Buyers Notebook: Los Delirios Nicaragua

Direct Trade , In Season , Podcast , Sourcing
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As I write this, a collection of coffee giants is stalking the halls of our Chicago Roasting Works: George Howell, Susie Spindler, Paul Songer, Darrin Daniel and members of the Alliance for Coffee Excellence Board of Directors.  The folks who bring you the Cup of Excellence are squirreled away here for a strategic planning retreat: after staging more than 100 competitions and generating over $50 million in farmer revenues from the auction of nearly 3,000 winning lots since 1999, they are taking stock and looking ahead at the next stage in the life of the organization.  As they do, it is hard to imagine a case more emblematic of the COE’s success than that of the Canales family of Nicaragua.

The ideas of lot separation and financial incentives for quality-based differentiation that drive the specialty market today were still in their infancy when the first official COE was held in Nicaragua in 2002.  That inaugural COE event provided a powerful validation of those two concepts and delivered a message that every COE in the intervening 15 years has amplified: while investment in quality may involve some risk, it also carries the possibility of significant reward.  In fact, in a market characterized by chronically volatile and often-low prices, a quality-first strategy may be the only one that makes sense for all but the most efficient and industrialized production models.

Consider the backdrop of that first COE event.  In 2001, the coffee-market free-fall hit rock bottom: futures contracts were trading at as little as 43 cents per pound.

Less than a year later, the top-scoring lot at the 2002 COE in Nicaragua fetched $11.75 per pound at auction.  (We paid $3.65/lb. for the lot that finished third that year.)

These outcomes were exciting, worthy of celebration and important landmarks on the long march toward coffee quality.  But for us at Intelligentsia, it was in 2004 when the COE in Nicaragua delivered on its real promise to challenge conventional wisdom on the issue of coffee quality and to catalyze lasting relationships rooted in mutual commitment to coffee quality.

That year the winning lot came from a farm in Esteli called Los Delirios that belongs to Daniel Canales.  It earned an average score of 91.4 and the highest price ever earned at auction in Nicaragua: $12.50 a pound.  But that wasn’t the big news out of the 2004 COE.  The big news was that the winning lot was, wait for it: certified organic.  It was the first time top honors at the COE had ever been awarded to an organic coffee.  It quieted a rising chorus of naysaying and challenged the widely held belief that organic coffee couldn’t be great.

We split that winning lot with our friends at Stumptown and have never looked back.  We are now in our 14th season of collaboration with the Canales family and still working together every year to improve quality and deliver more value to one another.  (Along the way, the Canales family has also done plenty for the planet, reinvesting again and again to expand the coffee farm by turning cow pastures into coffee forests.)

Too often, it seems auctions like the COE and countless others that it has inspired are seen by growers as lotteries and by buyers as novelties: growers looking for a one-time windfall that will erase a fistful of tough years seek buyers looking to build their quality bona fides through one-off purchases of unique coffees at sumptuous prices, with a general tendency toward the fetishization of coffee.  In Nicaragua, Intelligentsia and the Canales family have seen the COE as something a little less Tinder and a little more Match.com: a mechanism to can help growers and roasters with shared values seeking long-term relationships find each other in a marketplace that is crowded and noisy.

The most recent episode of our Buyers Notebook podcast features perspectives on Los Delirios from our Vice President of Coffee Geoff Watts, who used COE to jump-start Intelligentsia’s relationship with the Canales family back in 2004.  Since then, Daniel has passed the Los Delirios torch to his sons Milton, Norman and Donald, and Geoff has shared the green coffee buying duties for Nicaragua.  I contribute to the conversation a few thoughts of my own based on my experience this year pinch-hitting as Intelli’s green coffee buyer for Nicaragua, including a lengthy reflection on the family’s extraordinary record of environmental achievement: for more than three decades, the Canales clan has been reinvesting its coffee earnings in expanding its coffee operations, turning cow pastures into thriving agroforestry systems, as the before-and-after pictures below show.

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Listen to the Los Delirios Buyers Notebook podcast here.

Subscribe to the Intelli Sourcing Sessions podcast on iTunes or Soundcloud and never miss another Intelligentsia Buyer’s Notebook: the stories behind our coffees in the words of the buyers themselves.

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Download the 2017 Los Delirios Organic Nicaragua coffee biography here.

Purchase Los Delirios Organic Nicaragua here.

 

Posted in Direct Trade, In Season, Podcast, Sourcing