From the Valley of the Moon to Prices Over the Moon, Panama Coffee has Come a Long Way

From the Valley of the Moon to Prices Over the Moon, Panama Coffee has Come a Long Way
Posted in: History
By Mike Ferguson
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From the Valley of the Moon to Prices Over the Moon, Panama Coffee has Come a Long Way

Such a small country, all of you will fit

beneath the shadow of our flag: perhaps

you were so pretty, to ensure I’d carry you

everywhere in my heart!

                                                                -Panamanian Poet, Ricardo Miro, 1909

 

Elida Estate Gesha Earns $1,029 Per Pound in Record-Breaking Best of Panama Auction.

-Headline, Daily Coffee News, July 18, 2019

 

 

When 200 pounds of Panama Geisha coffee sold for over $1,000 per pound at auction in 2019—shattering the previous record by hundreds of dollars—growing coffee for the purpose of export was less than 90 years old in Panama.

There are some indications that green coffee first arrived in Panama as early as 1742, but the first attempts at commercial cultivation didn’t occur until the 1780’s. Planting at low altitudes around the port city of Portobelo, these efforts failed. It would be another 100 years until coffee was planted in the highlands around the Volcano “Baru,” and commercial cultivation of Panama coffee was successful. In the 1884 edition of Coffee: From Plantation to Cup, Francis Thurber writes “Recently some 70,000 trees have been planted in the Chiriquí district, in the state of Panama, and this marks the beginning of the enterprise in that state.” The word Chiriquí has indigenous origins and means “valley of the moon.”

For decades, nearly all coffee grown in Panama was used for internal consumption and the country was better known for exporting tea and being part of the “road to market” for coffee. At the end of the 19th century over 700,000 bags of green coffee crossed the isthmus each year on the way to somewhere else from somewhere else.

Panamanians just consumed more coffee than they produced and had to import coffee to meet demand. In 1913, for example, the year the canal opened, Panama imported 2,500 bags of Mexican coffee. As an aside, that same year it was reported that “samples” shipments of Panama coffee brought high prices in New York. In 1918, Panama imported over 1,800 bags of coffee from Costa Rica. Well into the 20th century, exports remained virtually unknown, measured in the hundreds of bags.

In the book, International Trade in Coffee, published in 1926, Panama is not discussed as an exporter of coffee but as an importer of coffee from Colombian, Ecuador, Salvador and even re-exports from the United States; however, the book does note that in 1925 production in Panama was “almost sufficient for the local demand.”

Government intervention during the depression years prevented a collapse of the coffee industry but resulted in the government’s “agricultural bank” becoming Panama’s largest roaster and distributor of coffee for domestic consumption. It seems an appreciable volume of coffee was exported in the years leading up to WWII, but this activity declined after the war. Panama had a relatively strong economy at the time due to the canal so labor costs were higher than other coffee growing regions and so the country could not compete on price. But with high tariffs on imports, it still cost less for Panamanians to drink coffee grown in Panama than coffee grown elsewhere at a much lower cost of production.

The exportation of coffee bounced back with a vengeance and throughout the 1950’s Panama exported an average of 58,000 bags annually. This increased to over 75,000 bags a year in the 1960’s. Exports would peak in 1996 at 181,000 bags.  Although there have been a few spikes since then, exports have settled down around 50,000 bags for the last 10 years as producers shifted their focus from volume to quality. More than 50% of coffee production is still consumed domestically.

Although Panama was an emerging presence in the specialty coffee industry in the 1990’s, the country sprang to prominence in 2004 when a Geisha variety coffee was first introduced at the Best of Panama competition and auction, selling for what was at the time an astonishing $21 a pound. Panama Geisha has continued to set records at auction since then, surpassing $1,000 a pound in 2019 and 2020.

 

The Story of Geisha

When Geisha arrived to take its place in specialty coffee, it arrived as a mystery.

In 2004, coffee buyers from around the world came to Panama to cup and score coffee for the Best of Panama coffee competition. Some of these green buyers now rank among the who’s who  in the specialty coffee industry. In 2004 they were roasters and importers eager to differentiate their coffees from other coffees. Cupping competitions were, and still are, an opportunity for green coffee sellers and buyers to identify stellar and—more importantly for some—unique coffees to sell to their customers. Since winning competition coffees usually go to auction, the judges have a theoretical, though perhaps not practical, advantage over others, since they taste the coffees earlier than most.

Formal coffee cupping competitions designed to identify top lots of specialty within a region are common today; but, in 2004 such competitions held on a “world stage” were still new to the industry, and Panama was an early adopter of the competition/auction format as a promotional effort. The coffee sector in Panama is small compared to other Central American countries and has often demonstrated adaptability and innovation. In 1996, a few Panamanian coffee producers, acknowledging they could not compete on volume and price, formed the Specialty Coffee Association of Panama and focused on quality.

As the competition judges circled the tables, blind cupping coffee at the Best of Panama in 2004, some of them struggled to maintain their “poker face.” One of the coffees was extraordinary, even among all the excellent coffees in the competition. Judges that tasted the coffee watched judges that followed them for “tells” that others were caught off guard too. It was clear to keen observers that some judges had difficulty maintaining their competition cupping composure. This was understandable given that they were all tasting high-grown and separated Geisha for the very first time. In the parlance of the times, one coffee roaster identified the taste of Geisha as “killer.” Following the competition, the Geisha from Hacienda La Esmeralda sold for an astonishing price at auction and would continue to do so, breaking its own selling price records repeatedly for more than a decade. Geisha was not born that day, but a mystery was, and it took some time and detective work to unravel.

Seventeen years ago, Geisha was new to most people in specialty coffee, but it was far from new to botanists and plant pathologists who studied coffee berry disease and leaf rust.

Ethiopia being the birthplace of coffee, it is also, not surprisingly, the birthplace of the leaf rust fungus. Leaf rust was first discovered (or noticed or pointed out to a European and recorded as a thing) in the Lake Victoria region of Ethiopia in 1861. Six years later, it was formally identified as a plant disease in Ceylon, so when the disease virtually wiped Ceylon off the coffee map in just a few years, they knew its scientific name, though the coffee planters had already named it “Devastating Emily.”

It seems hard to imagine now, but at the time Ceylon was, along with Brazil and Indonesia, one of the top three coffee producing countries in the world. By 1900, Devastating Emily had turned Ceylon into a tea growing country and also increased tea plantings in India. Some historians think this put the final nail in coffee’s temporary coffin as a popular beverage in England because it contributed to an ongoing drop in the price of tea until it was something everyone could afford to drink.

Leaf rust visited coffee growing regions around the world but came last to Central America just 60 years ago. Plant pathologist fought it every step of the way and made headway by developing hybrids that were resistant. In both Kenya and Indonesia, one of their favorite plants for developing resistant hybrids was,  wait for it … Geisha. Unfortunately, in both countries, much of this work was lost during WWII. Although Geisha by itself demonstrates resistant tendencies, it is fickle, showing resistance to some races of rust fungus and not others. Brazil worked endlessly on Geisha hybrids after the war. In the early 50’s scientists worried leaf rust could be particularly devastating to Central America since most of its coffees were descendant from one Bourbon plant smuggled from France in the early 1700’s, and therefore lacked genetic diversity.

The race to diversify and introduce resistant types and hybrids into Central American coffee was on, with the Tropical Agricultural Research Center (CATIE) in Costa Rica serving as headquarters by creating a germplasm bank, which is today the largest collection in the world. CATIE distributed resistant-inclined seeds throughout Central America. This included Geisha.

In 1934, author of All About Coffee, William Ukers, described the wild coffee forests of Ethiopia as so dense that some of them had not even been explored. It was the wildness of these ancient coffee forests and the anticipation of genetic diversity within, perhaps, that caused the British Director of Agriculture in Kenya to collect samples just two years after the last edition of All About Coffee was published. It is said the person sent across the border to collect seeds was a British Army Captain named Richard Whalley.

One cannot follow every aside one comes upon in coffee history, and perhaps we follow more than most might, but it is hoped you will forgive us this one. The story of Geisha goes that Captain Richard Whalley was sent into southern Ethiopia (the area around Gesha) from British Kenya in 1936 to collect coffee samples and returned with Geisha (whether the subtle name change was a typo or a wish will likely remain a mystery forever). However, in 1936 Ethiopia was occupied by Italy. More accurately, Italy was “attempting” to occupy Ethiopia and tensions were high between Italy and Britain, which supported exiled Ethiopian Emperor Haile Selassie, and didn’t like Mussolini so much because he was batting his eyelashes at Hitler. The coffee gathering expedition was very likely clandestine, at least technically. Since Italy never could gain control of the remote regions, especially in the early going, Captain Whalley probably didn’t have to do much skulking about.

How, when, and if Geisha went from the hands of Captain Richard Whalley (who remained in “Colonial Administration,” mostly in Uganda, and received his OBE from Queen Elizabeth in 1953), to arrive eventually at CATIE in Costa Rica on the way to Panama in the 1960’s, is open to just enough questions to still be considered a minor mystery. What is more important, and far better recorded, is how Geisha arrived on the cupping competition table at the Best of Panama in 2004.

As fickle as Geisha is in its resistance to this or that race of leaf rust, it is even more fickle when it comes to altitude. Below 1600 meters, Geisha does not exhibit a particularly outstanding flavor profile. At the same time, it is a relatively low yielding coffee plant. For this reason, the coffee farmers of Panama gave no special attention to the gift from CATIE, perhaps because leaf rust had yet to become a significant problem in Panama in the 1960’s, when they received their seeds.

But the rust did arrive, and when it did it had a particularly damaging effect on a farm recently acquired by  Hacienda La Esmeralda … well, except for this one type of coffee plant with long leaves and a wild look, as if not yet ready to be tamed. The Peterson family, which owns Esmerelda, decided to reward the wild coffee with altitude, planting it above 1650 meters and then processing it separately from other coffees. The Geisha returned the favor by producing a flavor that caused coffee cuppers to lose their poker face at the cupping table so that everyone could tell they were tasting a straight flush.

Since 2004, other growers in Panama have heard the call of Geisha and planted the coffee at high altitude. While Geisha is certainly and fortunately no longer unique to Panama, the environment in which it is grown remains unique. One only need look at a map to realize that the shore of Panama, unlike its Central American neighbors, runs east to west along the narrowest point of the isthmus. Combined with the altitude available to coffee farmers, this provides unique circumstances for specific micro-climates not duplicated.

 

 

 

 

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