
• LAP Coffee’s VC-backed expansion threatens Berlin’s independent specialty cafés.

• Rising at-home consumption creates both opportunity and pressure for roasters and coffee shops.

• Around 200 million cups of coffee are consumed daily in Germany, according to CBI, and nearly 89% of German adults drink it regularly.

The story of coffee in Germany begins in the late 17th century, when the first coffeehouses opened in cities like Hamburg and Bremen. By the 18th century, coffeehouses had become social hubs, and consumption spread quickly. By the 20th century, filter coffee had become the default brewing method in most German households, and major roasters like Melitta, Tchibo, and Dallmayr had made Germany one of the world’s most important coffee import hubs.

Today, this position holds. Germany is Europe’s largest green coffee importer, sourcing over 90% of its coffee directly from producing countries. In 2024, Germany imported just over 1 million tonnes of green coffee. Hamburg’s port remains Europe’s largest coffee hub, and the country is home to approximately 2,500 roasters.

Germany’s mature coffee market is shifting

The most telling indicator of where Germany’s coffee market is heading is the continued rise in whole-bean sales. Whole bean market share reached 46.6% in 2023, while single-serve sales fell by 24.7% and roast & ground coffee by 20.2% in the same year.

In 2025, whole-bean consumption hit a record 193,800 tonnes, more than doubling over the past decade. According to Deutscher Kaffeeverband, one in three German households now owns a fully automatic coffee machine, indicating that consumers increasingly prioritise quality and freshness.

“Germans have always cared about their coffee, and interest in making better-quality coffee at home is only growing,” says Alex Bidstrup, a barista working at several cafés in Berlin. “Bean-to-cup machines handle the entire coffee-making process, from grinding to milk foaming, so it’s a matter of convenience, as well as freshness.”

Despite this growth in quality-oriented consumption, the picture remains complex. Inflation has pushed a large share of German consumers towards cheaper products, including coffee. At the same time, overall coffee market value rose sharply.

The total value of roasted coffee jumped 23.5% to €8.98bn in 2025, the highest ever recorded in Germany, even as volume declined slightly by 1.5% year on year. Essentially, Germany’s coffee market is consuming less by weight but spending significantly more per cup.

Changing consumption habits also coincided with a major geopolitical shift. Following the 50% US tariffs on Brazilian goods, Germany became the largest importer of Brazilian coffee, underscoring the sheer scale of its purchasing power and signalling how global trade disruptions can redirect entire commodity flows through ports like Frankfurt and Hamburg.

But signs of tension are growing

Despite overall growth, Germany’s changing coffee market is showing signs of tension. This is especially apparent in cities like Berlin, Munich, and Hamburg, all of which have well-established specialty coffee scenes.

LAP Coffee, a venture capital-backed chain, has opened 30 stores across the three cities and is planning to add another 20 this year, targeting Cologne, Düsseldorf, and Frankfurt. Its formula is built around compact shops, minimal staffing, digital ordering, and cappuccinos priced at €2.50.

LAP’s rapid rise has put pressure on even well-established specialty roasters and independent cafés.

“We have been trying to justify higher prices for over a decade, so it really disrupts the specialty scene, especially in cities like Berlin, where a lot of consumers are against corporatisation,” Alex says. “It’s not just about paying more for coffee itself, but also fair wages, skilled baristas, and higher rents.”

The startup’s expansion has divided Berliners, prompting an online campaign dubbed “LapCoffeeScheisse” and a wave of vandalism, with many of its blue-and-white grab-and-go outlets splattered with red paint in October 2025. Critics argue that because LAP is not under pressure to turn a profit in the near term, it can price below the market cost of quality coffee and grow aggressively in the meantime.

“I think LAP Coffee will become increasingly present in the coming years and will displace many specialty shops,” Alex says. The chain’s rapid growth is fuelled by investors including HV Capital and Insight Partners, resources that independent roasters simply can’t match.

Similar tensions are emerging in cities like New York and London, where the rapid scaling of other venture-backed chains, such as Blank Street, that rely heavily on automation is pressuring independent businesses.

Looking ahead

Despite inflation and declines in overall volume, Germany’s coffee consumption isn’t retreating. Out-of-home coffee consumption hit an all-time high of 125,500 tonnes in 2025, surpassing the previous record set in 2018. At home, the growth of whole bean sales and fully automatic machines points to a consumer base that is investing in its coffee experience rather than trading down.

For roasters, this creates genuine opportunity. Bean-to-cup machine ownership means more households grinding beans fresh, buying with more attention to origin and quality, and engaging with the product in ways that ground coffee never encouraged. The German retail market is expected to grow by 3.2% yearly until 2028, with specialty coffee identified as a key driver.

The challenge for independent roasters and café owners is different. Rising costs, a competitive market, and now fast-expanding chains backed by substantial capital are compressing margins on multiple sides. Euromonitor analysts have noted that negative economic factors may lead to stagnation in the mid-term coffee sector, with cafés facing particular pressure.

A resilient market
Berlin’s specialty scene has absorbed challenges before, and its foundations remain substantial. The city is home to roasters like The Barn, Five Elephant, and Bonanza Coffee, and the number of registered specialty cafés in Germany grew from 294 in 2021 to 490 by 2025. Notably, this growth happened during the pandemic, amid rising energy costs, and with the arrival of international chains, demonstrating that the city’s specialty coffee scene can adapt.

The next phase of growth requires both commercial resilience and clearer communication. Consumers who understand why coffee costs more are better equipped to make informed choices. The arrival of brands like LAP, whatever one thinks of it, has at least made the case more urgent.

Germany will remain one of the world’s most important coffee markets regardless of how these tensions resolve.

The question is what the market will look like in ten years: whether growth in whole-bean consumption signals a genuine deepening of coffee culture, or whether the convenience-and-cost model gains enough ground to reshape how cities like Berlin drink their coffee.

German coffee market FAQs

Why is whole bean coffee growing so fast in Germany?
One in three German households now owns a fully automatic coffee machine, driving demand for fresh beans. Younger consumers in particular are buying whole beans to grind at home, seeking a higher-quality experience without the cost of visiting a café.

What is LAP Coffee and why is it controversial?
LAP is a Berlin-based chain selling €2.50 cappuccinos across compact, digitised outlets. It is backed by venture capital investors, which critics argue lets it price below market cost and expand aggressively, threatening independent specialty cafés that can’t compete on price alone.

Is Germany’s coffee market actually growing?
Volume fell 1.5% in 2025, but total market value reached a record €8.98 billion. Germans are drinking slightly less coffee overall but spending considerably more per cup, driven by a shift towards premium whole bean and out-of-home consumption.

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