The future of premium coffee lies as much in nurturing the farmer as the beans they produce. Editor Susan Skelly reports from the coffee plantations of Costa Rica.
High in the San Ramon region of Costa Rica’s Central Highlands, a soufflé-fine mist is falling on Edgar Fernandez Araya’s coffee plants, making the already glossy leaves as shiny as a Kim Kardashian manicure. It’s December, harvest time, and the branches are all but bouncing with the red and yellow cherries that house the beans.
The 4.2 ha La Joya farm, 1280m above sea level, is an exemplar of a new, more considered style of farming that taps into the 21st century “sustainability” imperative. It’s the farm from Central Casting, attracting 45 species of birds, including a whole family of toucans nesting near the house. There are sweet lemon shade trees, grapefruit the size of soccer balls, blazing red poinsettias, elegant strelitzia, and cucumbers strung low along the rows of coffee bushes, mostly the high-yielding catuai variety of Arabica.
A coffee plant nursery in the Costa Rican highlands
Coffee’s heavy hitters recognised a decade ago that to shore up their supplies of premium coffee for many years to come, the farmers who produced the coffee needed to think beyond the next harvest. And they needed to engage the next generation, many of whom don’t see coffee as particularly glamorous.
In Costa Rica, for example, what was once the predominant export had, by early 2013, slipped behind medical devices, microchips and tourism. In 2011, coffee contributed less than 1 per cent to the economy compared with 40 per cent in the 1930s. The plunge in the price of coffee between 2001 and 2004 (when supply exceeded demand, partly due to the entry of Vietnam into the coffee arena), saw large numbers of coffee farmers quit. And, today, plantations are being sacrificed for development and urban sprawl.
Yet Costa Rica’s breeding programs over a century have led to high quality coffee with very high yields. The genetic stock in this Central American country is sought by countries with similar growing conditions.
The big roasters
Corporations worth their salt in the 21st century have social responsibility programs, and those buying materials from farms and forests increasingly have sustainable sourcing programs. (“Sustainability” refers to the economic, social and environmental balance required to meet the needs of current generations without compromising the ability of future generations to meet theirs.) Most coffee and chocolate producers have field programs “at origin”.
In 2013, the four big roasters – Nescafe, Mondelez/Kraft, DE Masterblend and Folger – together managed 40 per cent of the world’s coffee. Companies with notable sustainability programs include Nescafé and Mondelez/Kraft. Smaller companies include US outfits Sustainable Harvest and Caribou. Tchibo in Germany has a reputable field program, and in Australia, Gloria Jean’s Coffee (acquired by the Retail Food Group in 2014) had made a commitment to buying coffee that is certified as sustainable by the Rainforest Alliance, an NGO with a focus on natural resources, workers and wildlife, and with a significant role to play in certifying coffee crops in Costa Rica and other parts of the globe.
Coffee “cherries” that house the green beans, from a recent Costa Rican harvest
Premium green coffee crop
Nespresso, an autonomous business in the Nestle Group, implemented its AAA Sustainable Quality Program in 2003, and today embraces a hands-on involvement with coffee producers in Peru, Mexico, Costa Rica, Guatemala, Nicaragua, Columbia, Brazil, Ethiopia and India. The Swiss-based brand claims to use only the top 1-2% of the world’s green coffee crop in its “portioned coffee”. (This year, the number of dedicated outlets selling its signature recyclable aluminium capsules surpasses 400.)
Partnering with key millers such as Volcafe and Ecom, as well as the Rainforest Alliance, the Latin American business school INCAE and its research arm, the Sustainable Markets Intelligence Centre (CIMS), the AAA collaboration provides hard data, education and technological assistance for coffee farmers.
The initiative is prized, says Chris Wille, until 2014 Chief of Sustainable Agriculture with the Rainforest Alliance, for its innovation, consistency and ambition. “It is notable for the way it links crop quality to sustainability and trying to determine real farmer income; for staying with the same program and farming communities for a decade; and for striving to get enough farmers in the program so that 80 per cent of its coffee is from the AAA program and/or Rainforest Alliance certified farms.”
Roasted coffee beans sustainably farmed. Photo Richard Taylor
It is a poetic endeavour. “We want you to taste the birdsong, taste the butterflies in the coffee … ,” says Wille, adding, more bluntly, that, at the time we visited, the world was in the middle of one of the biggest biodiversity crises ever, losing 2400 ha of forest every hour and three species a day. However, he says, “Coffee is a good news story. Half of all plant and animals are in the same tropical ecosystem where coffee is grown. A coffee farm managed properly is the next best thing to natural rainforest.”
Farmers in the AAA program (in 2015 there are more than 63,000) are guaranteed a premium price for their beans, which in Costa Rica at the time of our visit was A$15 on top of the going price of A$90 for one fanegas or about 46 kilos.
Surveys of clusters in Mexico and Guatemala conducted by the International Finance Corporation (IFC), a member of the World Bank Group, between 2007 and 2010, indicated that net incomes for farms in the program were 27% higher than for farms that were not.
A gift from George Clooney
Edgar Fernandez has been farming for 25 years. He opted into the sustainability initiative a decade ago and has seen his yield improve by up to 15 per cent.
The benefits include regular soil analyses and customised fertilisers; planting to minimise soil erosion; safer, more targeted use of herbicides; better storage of chemicals; the planting of shade trees; pruning for optimal density; a “renovation” program; and instruction in accounting, record keeping and credit.
Edgar Fernandez, sustainable farming with tangible results
Fernandez’s daughter, Viviana, 23, is happy to talk about yield, but she is even keener to talk about Hollywood actor George Clooney, the high-profile ambassador of Nespresso, who paid their farm an under-the-radar visit in December 2011. They bonded over pigs, she says. The Fernandez family keeps a little house of pigs whose methane gas is piped to the kitchen to ignite the cooktop. Clooney’s pet pig Max died at age 18, in 2006. Clooney’s parting gift to the Fernandez family was a pomegranate seed that by 2013 was a 2m tall tree by the river that’s part of the farm’s “natural barrier”.
Viviana Fernandez has a confession to make. She has never tasted the coffee her family farm produces. The trademark capsules are as rare as defence forces in the politically stable Costa Rica. “I don’t like coffee,” she says, “I prefer oranges.”
Coffee and terroir
It’s fashionable these days to talk about coffee like a fine wine. Terroir, single origin, and tasting notes have become part of the lexicon of connoisseurs. There are single origin coffees, limited editions, coffee boutiques, sommelier programs, “grand crus” and “taste profiles”. And myriad designer coffee machines.
“The birth of ‘gourmet’ as a concept was a milestone in the evolution of today’s coffee drinking,” says Karsten Ranitzch, Head of Coffee at Nestlé Nespresso. “Desire grows where there is a lack. The trend for smaller shops and a new awareness of quality drove a major new trend.”
Nespresso executive Karsten Ranitzch assesses a 2012 crop
Certainly, coffee’s popularity is buoyant. According to the International Coffee Organisation, world consumption of coffee in 2014 was 149.3 million bags (a bag is 60kg) up 2.3 per cent since 2011. Demand is strong in many countries, particularly in the traditional markets of Canada, EU, Japan, Norway, Switzerland and USA, but, according to the ICO, the biggest potential is in emerging markets such as Algeria, Australia, Russia, South Korea, Turkey and Ukraine.
Related article: Karsten Ranitzch
There’s a whole lot of slurping and spitting going on in the San Antonio Room at the San Jose Marriott. Rafael Hernandez is a “cupper” with Volcafe, the largest exporter of green coffee in the country. He sucks up coffee on a round, flattish teaspoon with the force of a category 5 hurricane, conducting tastings of brews made from beans from the La Georgia, Santo Dominguez and San Diego “clusters”, identifying peach, honey, apple, jasmine, nut and plum notes, explaining the way a coffee’s body goes up as its acidity goes down. We sample coffee made from defective beans that produce coffee that has notes of soggy cardboard and bilge water. “You wouldn’t believe how often you are served that coffee!” he says.
Raking coffee beans as they dry at the Volcafe mill in central Costa Rica
Single origin coffee
There’s as much quality control in premium coffee as there is for Hermès leather or Woolmark superfine merino: physical checks for density of the bean, its colour, size and defects. Says Kenneth Waugh, managing director of Volcafe, of the selection process: “We need to buy two bags to get one of the quality we desire.”
The taste of coffee is dictated by region, altitude and the variety of coffee plant. Preliminary aromas develop in the tree, secondary aromas during the fermentation process and tertiary aromas during the roasting process.
Coffee growing regions each bring an idiosyncrasy to the flavour of coffee: from Kenya, citric notes; from Ethiopia, floral notes. From Costa Rica, manufacturers seek sweet, malty notes with a nice acidity and a good body. Brazil provides sweet, pleasant, cereal notes.
“Single origin” is a popular marketing tool these days as is the mantra for “organic”, although the latter is more complex than its feel-good tag suggests.
Says Volcafe’s Kenneth Waugh, “Organic farming of coffee is not sustainable, just as the heavy use of chemicals 15 to 16 years ago was not sustainable. To farm fully organic is to sacrifice yield, and the price you get for organic won’t compensate the farmer for the cost of producing his coffee. It’s not efficient: you end up with 30 to 35% reduction in yield. There needs to be a halfway point.”
The Ceciliano family farm in Costa Rica’s picturesque highlands
Costa Rican farmers like Tomas Gutierrez, in San Juanillo de Naranjo, and Rene Ceciliano, in La Guaria, look for alternatives to chemicals where possible: for example using pheromone traps for the cherry borer pest, shade trees to reduce unwanted funghi, and dispensing with the “bomb” backpack spray of herbicide that uses 300 litres of water per hectare in favour of a more targeted eco-weeder that uses only 10. Storage of chemicals has been improved and farm workers educated in health and safety measures.
Volatile coffee market
A few years ago, a detailed study by the not-for-profit Central American business school, INCAE, examined profits and loss statements of more than 700 farms across five countries, and found that producers of the highest quality coffee in the world had little understanding of their accounting. Ninety per cent didn’t know what their real costs were. “They thought they did,” says Professor Lawrence Pratt, strategy director at INCAE, “but what they thought they knew was not borne out by figures.”
Coffee is an extremely volatile market. Speculation by commodity traders and hedge funds plays havoc with price. The coffee price averaged 124.56 US cents per pound from 1972 until 2015, reaching an all-time high of 339.86 in April of 1977 and a record low of 42.50 in October of 2001.
Then there is nature. An outbreak of leaf rust in Central America in 2013 affected some 64 per cent of the area planted in Costa Rica alone. Total losses for the 2012/13 harvest were estimated at 74,000 bags, increasing to 190‐230,000 bags in 2013/14. The Costa Rican government submitted to its Congress a US$40m proposal to assist coffee growers.
One step closer to the cop: roasted coffee beans
“If there is one thing a farmer has no control over anywhere in the world it is price,” says Pratt. “They have to sell at whatever the market price is. But they can control their costs and their net income. The variable most correlated to making farmers better off is yield/productivity. Our studies show that farmers with decent productivity are consistently profitable over time.”
Consumers need to think beyond a marketing seal, he says. “You happily pay $1 more for a bag of coffee in the supermarket (or, in one case we learnt of in Amsterdam, $35 for an organic Fair Trade, bird-friendly coffee grown by a cooperative of indigenous women, that comes with a free Mayan doll) and you think you are making the farmer better off, and you’re not, necessarily.
“The best thing you can do is to help him be a better farmer, rather than pay a better price.”
First published in Qantas The Australian Way, June 2013
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