Busting the Trade Jargon
The British Coffee Association (BCA) regularly provides its members with industry guidance and advice, and information and ideas to help them get the best out of their business.
Coffee buying tips and terminology for roasters.
About Coffee Trading
- Arabica coffee is traded against the New York ICE futures market and Robusta is traded against Liffe London.
- Green coffee is generally packaged into between 60 and 70 kilo hessian/Jute coffee sacks, although there are certain origins and grades that are packaged in smaller volumes and in different ways, such as vacuum-packed cartons.
- There is not generally a minimum order amount, so one bag can be ordered (or multiples thereof) and collected at the customer’s convenience.
- The coffee will be stored in a BCA-approved warehouse, usually near Tilbury, Essex – the largest container port in the UK.
- Coffee is traded in £ sterling PMT – per metric tonne, although it is also offered in euros and US dollars upon request.
- VAT/Duty: green coffee is non-dutiable and therefore there is no VAT payable on green coffee.
- Immediate release/Spot: Spot is a term often used in the coffee trade. It refers to a purchase for an immediate invoice/release of coffee.
- Forward Contract: to forward contract a coffee is to form a binding contract between the buyer and seller. A coffee can be forward booked to be invoiced/released at a certain time in the future, requested by the buyer at the moment of purchase/contract. The buyer agrees to take release/delivery of their coffee within the contracted delivery time frame. The seller’s responsibility is to supply the coffee at the agreed price, within the time frame and in the best possible condition. The payment for the coffee shall be made when the coffee is called off (requested invoice/release by the buyer) and not when the contract is made.
- On a NCAI basis: ‘Net cash against invoice prior to the release of the goods’ basis.
- Release: the point when payment has been made and the release is sent to the warehouse, transferring the goods into the customer’s or nominated haulier’s name ready for collection.
- EXWHSE basis: ex-warehouse – this means that the coffee is offered free at the point of collection to the customer or their nominated carrier (the warehouse address details will be supplied with the release).
- Booking in: warehouses require a minimum of 24 hours’ notice prior to collection so that the coffee can be made ready and available prior to collection. Deliveries can also be arranged using recommended and experienced carriers.
- Pallets: coffee is generally stored on either a Euro Pallet (sometimes referred to as a 'blue pallet') which can hold a maximum of 11 x 60 kilo sacks, or a large ‘coffee’ pallet which can hold a maximum of 25 x 60 kilo sacks or 20 x 70 kilo sacks.