In a time of financial strain, a good cup of coffee remains a small but valued luxury for many. Pact Coffee’s head of B2B, James Fairbairn, shares how consumers’ taste for quality, along with a growing focus on ethical sourcing, is reshaping the coffee industry – and setting the stage for upcoming EU transparency regulations.

During the cost-of-living crisis, luxuries are, understandably, having to make way for necessities for most of us, but it seems that a really decent cup of coffee is an affordable treat that consumers won’t give up.

A significant amount of households have been investing in high-end espresso and bean-to-cup machines, and the fondness for great brews is reflected in the independent coffee shops replacing other stores in town centres.

This is all down to the quality of the coffee. We call this 'speciality' coffee, and it’s effectively the fine wine of the coffee world. To be classed as 'speciality,' a coffee must score at least 80 points from a possible 100 with professional tasters. This can all seem a bit academic, but the success rate of these independent coffee shops is indicative of consumers getting a taste for speciality coffee.

We've seen this extending to offices and shared workspaces, where bean-to-cup machines are regularly installed and demand is expected to grow in the coming year. Because, let’s face it, as a nation, we’ve not really completely adjusted to the new hybrid working model, and many companies have rightfully come to realise that it’s about making office work desirable, rather than just cracking the whip.

A simple and logical way to do that is by making the environment enjoyable and giving your colleagues what they might not be able to get at home: a fantastic cup of coffee that they don’t have to pay for.

It’s a benefit that’s inexpensive for businesses, but something that supplies a significant amount of workspace satisfaction – almost half (41%) of British working professionals drink three or more cups per day.

More than what’s in the cup

Another compelling trend that’s gaining momentum is the growing emphasis on sustainability for businesses. For us at Pact, the future of workplace coffee isn’t just about what’s in the cup; it’s about how we get it.

Climate change is a growing threat to the whole coffee industry, and 50% of the world’s coffee-growing land could disappear by the end of the century.

To cut a long story short, most of the world’s coffee is sold on the commodity market, like grain, gas and oil. On this market, it’s usually the traders who take the profit while farmers regularly lose money on a year’s crop, and when you need to make ends meet to provide for your family, it’s understandably tempting to deforest land to quickly grow more coffee plants. Trees are one of the greatest absorbers of carbon on the planet, and when you remove them, it exacerbates climate change.

So, we believe that the only truly ethical and sustainable way to buy coffee is to skip the commodity market and all its middlemen, and trade directly with the farmer. This approach ensures farmers receive a truly fair price (in 2023, it was 46% above the Fairtrade price on average).

It also means that a farmer can sustain their livelihood and focus on quality rather than quantity, while helping to pass the family legacy to the next generation.

Sustainable sourcing is key to this approach, as well as supporting regenerative farming practices, reforestation efforts in Brazil, the development of disease-resistant coffee varieties, a carbon-neutral roastery and the use of recyclable packaging.

Deforestation regulation

A new law is expected to take effect within the next 18 months that will call for businesses in the coffee industry to be more transparent than ever about how they operate from next year.

It’s quite controversial, because it’s going to significantly change the way that agriculture-related businesses trade, and, as a result, it looks like it might be pushed back by up to 12 months to allow them to adapt.

Find out more about the EUDR in Refreshment's latest article here.

In a nutshell, the law, EUDR, bans the exportation of products grown on deforested land. It means that all EU companies exporting coffee will need complete transparency on the journey of the bean, from farm to cup, and it’ll expose any bad actors that cut corners and ditch truly sustainable practices to make a profit.

Having worked directly with farmers for over a decade, we've always ensured transparency. Over the next 12 months, we'll help them adopt the technology needed to trade with our roasters. Others will have no choice but to do the same when this law comes into play.

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