Brewing Change: How Specialty Coffee and Ethical Investment Can Transform the Global Supply Chain

Coffee is the second most traded commodity in the world, with a total global market value of around USD $250 billion. Here in Australia, we drink over two billion cups of coffee a year, driven largely by independent cafés and a strong premium coffee culture. Yet despite a morning cup of coffee being a daily ritual for so many, very few of us have visibility into the lives of the people who bring bean to barista — or the practices our purchases may be supporting. Many Australians would be shocked to learn that there remain widespread issues on many plantations.

The Problem: An Unequal and Opaque System

According to the International Coffee Organization, around 80% of the world’s coffee production comes from smallholder farmers. Coffee trees require a warm, steady climate, do not tolerate frost, and need seasonal rains — making global production heavily reliant on developing countries such as Brazil, Vietnam, and Indonesia. However, inexpensive labour in these regions has led to widespread exploitation of local workers, with slavery, child labour, and animal abuse all commonplace on plantations.

Most smallholder farmers sell their unprocessed or semi-processed coffee to local middlemen or cooperatives. The prices offered by exporters are dictated by international commodity markets — shaped by speculative trading and macroeconomic forces — which often fall below the cost of production. These farmers, with little negotiating power, are forced to sell at a loss simply to survive. Sitting at the very bottom of the value chain, a good year’s return will typically earn them only 7–10% of the retail price of coffee. In places like Brazil, this figure can be as low as 2%.

The Gap: A Better Way Forward

The introduction of global certification standards such as Fairtrade and Direct Trade aimed to reduce this kind of exploitation and provide consumers with greater transparency. For example, organisations like the Fairtrade Labelling Organisation offer growers a 20-cent premium above market prices if they comply with strict environmental and social standards. Yet these certifications are often difficult to apply for, costly to achieve, and create additional operational burdens for low-income local growers. Each certification requires different standards, and may even subvert traditional local farming practices that have long centred around environmentally safe and sustainable production.

Beyond these frameworks, a growing ethically conscious consumer class has given rise to the specialty coffee movement — coffee grown, processed, and roasted to a higher standard. Consumers today care not just about taste and roast profile, but about origin, sustainability, and ethical sourcing. Increasingly, they are willing to pay a premium for coffee that aligns with their values.

Opportunity in Southeast Asia: Growth, Quality, and Impact

Currently, the specialty coffee segment is valued at approximately USD $102 billion globally and is expected to grow at a CAGR of 10.4%, reaching over $183 billion by 2030. Specialty coffee is characterised by its focus on quality, traceability, and ethical sourcing. While the market is still concentrated around Arabica beans from South America — notably Brazil, Colombia, and Peru — there is increasing recognition of the quality and diversity of beans produced in Southeast Asia.

Due to shifting climate conditions, including rising temperatures and increased rainfall variability in traditional coffee-growing regions, Southeast Asian countries are emerging as vital players in the future of specialty coffee. Vietnam (already the world’s second-largest coffee producer), Indonesia, and Laos — with their diverse microclimates and growing specialty scenes — offer fertile ground for innovation in sustainable and premium coffee production.

Coupled with Southeast Asia’s rapidly growing domestic food and beverage markets, as well as strong export demand from Australia, China, Europe, and North America, the region’s specialty coffee sector represents a high-scale investment opportunity embedded in ethical, sustainable supply chains.

Eaton Capital’s Role in Catalysing Change

Eaton Capital is supporting the shift toward more ethical supply chains by helping raise capital for a female-led Australian specialty coffee company at the forefront of innovating sustainable trade practices with smallholder farmers in Southeast Asia. Some of these practices include establishing direct relationships with farmers, offering stability through long-term contracts, and building their capacity to move up the value chain and become price setters for their crops. Many of these relationships are formed with ethnic minority and female led enterprises, contributing to a more equitable, resilient, and sustainable supply chain.

Their approach also addresses the inefficiencies of blanket certification schemes. While such programs have advanced the conversation around ethics, they often impose costly, rigid standards on low-income farmers. This supported model instead builds a bespoke, people-centred procurement framework — one that honours local sustainable farming traditions while delivering accountability and ethical oversight.

Conclusion: Brewing a More Ethical World

By targeting investible opportunities in sectors re-orienting around ethical and sustainable practices, Eaton Capital ensures that the flow of private capital is directed toward solutions with real impact. This strategy doesn’t just support businesses — it helps transform entire supply chains, delivering long-term, systems-level change.

As a consumer, your daily coffee is more than just a habit. When you choose to buy from brands that invest in their supply chains and empower farmers, you are helping to build a fairer, more ethical world — one cup at a time.