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BY KATIE - MYGREENPOD, 04 May '18
A ‘new generation of discerning consumers’ is changing the lives of coffee farmers
This article first appeared in our spring ’18 issue of MyGreenPod Magazine, The Conscious Revolution, distributed with the Guardian on 04 May 2018. Click here to subscribe to our digital edition and get each issue delivered straight to your inbox
In a first of its kind study last year, WIPO (World Intellectual Property Organization) revealed how consumer choices are reshaping the global value chain for coffee. The research identified ‘a new generation of discerning consumers’ who are interested in the story behind their coffee, and willing to pay premium prices.
The research showed that coffee farmers can triple their incomes by selling premium coffees to this so-called ‘third wave’ market segment. While the export price of conventional coffee is $1.45/lb, the price rises to $2.89/lb for beans exported to coffee shops and soars to $5.14/lb for coffee exported to baristas in independent coffee shops.
Small Batch had a front-row seat when consumer demand started to shift in the UK. The independent artisan coffee company opened its first shop in Hove’s Goldstone Villas in 2009, and now has nine locations across Brighton, including the Small Batch Roastery (with Espresso Bar) in Portslade.
The founders – both ardent coffee fans – have developed long-term producer relationships to guarantee top quality for customers and good prices for their coffee suppliers, who are paid significantly more than the Fairtrade minimum.
Small Batch sources coffee beans from over 20 countries across four continents; just as the flavours vary between countries and continents, so too do the challenges and circumstances of the coffee farmers. ‘We’ve spent the last 10 years refining our sourcing policy and have realised there isn’t one system that works everywhere’, says Alan Tomlins, co-founder and managing director of Small Batch Coffee & Roasters. ‘What’s best in Colombia is not what works best in Rwanda or Guatemala.’
This is one of the key reasons Alan makes frequent visits to producers; ‘only by spending time in a country do you realise how the coffee market works there and what the most sustainable and ethical approach is for that individual country or region’, he tells us. ‘Likewise, the only way to forge meaningful and truly sustainable relationships is to spend substantial time with the awesome people who produce the coffees we buy.’
Brighton and Sussex Medical School is the global hub for research on podoconiosis (or ‘podo’), a little-known but widespread and treatable tropical disease that affects people around the world, particularly in Ethiopia.
Small Batch has helped to raise money for the Preventing Podo campaign, which was launched to turn the medical school’s ground-breaking research into practical action to improve the lives of some of the world’s poorest and most disadvantaged people.
‘Ethiopia is a really important origin for Small Batch and we have been buying awesome coffee there for years’, Alan said. ‘It just made sense for us to support this great cause.’
In Pitalito, a small town in the southern state of Huila, a new network – Red Association – has united small coffee producers in Pitalito with local exporter Invercafe, Raw Material and roasters including Small Batch.
The association was created after Raw Material and Invercafe met with 660 farming families in the region to discuss the difficulties they face. The biggest problems raised were a lack of infrastructure and stable pricing to provide certainty for investment in improving quality.
Unless coffee farmers have an ongoing relationship with a speciality buyer, coffee pricing is tied to the global coffee commodity (or ‘c’) market. The farmer’s cost of production is relatively fixed year to year, but coffee pricing is neither consistent nor reliable. It’s therefore hard for producers to invest in infrastructure to improve the quality and value of their coffee, creating a cycle of little to no profit and no long-term security.
The main goal of Red Association is for roasters like Small Batch to commit to buying a predictable volume of coffee based on a fixed price. The Red Association model was introduced at a fixed price of 1 million Colombian pesos per carga (125kg) of parchment coffee. This price – and the producer’s profit – will increase over time as the cost of production rises, based on inflation and improvements in quality. With this kind of commitment and reliable pricing the producers have a good reason to invest in quality.
The association is also helping to build infrastructure – specifically drying and quality control facilities. Climate change has made the region around Pitalito a lot rainier during harvest time, so coffee can no longer be dried on open patios and instead requires invernadoras (covered drying structures).
These aren’t cheap, so a central facility is being built to allow the association to dry all its coffee. This means the coffee will be dried much more consistently (improving the quality and longevity of the coffee), and also that the association will buy wet parchment coffee to dry in the new facility. Paying producers earlier in the production chain and taking control of the coffee earlier again reduces the producer’s risk of losing the coffee or it losing value, providing a much quicker return.
The association will also build a QC and cupping lab in the area where Small Batch will be able to assess the quality of every coffee delivered. As quality improves, Small Batch will select and buy premium single-producer microlots at a higher price. This will provide a clear incentive for other members to focus on quality.
The lab will also be used to train producers and their families in cupping and quality control. Unsurprisingly, this is one of the quickest routes to improving coffee quality, yet the chance for farmers to cup their own coffees and be trained in how to asses them is very rare in coffee-producing regions.
These initiatives are being funded by the first lot of coffee the association produced, which was bought by Small Batch and five other roasters for 1 million pesos – ‘a bit more than it was worth’.