Coffee at Cocaine Prices

Five bags of Geisha, a coffee bean from Panama, recently fetched $33,000 at an online auction—the highest price ever paid for coffee since virtual coffee auctions began in 1999. The buyer, Geoff Watts, director of coffee and green coffee purchaser for Chicago’s Intelligentsia Roasting Works, fell in love with the bean after blind-tasting it at this year’s Best of Panama competition.

Most coffee retailers pay about two bucks for a pound of raw coffee. Geisha cost Watts $51.95 a pound, and now he sells it to the public at $50.25 a half-pound (an almost 100 percent markup). CHOW talked to Watts to get the details of his big purchase.

So what’s the big deal with this coffee?

On the jury for the Best of Panama competition … we ran into this one coffee that was completely different than everything else. It had Ethiopian character: lemony floral, somewhere between lemongrass and sweet jasmine, and a little citrus. Incredibly aromatic, crazy, like there was light beaming out of it.

If it’s like Ethiopian coffee, which you can buy for two bucks a pound, why pay over $50 a pound for this one?

Well, all coffee came from Ethiopia originally, but most coffees grown throughout Central and South America now are generations removed. This Geisha varietal had been brought to Costa Rica sometime in the ‘50s or ‘60s. So you’ve got an Ethiopian-like profile, but it’s handled, processed, and picked by a farmer in Panama with all the resources. These guys are not struggling farmers. They’re very well off—they have full-time agronomists on their farms, gorgeous facilities—and so they’re able to take this coffee with all of this natural potential and process it with the utmost, highest level of technical proficiency. Most coffees, and especially most Ethiopian coffees, are produced rather crudely. ... Often there is very little access to clean water for washing; the de-pulping equipment and fermentation tanks are old and in need of repair, not especially well maintained. Sometimes the best coffees can come from extremely rudimentary production systems. But there is a big advantage to being able to control many of the smallest details.

Incredibly aromatic, crazy, like there was light beaming out of it.

Was buying this coffee similar to winning an eBay bid?

Yeah, it’s a live auction, meaning you’re bidding in real time against other people using the Internet to connect you, and you just keep bidding each other up. This one was the longest ever. [It] started at 8 a.m. and went until 6:30 p.m. We had five roasters in our buying group, and we were all sitting in Guatemala, going, “Whatever it takes, no limit.” We bid against other roasters and importers from all over the world—Europe, Japan, Australia, the U.S. ... Sometimes there are dozens of bidders; often there are “buying groups” composed of several small roasters who pool their resources and bid together. We bid in roughly eight auctions every year, all of them in Latin America.

Since most of the coffee has already flown out the door since it went on sale, what will you do when it’s gone?

We have a bit more that we’re going to [bring out], but after that, I’m gonna cry. Then I’ll go back for the Geisha at next year’s harvest, like an old friend you have to wait six months to see again. That’s the time lapse between the last bit I drink from the 2006 harvest and the 2007 crop.