- The volume of coffee consumed in China has jumped more than 44% in the last five years
- Demand for rare and high-quality coffees has risen, with many viewing it as a “status symbol”
- Governments and associations are taking steps to curb the circulation of counterfeit coffees in China & elsewhere
CHINA HAS been one of the coffee consumption’s most impressive growth stories in recent years.
A rising middle class and ambitious younger generation have transformed the hot beverage landscape over the last decade, with the volume of coffee consumed jumping more than 44% over the last five years alone.
Homegrown brands such as Luckin and Seesaw have exploded in popularity, while Shanghai has become the city with the highest concentration of coffee shops in the world.
However, like in Japan, affluent Chinese consumers aren’t prepared to settle for low-quality coffee. An article in The Atlantic suggests that expensive, “high-end” coffees such as Jamaica Blue Mountain and Hawaiian Kona have been used to signal a certain lifestyle and status in Mainland China – much in the same way as buying luxury, designer goods.
This might go some way to explaining an issue that has become increasingly apparent as China’s interest in coffee grows: the prevalence of counterfeit green coffee.
Faking $1,029 per pound coffee
Counterfeit coffee falls into two broad categories. The first is when inferior quality beans are marketed and sold under a different label.
The second refers to blends that have a lower percentage of high-quality beans than advertised, such as a blend supposedly with 10% Jamaican Blue Mountain but which in reality have a lot less.
While it is an issue that affects producers, roasters, and retailers across the globe, a number of industry observers are particularly concerned about the extent to which it is occurring in Mainland China.
Among them is fourth-generation coffee farmer and member of the famous Lamastus Family Estates in Panama, Wilford Lamastus Junior. His family’s farm produces the world-renowned Elida Geisha coffee, which sold for a record-breaking $1,029 per pound in 2019 and was recently featured in an episode of US television series Billions.
Wilford explains that the family was first made aware of counterfeit Geisha beans in China in 2016, and of fake Elida Geisha, in particular, a year later.
“The first time my father got to Hong Kong to meet a customer,” he recalls, “the customer gave him an Esmeralda Geisha and told him to open the bag and look at the beans. He did, and they were all broken, different sizes, and had weird-looking roast. He was shocked. The client was deliberately trying to show him that they were fakes.”
“Two years later in Shanghai, a client showed us another bag that said Elida Geisha. The beans looked more decent, but it was clear it was not a Geisha from Panama. When we tasted it, it was obvious.”
Since bursting onto the scene, Panamanian Geisha has been a particular target of counterfeit coffee; but it’s far from the only coffee affected.
Anything that fetches consistently high auction prices is at risk, including Jamaica Blue Mountain and Kopi Luwak, a coffee fermented in the stomachs of civet cats. It is estimated that up to 80% of kopi luwak sold on the global market is fake.
“People want to make money out of a famous name by using a cheaper coffee,” Wilford explains. “They want to fool the market.”
Confusion & hurt
The exact point at which the counterfeiting takes place is unclear; but the size and scale of the problem suggests it is not just an operation run by a handful of opportunists.
Most believe that the problem tends to occur at the retail stage, in particular, in tourist hotspots and on ecommerce websites. In both cases, the key is that the consumer is unlikely to see or sample the beans before they buy them, making them more vulnerable to being duped.
But counterfeit coffee does not only negatively affect the consumers who pay above the odds for an inferior product. Cheap fakes in circulation can affect price and demand for the real thing, which has knock-on effects for all players within the supply chain, including producers, traders, roasters, and retailers.
As a result, national authorities and producers have been pumping significant funds into finding ways of controlling the branding of high-value specialty beans and preventing the spread of counterfeit products.
In Jamaica, this has included the introduction of prison sentences for people found guilty of counterfeiting the coveted Blue Mountain label. In addition, organisations such as Sherwood Forest Coffee Estates are experimenting with new technology to track the beans from plant to cup.
Meanwhile, in Hawaii, producers took on 22 major retailers including Costco and Amazon who were found guilty of stocking fake Kona coffee. It ended with a lawsuit and a major pay-off for the farmers, as well as half the companies signing legally binding agreements governing the use of the Kona name.
Wilford acknowledges the size of the issue and feels as though more must be done to educate people about how to spot rare, high-quality coffees, from the way they look to their true market value. However, he says they also provide confirmation of the hard work they put into producing coffees that have become internationally sought after.
“Counterfeits can cause some confusion and hurt the reputation around quality,” he says. “But at the same time, if our coffees are being faked, it means we have a high-standard product.”