Why Is Geisha So Expensive? A Detailed Breakdown of Geisha Coffee Bean Prices! Hacienda La Esmeralda Auctions, What's the Difference with Red Label Geisha?

Understanding Geisha Coffee Pricing: What Makes It Reasonable?

Geisha coffee has been making waves in recent years, with enthusiasts driving its prices to seemingly new historical highs each year. Given this information, what exactly constitutes a reasonable price range for the Geisha coffee beans you purchase?

The Agricultural Nature of Coffee

First, FrontStreet Coffee would like to explain some basic information before elaborating further. The fundamental fact is: coffee beans are agricultural products. Items from the same plot of land don't vary significantly, and price performance often has little correlation with quality. If you were a farmer growing oranges, the same variety from the same land would naturally have some quality fluctuations due to on-year and off-year cycles, but you wouldn't find that this year's oranges are twice as good as last year's, and next year's twice as good again.

Why Geisha Commands Higher Prices

Viewing coffee beans as ordinary agricultural products, it's reasonable that Geisha is priced higher than typical coffee beans. FrontStreet Coffee shares three reasons for this. First, it's somewhat challenging to grow—that's a fact. Second, its yield per unit planting area is not high—that's also a fact. Third, because this variety hasn't been around long and hasn't been widely cultivated on a large scale, the market's demand for this novel variety is also a fact. Under the influence of these factors, Geisha variety coffee beans cost approximately 6-10 times more than ordinary coffee beans.

The Role of Hacienda La Esmeralda

Because Panama's Hacienda La Esmeralda was what made everyone recognize the Geisha variety, which then spread to surrounding estates and neighboring countries. It could be said that without Hacienda La Esmeralda, there would be no Geisha craze as we know it today.

Understanding Red Label Pricing

Take the latest harvest season's green bean prices as an example: the same Panama Hacienda La Esmeralda Red Label Geisha costs around 2200-2600 RMB domestically. Hacienda La Esmeralda currently has 3 major estates with 22 plots, and the differences between plots aren't too significant, with price differences of about 100-200 RMB between different plots. This detail also shows that the estate believes most plots perform at similar levels. This might differ significantly from the information we typically receive, as much online information reaches tens of thousands or nearly 100,000 RMB. Those prices aren't wrong, but they represent auction prices only.

Every 1 kilogram of green beans becomes approximately 0.79-0.83 kilograms of roasted beans, meaning that without calculating other costs, the cost price for about 100g of Red Label Geisha is around 280-330 RMB. Of course, besides this, there are also packaging and other allocated cost expenses, which is why we often see Red Label Geisha prices mostly in the 380-700 range online. Different merchants have their own different cost calculation methods and pricing strategies.

Clarifying Misconceptions About Red Label Pricing

What FrontStreet Coffee wants to say is that the reason everyone thinks Red Label is expensive is that they've grafted their price perception of auction Red Label onto ordinary Red Label—that is, confusing news about online auction prices with ordinary Red Label.

The latest adjusted classification for Panama Hacienda La Esmeralda Geisha is: Auction, Red Label, Green Label, which may help correct this perception. But several years ago, its classification was: Red Label (including both ordinary Red Label and auction Red Label collectively called Red Label), Green Label. Before that, the classification was: Red Label, Green Label, and Blue Label. Because Red Label wasn't subdivided or explained for a long time, the public associated auction prices with ordinary Red Label.

Understanding the Classification System

How do Red Label, Green Label, and Blue Label come from the same plot of Geisha? Several years ago, Hacienda La Esmeralda defined Blue Label as the most affordable Geisha, produced below 1500 meters altitude. As Geisha coffee beans became increasingly expensive, the affordable Blue Label disappeared in 2020. Besides Blue Label, beans with specific plot names are Red Label, while those mixing different plots together are Green Label.

In years when Blue Label classification still existed, it could be seen that Blue Label beans were relatively small, while Red Label and Green Label were both somewhat larger. There wasn't much difference in appearance between the two types, both possessing very obvious Geisha internal characteristics, with the only distinction being whether plot names were indicated. In the last two years, some changes have also occurred in the appearance of Green Label and Red Label. Red Label has maintained relatively uniform large-sized specifications, while Green Label has begun to show mixed size distinctions. Understanding this makes it easy for ordinary people to distinguish between Red Label and Green Label levels based on appearance.

Understanding Auction Geisha Pricing

The above explains why there's a misconception about Red Label's high price. Below, FrontStreet Coffee will discuss auction Geisha prices and the reasons for their continuous increase.

Whether it's BOP or COE, the purpose is to drive up coffee bean prices through auctions to encourage coffee farmers. Therefore, this original purpose is to encourage price increases, and it's normal for prices to exceed intrinsic value. Auction Red Label comes from the same plots as ordinary Red Label. Under the conditions of the same variety and land, different plots might vary by 20% or 30%. Some might ask: same variety, same land, but different processing methods or batches can result in significant differences. Yes, but it's worth noting that Hacienda La Esmeralda's processing methods are actually quite traditional, with producers using batch records to track harvest dates and processing procedures. If there are significant price differences, will there also be huge quality differences? There might be some quality differences between auction Red Label and ordinary Red Label green beans, possibly as much as double, but this isn't proportional to the premium, which might be several times or dozens of times higher.

Market Factors Driving Prices

Secondly, due to the popularity of specialty coffee, the market has also actively participated in driving up prices. If you're a buyer purchasing something, you naturally seek to lower purchase prices by increasing purchase volume. This is also why different people purchasing the same Red Label Geisha might have different prices. However, there's a small detail in auctions that actually stimulates buyers to actively raise prices significantly: auction results make the purchasers' names public, which becomes a form of promotion. When several buyers team up to bid on the same batch, sharing costs makes them more motivated to offer higher prices.

Therefore, using Hacienda La Esmeralda as a benchmark, ranked auction estate beans will be even more expensive, and this estate's other ordinary Geisha beans will also sell for higher prices. Meanwhile, unknown estates or some neighboring countries naturally remain closer to their original prices.

- END -

Important Notice :

前街咖啡 FrontStreet Coffee has moved to new addredd:

FrontStreet Coffee Address: 315,Donghua East Road,GuangZhou

Tel:020 38364473