NYC ‘C’ market basics and differentials
An introduction to the NYC ‘C’ market, the global benchmark for arabica coffee pricing, and how differentials affect final prices paid for specific origins and qualities.
- Coffee Basics Nerds
- 2 min read
Article 1 of 12 in Economics & Coffee Markets/
What is the NYC ‘C’ Market?
- The New York Coffee Exchange (ICE Futures U.S.) sets the ‘C’ price for arabica coffee.
- The ‘C’ market price is quoted in cents per pound, representing the value of a standard, exchange-grade washed arabica.
- It acts as the reference baseline for most arabica contracts worldwide.
Key Features
- Contract Size: Each futures contract = 37,500 pounds (~250 bags of 60 kg).
- Standard Quality: Exchange-grade washed arabica from approved origins.
- Price Fluctuation: Driven by supply, demand, weather, politics, and speculation.
Differentials
- Differentials = the premium or discount applied to the ‘C’ price for specific coffees.
- Determined by:
- Origin: Ethiopia or Kenya may carry high premiums for unique profiles.
- Quality: Higher cupping scores or microlots = stronger positive differentials.
- Logistics: Ease of access, shipping costs, risk factors.
- Market Dynamics: Surplus → negative differentials; scarcity → premiums.
Example Calculation
- ‘C’ Market = 180 c/lb.
- Colombia washed milds differential = +20 c/lb.
- Contract Price = 180 + 20 = 200 c/lb.
- Honduras commercial grade differential = –10 c/lb → final = 170 c/lb.
Implications for Buyers & Producers
- Roasters watch both ‘C’ and differentials when budgeting.
- Producers are impacted by volatility—low ‘C’ prices can fall below cost of production.
- Specialty trade often negotiates fixed prices or minimums to avoid volatility.
Summary
The NYC ‘C’ market sets the global arabica benchmark, while differentials adjust for origin, quality, and logistics. Together, they determine most contract prices, shaping how producers, traders, and roasters engage in the coffee supply chain.