My Round: You know what grapes went into your wine ÿ so why not the beans that went into your morning brew?

The best coffee news of the year came last month. Commodity prices are still stuck stubbornly at an all-time low, but at a single auction conducted on the Internet, two Nicaraguan growers' crops fetched a world-record price of $11.75/lb (£7.65/lb). That compares with a current market price of around 30p/lb. The coffees, San Isidro and El Regreso, had never been heard of before. So highly prized were they on the local market that the producers, Arturo Gonzalez and Eliseo Lumbi, were offered just 14p/lb earlier in the year.

The amazing auction took place as part of the Cup of Excellence competition, which has been going for a few years in Brazil and Guatemala but had its first outing in Nicaragua just last month. CoE, which I've written about before, aims to give coffee growers an incentive to keep their farms working to high standards. Entry is on the basis of blind tasting, and entrants can expect their coffee to sell at high prices. Even the losers in the Nicaraguan auction saw their beans sell for prices from 80p to £2.60/lb. As Giles Hilton, coffee buyer for Whittard, puts it: "When one grower succeeds in the CoE auctions, his neighbours think that they can do it too, and standards rise as a result."

The contrast with conditions in the commodity market couldn't be more stark. Gonzalez and Lumbi had to struggle to get a £450 loan so they could harvest their crop. They took their 2,400lb of beans to market in an ox cart. Entered into the CoE, it scored 97.19 out of 100 in blind tastings. Selling on the internal market would not even have recouped the cost of their loan. Stephen Hurst of Mercanta, the Sunbury-based coffee-shipper who won the bidding on behalf of a consortium, commented at the time: "If ever evidence were needed that the commodity coffee business is dysfunctional, it was proven last night."

CoE is trying, in effect, to detach superior coffee from the world commodity market. To understand this, imagine that the beans are grapes. The cheapest bulk grapes are used to make locally-consumed vin de table (or vinegar); the best go into wine that sells for £100 a bottle. These differences have long been recognised in wine. There are many high-priced wines from small growers who started off selling their grapes for blending, only to discover that it could be vinified separately and sold for fancy prices.

That level of discernment is still rare in coffee. It's a dead cert that many tonnes of premium-quality beans are still being sold off cheaply for use in large commercial blends. If the CoE and other initiatives succeed, those beans will be as highly prized as Château Pétrus or Ridge Montebello.

Those record-breaking Nicaraguans will eventually be going into the Monmouth Coffee Company of London; I will keep you posted. In the meantime, other signs of progress keep popping up even in unlikely places. Caffé Nero has a new venture with Mercanta to sell two premium coffees (whole beans) under the joint label "Direct From Producer". One is Costa Rican, Coopronaranjo Fine Cup Peaberries (peaberries being coffee that forms as a single seed inside the hull rather than splitting in two). The other is Brazilian, Bourbon Estate Cachoeira. Both were purchased at a good premium over prevailing market rates.

Even the dreaded Starbucks has got on the bandwagon with ethically traded coffees: its newest, Organic Shade Grown Mexico coffee, has the company's characteristic dark roast but with good body and smoothness. And best of the bunch is Whittard's exclusive Dalat Hill Station, from an old plantation in Vietnam which Giles Hilton is supporting almost single-handedly by paying a good price for its Sumatran-style sumptuousness. This is the future of coffee. Don't expect to get it by paying peanuts. *