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Coffee and Tea Reports from the Front Lines

Introducing True Blue Coffee Roasters Organic Fair Trade Nicaraguan SHG Coffee

Nicaragua — Committed to supporting environmentally friendly coffee farms and raising awareness about the importance of Fair Trade, True Blue Coffee Roasters is currently featuring an Organic Fair Trade Nicaraguan SHG as their “Coffee of the Month.” SHG, which stands for Strictly High Grown, is grown at altitudes of 3,000 - 4,000 ft. “At these altitudes, the coffee matures more slowly and you don’t get the acidic bite reminiscent of lower altitude Central American coffees,” co-owner Linda Keller explained.

“Most SHG coffees are shade grown,” she continued. “Shade grown coffees are beneficial for wildlife, especially tropical birds, who use the tree tops for nesting. These qualities are important to us, as we strive to promote social and environmental responsibility.”

After years of being ravaged by civil wars and hurricanes, Nicaragua is once again producing high quality coffees. For quite a few years, the coffee production in Nicaragua suffered a serious decline in production. Through Fair Trade practices, the region is once again producing a sustainable coffee crop, and introducing some fantastic coffees to the world market.

Nicaraguan SHG coffee possesses a restrained acidity coupled with a round, full, bouillonesque body.

Ethiopia Leases Land to Indian Investor to Boost Tea

Africa — Ethiopia has leased 10,000 hectares of virgin land to an Indian investor in the hope of boosting its nascent tea growing industry, the government said recently.

Agriculture Ministry official Alemayehu Teshome said the land given to Kanan Devan Hills Plantation of Karalla enjoyed the perfect amount of sunshine and rainfall for growing tea. “The 10,000 hectares is part of 25,000 hectares of land in western Ethiopia which the government has prepared for investors to boost tea production,” he told a news conference.

Some 3,000 hectares already planted with tea in the west was producing about 6,000 tons of tea a year, he said, 70% of which was sold locally and the rest to Europe and Djibouti.

Ethiopia wants to boost tea production to diversify exports away from its major cash crop, coffee. It is Africa's top coffee grower with an estimated annual production of 320,000 tons.

Project to Grow 3,000 Ha of Coffee in Laos Kicks Off

Vietnam - The Vietnam-Laos Coffee Joint Stock Co. under the Vietnam National Coffee Corp, (Vinacafe) has launched a project to grow 3,000 ha of coffee in the Lao province of Champassak.

The project kicked off after Vinacafe and the Dak Uy Coffee Co. of Kon Tum province reached an agreement with Champassak authorities.

Under the project, in line with the 2006-2010 economic cooperation program between the Lao and Vietnamese governments, thousands of hectares of uncultivated land in Champassak province will be used to grow coffee, creating jobs for thousands of local laborers.

The Champassak administration agreed in principle to rent Vinacafe 1,000ha for growing the coffee bushes and will consider allocating another 3,000ha-5,000ha to the corporation.

The Vietnam-Laos Coffee Joint Stock Co. has so far grown over 100 ha of coffee in Champassak province.

Kenya: Six-Month Tea Output Increases

Africa — According to a report published in the The Nation (Nairobi), Tea production for the first six months of this year rose by 48% to 198 million kilos from 134 million kilos last year.

Tea Board of Kenya termed the first half production the highest in past years. “Although the 2006 production was affected by severe drought, this year's production is the highest that the tea industry has ever registered for the January - June period,” said the board's managing director Sicily Kariuki.

Kariuki said the “phenomenal performance” was due to unprecedented rainfall experienced during the first quarter of the year.

Production was higher in the tea growing areas West of the Rift than areas East of the Rift. West of the Rift, output rose by 63% from 69 million kilos to 113 million kilos. Production within the East of Rift also increased significantly by 32% from 64 million kilos to 85 million kilos. Consequently, the estate sub sector, which is predominant in the West of Rift, recorded a production increase of 65% from 44 million kilos to 72 million kilos.

The smallholder sub-sector registered an increased output of 39% from 90 million kilos to 125 million kilos and accounted for 63% of the total production.

Kona Coffee Companies Argue about Blended Coffee

United States — According to a recent report, there is a debate brewing about how much Kona coffee should be required to qualify as a “Kona blend” product.

Many smaller independent coffee farmers see the valuable Kona brand being diluted by large coffee companies, a situation exacerbated by a state law allowing blends with just 10% Kona coffee to advertise as “Kona blend.”

Many growers say that 10% is such a small proportion that the Kona coffee can't even be tasted. The 10% Kona blended products often sell for a quarter of the price of pure Kona coffee.

Some have pushed for a 75% blend. But opposition from the big coffee blenders stopped legislation this past session that would have increased the Kona coffee in blends.

US Companies Selling More Coffee With A Conscience

United States — According to a report by Susan Buchanan from the Dow Jones Newswires —The sustainable coffee business, which tries to pay growers a premium while helping the environment, has gone mainstream however—attracting companies and consumers. Industry members credit Starbucks Coffee (SBUX) with its multitude of shops, along with roasters like Green Mountain Coffee (GMCR) and Peet's Coffee & Tea (PEET), for educating drinkers about the rough times growers suffered in recent years and about different types of joe.

"Big can" or giant roasters are doing their part by expanding supermarket offerings beyond conventional java. There is also a surgance of college students who are writing papers on coffee-growing in government and economics classes became workers with incomes, waiting in line for their daily, specialty-grown cups. "Regular or decaf used to be the choice in America. But today's consumers are aware of origins like Colombian or Kenyan; of varieties--arabica or robusta; and of practices-mountain-grown, organic or fair trade," said Daniele Giovannucci, a World Bank consultant. As drinkers shell out $4 or more for gourmet brews, well over half of U.S. java sales are now specialty and sustainable products "that weren't on the radar screen 20 years ago.

Coffee is at the forefront of the "sustainable movement," which also addresses cocoa, tea, fruits and grains, and is an umbrella for assortment of growing and certification methods. Organic beans are produced without harmful chemicals, with an eye to farming as an ecosystem. Fair trade coffee, which is mainly organic, shade-grown and chemical free, ensures that growers are paid a fair wage, while encouraging biodiversity and setting a minimum consumer price. Rainforest Alliance certifies coffee plantations that conserve forests and wildlife habitat and give workers decent housing, education and health care.

In the U.S., hundreds of roasters and cafe owners sell fair trade beans, including P&G (PG), Kraft (KFT), Starbucks , Green Mountain, Peet's, and vendors McDonald's (MCD), Dunkin' Donuts, Coca-Cola (KO) and Ben & Jerry's. Equal Exchange, begun in 1986, is the oldest U.S. for-profit, fair trade firm selling organic joe.

The industry is now at a gallop, said Rick Peyser, Green Mountain Coffee spokesman, who noted that 658 McDonald's in the U.S. Northeast started selling Newman's Own Organic Blend roasted by Green Mountain in late 2005. Starbucks gets lots of credit for raising consumer interest in producers.

CAFE Practices, or environmental and social standards for growers, Starbucks bought 155 million pounds of beans in fiscal 2006, comprising 53% of its coffee purchases, said spokeswoman Stacey Krum. "Our goal is to buy 80% of our coffee from CAFE Practices suppliers by 2012."

Last year, companies globally paid 27 cents a pound more for organic than non- organic beans, and 8 to 12¢ more for Rainforest Alliance than regular beans, Giovannucci said. He noted that the price paid growers for fair trade coffee is calculated at a minimum of $1.26/lb. If the New York Board of Trade Arabica market is at $1.05/lb., then 21¢ would be added to reach the minimum fair trade price. If that coffee is also organic, then another 15¢ would be tacked on under fair trade guidelines. Sustainability Labels Protect Big Companies.

Giovannucci said "sustainable is now accepted to mean those coffees that are certified to a particular level of social, environmental, or economic sustainability, though one still hears an occasional dispute over the term." Over 90% of sustainable beans globally meet minimum standards — organic, fair trade, Rainforest Alliance, UTZ Certified or standards held by Starbucks, Nestle and other firms. These standards "assure consumers, and also assure coffee companies that want to either become more sustainable and/or manage their reputational risk," he said.

Giovannucci said corporations linked with Rainforest Alliance or fair trade have certifications and favorable public relations to fall back on if a big scandal unfolds — such as past headlines about child labor use in West African cocoa production. P&G, which mass-markets Folgers and Millstone coffee, is offering fair trade- certified and Rainforest Alliance-certified coffees as part of the company's Millstone brand, said Lars Atorf, P&G spokesman.

While certified, sustainable producers are considered good for the environment, they're not the only stewards of the Earth. "Non-certified coffee is not necessarily grown or processed under unsustainable practices," Atorf said. For example, an uncertified grower could be well paid for his beans if they're in particular demand, and some farms operate under healthy, sustainable practices without being certified.

Atorf said the certification movement has helped raise awareness about coffee production and brought with it price transparency, but work is still needed to improve the system. "With very diverse standards, further efforts are necessary.”

Tea & Coffee - September, 2007

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