all Eyes
on Trade

How We Buy and Sell Coffee

Inside NKG MAG Issue #45

WELCOME Everyone!

Q: What is the difference between sourcing, trading, and logistics in the coffee business?

Sourcing is about where and how coffee is bought. It includes selecting origins, farms or cooperatives, quality requirements, sustainability standards, and building long-term relationships with producers.Trading focuses on the commercial transaction. This includes price negotiation, contracts, risk management, currency and price hedging, and deciding when and how much coffee to buy or sell.Logistics covers the physical movement of coffee. This includes transport from farm to mill, warehousing, shipping, documentation, customs clearance, and delivery to the roaster or customer.In simple terms: sourcing decides what to buy, trading decides under which terms, logistics makes sure it gets there.

Q: What happens if a shipment is delayed?

A delay can cause:Production issues for roasters (running out of stock)Higher costs (storage, demurrage, spot market purchases)Quality risks if coffee sits too long in hot or humid conditionsContractual consequences, such as renegotiations or penaltiesDelays are often managed through safety stocks, alternative origins, or flexible contracts.

Exciting news for all MAG fans: our new issue takes you to the heart of our business – trade!

We continue our MAG series along the coffee supply chain with Part 2: All Eyes on Trade – How We Buy and Sell Coffee. We dive into what happens how and when the coffee is traded and take a closer look at how we manage it along the way, from pricing and contracts to the many decisions made every day in a constantly changing market.

We are very happy to offer you all articles as audio versions again! So, whether you are on the road, at your desk or simply prefer listening, you can explore the stories in the way that suits you best.

Have a look behind the scenes of trade, follow the different perspectives and maybe see trade from a slightly different perspective after reading some of the articles.

Enjoy reading (or listening)!

Warm regards,
Your Group Communications Team

In the spotlight

All Eyes on Trade:
How We Buy and Sell Coffee

Further coffee knowledge

Can I ask this?
Explore frequently (un)asked questions you never dared to ask.

Looking for a deep dive?
Browse through further materials to learn more about the coffee and its journey.

Interview with
Lai Chau

Interview with
Marten Sievers

Interview with
Linda Lin

From NKG Integrity Champion to NKG O.S.C.A.R.: Hiro Panji Lesmana

Trade is at the heart of what we do at NKG. Every day, coffee is bought, sold, shipped, financed, and enjoyed across the globe. Behind each of these steps is a network of partners and processes that need to work not only efficiently, but responsibly. That’s where Compliance plays a vital role and where this issue’s O.S.C.A.R. award winner truly shines.

NKG Holding “who is who”: Risk Control Unit

Neumann Gruppe in Hamburg is composed of departments with a broad range of functions and expertise. These departments not only support NKG’s overall strategic direction but also offer tailored assistance to the group’s companies. In our INSIDE NKG MAG, we aim to examine what unique capabilities are present within the holding company, who might benefit from them, who holds responsibility for various tasks, and much more. In this issue, we shine the spotlight on the Risk Control Unit (RCU).

Virtual Tour: Bernhard Rothfos and InterAmerican Coffee in Hamburg

Mail from Group Comms: A personal Update

Give Diverse Voices a Stage: Women in Trade

Experience, Change, and the Future: Paul Steinvorth on a coffee chat with Emilio Rolando Medina Sagastume

At a Glance

Coffee on the Move:
Facts in a Nutshell

From lush plantations to your morning cup, coffee has a fascinating journey. Explore surprising facts, global production trends, and the secrets of Arabica and Robusta—all presented in a clear, visual way. Your ultimate coffee knowledge hub starts here!

OUT OF THE BOX

Three by Three Questions: The many steps and challenges behind a single coffee trade

While “a coffee trade” may sound straightforward, it actually involves complex processes, numerous participants, and unique challenges. In this episode of our ‘Three Times Three Questions’ series, we interview key professionals from the import, logistics, and export sectors. Through their insights and real-life stories, we uncover how their contributions keep the coffee business running smoothly and highlight examples of overcoming obstacles through collaboration and teamwork.

IT'S YOUR TURN!

QUIZ: Trade & Transport Challenge

In keeping with the MAG theme, we present the ‘Trade & Transport Challenge’. Do you know the most important wordings and definitions? The quiz probably won’t be much of a challenge for our trade professionals, but it’s still nice to get full marks, isn’t it?

Among all those who participate, we’ll give away a tailormade NKG phone case, especially designed for you and your phone!

Coffee Questions You Never Dared to Ask!
INSIDE NKG MAG Frequently (Un)asked Questions

We all work for a company that deals exclusively with coffee. But let’s be honest – we sometimes still have questions about our favorite product, and maybe we kind of missed the moment in the beginning to ask them. After all, we work for a COFFEE COMPANY, and nobody wants to admit gaps in their knowledge. 😉 But don’t worry, that’s what we’re here for, because we’ve compiled a list of questions you might never ask.

What is the difference between sourcing, trading, and logistics in the coffee business?

Sourcing is about where and how coffee is bought. It includes selecting origins, farms or cooperatives, quality requirements, sustainability standards, and building long-term relationships with producers.
Trading focuses on the commercial transaction. This includes price negotiation, contracts, risk management, currency and price hedging, and deciding when and how much coffee to buy or sell.
Logistics covers the physical movement of coffee. This includes transport from farm to mill, warehousing, shipping, documentation, customs clearance, and delivery to the roaster or customer.

In simple terms: sourcing decides what to buy, trading decides under which terms, logistics makes sure it gets there.

How long does it take for coffee to travel from its origin to destination?

From harvest to final destination, coffee typically takes 2 to 6 months, depending on:

Processing time at origin (drying, milling, grading)
Availability of containers and vessels
Shipping route and distance
Customs clearance and warehousing
For example, coffee from Latin America to Europe may take around 6–10 weeks by sea, while African origins can take slightly longer.

What are the three main factors that influence coffee prices?

Supply and demand – global production levels versus consumption.
Weather and climate – frost, drought, or excessive rain can sharply reduce supply.
Financial markets and currency movements – coffee is traded globally in USD, so exchange rates and speculative trading strongly affect prices.

Why do harvest seasons play such an important role in the coffee trade?

Coffee is an agricultural product with one main harvest per year in most origins. Harvest timing affects:

Coffee availability
Freshness and quality
Price volatility
Outside the harvest season, supply tightens and prices can rise, while immediately after harvest there is usually more availability and better quality.

What happens if a shipment is delayed?

A delay can cause:

Production issues for roasters (running out of stock)
Higher costs (storage, demurrage, spot market purchases)
Quality risks if coffee sits too long in hot or humid conditions
Contractual consequences, such as renegotiations or penalties
Delays are often managed through safety stocks, alternative origins, or flexible contracts.

How do sustainability requirements shape coffee purchasing decisions?

Sustainability requirements influence:
Which origins or suppliers are chosen
Minimum prices or premiums paid
Long-term sourcing commitments
Traceability and documentation practices
Buyers increasingly prefer coffee that meets environmental, social, and ethical standards to reduce risk, improve supply security, and meet consumer and regulatory expectations.

How do politics and political developments affect the coffee supply chain?

Politics affect the coffee supply chain through:

Trade policies, tariffs, and sanctions
Labor laws and minimum wage regulations
Infrastructure investment or decline
Political instability or conflict
Changes in government or policy can disrupt exports, restrict access to finance, or affect production costs.

Why do we source more coffee from some origins than from others?

This depends on:

Climate suitability and production volume
Consistency of quality
Infrastructure and export reliability
Cost structure and logistics
Established trade relationships
Countries like Brazil or Vietnam produce large volumes reliably, while others focus more on specialty or niche markets.

Is there a difference between fair coffee trade and sustainable coffee trade?

Yes, there is a difference, though they overlap:
Fair trade focuses mainly on social and economic fairness, such as minimum prices, premiums, and better working conditions for farmers.
Sustainable coffee trade is broader and includes environmental protection, social responsibility, and economic viability across the entire supply chain.

Fair trade is one tool within the wider concept of sustainability.

Additional coffee knowledge

We’ve collected a selection of resources to deepen your understanding of coffee trade. Explore these materials to discover how trading works in practice, what shapes global coffee prices and what it takes to manage coffee along its journey from export to import: