In recent years, it’s more and more common to see buyers pay staggering prices at coffee auctions – especially for Panamanian Gesha. Often considered the darling of specialty coffee, this variety has exceptional quality potential when grown at high altitudes, and is known for its delicate and complex flavour profiles.

On 29 & 30 August, the 2023 Best of Panama (BoP) auction – which primarily focuses on Gesha – took place online. A total of 6,081 bids were placed on 50 different lots, with an average price of US $868.22/kg of coffee.

The biggest bid, however, was US $10,005/kg for a washed Gesha from multi-award winning Carmen Estate Coffee. This coffee also received the highest score of 96.5 points. To say this is an eye-watering price is something of an understatement. But more impressively so, it’s not even the highest price ever paid at a coffee auction.

Ultimately, the 2023 BoP results lead us to ask some increasingly pressing questions: why are specialty coffee roasters willing to spend so much money on Gesha? And what is the impact on the wider sector? Read on to find out more.

You may also like our article on whether coffee shops should charge US $150 for a cup of coffee.

Looking at record coffee auction prices

Although specialty coffee auctions are inherently exclusive, they still serve an important role in the industry. But arguably one of the most influential and attention-grabbing is the annual Best of Panama auction.

Organised by the Specialty Coffee Association of Panama, BoP serves as a platform for local producers to showcase their best coffees. In the context of Panama, these are some of the most sought after lots in the world.

We can clearly see this from the high prices paid for such small quantities of coffee. At the 2023 auction, 1,250kg of coffee received an astounding total of US $1,085,275. This set a new record for the Best of Panama auction. In comparison, at the 2022 BoP event, 5,000lbs of coffee (or 2,268kg) generated a total revenue of US $1,058,581.

In a press release, BoP organiser Sensible Coffee stated the highest-scoring coffee at the 2023 auction – 25kg of a washed Gesha from Carmen Estate Coffee – broke the BoP record for the most expensive lot.

“With cupping notes of… jasmine, sweet orange, lemongrass, and sugarcane, this [coffee] has now broken the record for the most expensive lot in the Best of Panama competition, with a total value of US $250,125,” the company said.

Previous world record Gesha prices

The top bid of US $10,005 at the 2023 Best of Panama is astonishing. But over the years, we have seen buyers pay increasingly more for Gesha at a number of auctions:

• In 2004, Hacienda La Esmerelda sold one of its Geshas for US $21/lb at the BoP auction that year. At the time, this was a world record for the highest price ever paid for a coffee
• Panama’s Ninety Plus sold an undisclosed micro lot for US $10,000/kg (or US $4,535/lb) at its own auction in 2019
• At the 2022 Lamastus Family Estates auction, a honey processed Gesha produced by Elida Estate sold for an unbelievable US $6,034/lb. This equates to more than US $12,068/kg – by far the most expensive coffee in the world

Do these prices add any value to specialty coffee?

With no price regulations in place, it seems there’s no limit to how much some buyers are willing to spend on Panamanian Gesha. Beyond the variety’s floral-heavy flavour profiles and notable presence at the World Barista and Brewers Cup Championships, Gesha generally yields small quantities of coffee. This only adds to its exclusivity.

Nicolas Pastellopoulos is the Head of Coffee at Sensible Coffee.

“Buyers are eager to invest significant sums in auctions like the Best of Panama as they seek unique and exceptional coffees with distinct flavour profiles,” he says. “These rare lots often represent the pinnacle of coffee quality, allowing buyers to offer their customers extraordinary tasting experiences and differentiate themselves in a competitive market.”

At the same time, however, it’s also important to point out that only a small group of companies are bidding such high prices at these auctions. 

For example, various buyers from New Zealand, Japan, China, the UK, France, and the United Arab Emirates purchased coffee from the 25kg washed Carmen Estate Gesha lot at the 2023 BoP auction. Some of these roasters are often present at high-end coffee auctions – and are usually the ones placing the highest bids.

Moreover, it’s not uncommon for East Asian coffee buyers to pay record-breaking prices at auctions. Premiumisation plays a key role in driving brand appeal in this market – and therefore consumer prices.

Is there justification for these prices?

A representative from CoffeeTech NZ – which purchased some of the Carmen Estate Gesha – says high bids are sometimes necessary.

“We think this is a fair price for the farmers,” they say. “If we compare prices paid for premium whisky or wine, the coffee sector still has a long way to go.

“Growing this coffee isn’t easy or something that can happen overnight,” they add. “We think the high price rewards producers’ hard work and encourages other farmers – even from other origins – to improve coffee quality.

“Generating more interest in these coffees drives more people to want to try them,” they continue. “And with more buyers placing bids on these coffees, it means we can pay less money on smaller quantities.”

However, we also need to consider the range of prices paid at auctions. At this year’s Best of Panama event, across the Natural Gesha, Washed Gesha, and Varietals categories, bids ranged from US $90/kg to US $3,048/kg (not including the top price of US $10,0005/kg).

Although US $90/kg is generally higher than the average price paid at many Cup of Excellence auctions, it remains clear that record-breaking top bids are not representative of the wider specialty coffee market. In fact, the vast majority of roasters couldn’t afford to pay these prices in the first place – and probably wouldn’t want to even if they could.

How are coffee auctions changing?

Originally designed as platforms for producers to showcase their best coffees and be rewarded for their hard work, coffee auctions have certainly changed over the past decade. Most notably, the growth of private auctions has shifted more focus on attracting the world’s top green coffee buyers.

Top-scoring coffees at auctions are certainly a useful marketing tool for high-end specialty coffee roasters. The most recent example was Australian and US roaster Proud Mary Coffee, which sold a natural processed Panamanian Gesha for US $150 per cup earlier this year. To add to its already high level of exclusivity, only 22 cups of the coffee were available between the roaster’s US locations.

However, only a very small number of consumers are willing to pay such a high price for one cup of coffee – and understandably so. These coffees are not marketed or branded as “everyday” coffees. Instead, they are exciting and intriguing selling points for more established producers and roasters. In turn, they still serve an important purpose in the specialty coffee sector.

For many coffee professionals and enthusiasts alike, paying over US $10,000 per kg of Gesha is unfathomable. And whether or not these coffees are worth this amount of money is a matter of opinion – and people will certainly have strong feelings one way or the other.

However, it’s clear that these ultra-high quality lots do have an important part to play in specialty coffee. Auctions like Best of Panama will continue to impact coffee competitions and more premium markets. Ultimately, this will influence the future of the industry.

Enjoyed this? Then read our article on how El Salvador can leverage Pacamara like Panama did with Gesha.

Photo credits: Sensible Coffee, Specialty Coffee Association of Panama

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