116. Dockworkers' Strike: Payback Time

 

Dockworkers on strike from Maine to Texas demand fairness. AP News.

Oct. 1, 2024: A strike by dockworkers at 36 ports from Maine to Texas, the first since 1977, began walking the picket lines early Tuesday morning, according to AP News. (click here)

From our perspective at Artisan Coffee Imports, the message is clear: this is payback time and the coffee industry should take note. It's a coincidence, but appropriate, that today is International Coffee Day, a day where the industry celebrates the extensive, often unseen collaboration among countless people across the globe, all working together to deliver that perfect cup each day.

Three years ago the shipping lines took advantage of a post-COVID landslide of shipping demand and raised prices to levels that were beyond gauging. (click here) Their profits tripled. They lined their pockets and those of their shareholders. They should not be at all surprised that the dockworkers who made those profits possible were watching while they worked extra-hours, with extra health-care consequences and zero and minimal pay increases or benefits. 

From AP News: Shipping companies made billions during the pandemic by charging high prices, he said. “Now we want them to pay back. They’re going to pay back,” Local ILA president Boise Butler said.

Apparently, executives in the big shipping lines and at the ports (who are the employers of the dockworkers) are aghast at the ILA labor union's demands. They've been unable to negotiate a contract and haven't even had formal negotiations since June. The ILA has made demands like:

• a 77% pay raise over the six-year life of the contract.
• a complete ban on automation.

These are just demands in the face of estimates like this one of the profits shipping lines have raked in: in 2021 alone, the maritime shipping industry doubled the profits made in the past two decades. (source) 

Making profits is not inherently a bad thing - but what you do with them is. Did the shipping lines work to ensure that dockworkers received compensation, better healthcare, better retirement benefits and did they invest in increased safety on the job? Did they think creatively about funding re-training programs for today's dockworkers so that they would be happy to allow automation?  If a worker can see themselves as the one hired to run the machines - on the docks and perhaps elsewhere, it's an easier change. We need leaders who can envision a transition with their profits - a transition that moves workers into new opportunities with jobs outside the shipping industry where they are begging for people who can manage, repair and maintain robots.  If you don't remember who is actually doing the work, they will remind you.

I hope the strike will not be long. I hope the executives will realize their distributions to shareholders needed to extend to the workforce and this is the time, since it wasn't done three years ago. 

More power to you, ILA. I hope the leaders of global, multi-national coffee roasting companies are taking notes about what happens when we forget on whose backs all those "reported earnings" are built -- or, in the case of coffee -- on whose backs those profits are grown.

"The arc of the moral universe is long, but it bends towards justice"  

Dr. Martin Luther King Jr.

115. Analysis of Rwanda Cherry Price 2024 and the "credit vs cash" issue

Feb. 19, 2024

NAEB's 2024 farmgate price was announced last week at 480 rwf/kg cherry which seems high compared to the 410 rwf/kg cherry of last year. However, when the two are adjusted for the decrease in the value of the Rwandan franc vs the dollar they are practically equal. The strain of inflation is real in its own way, though, of course.

The real, undeniable upward price pressure for Rwanda this year will come from increased competition due to the removal of the zoning policy. This is a huge relief for me and for farmers. NAEB has finally ended its experiment with this unsustainable law which was jeapordizing Rwanda's long-term future as a supplier of top-quality specialty coffee. The zoning policy, simply put, forced farmers to sell to only one washing station in the name of traceability.  

Now all washing stations will have to compete for cherry, bringing market forces to the markets in which farmers sell their cherry, which is a good thing to the extent that markets work in this agricultural sector. For those that may not know, washing stations in Rwanda have three basic ownership structures. There is private and coooperative owned, cooperative owned meaning the farmers themsevles operate it and keep the profits. Among the privates, there are Rwandan private owners and multinational private owners.

In the short term, removing the zoning policy may seem to be a disadvantage for cooperatives versus their multinationals competitors with lots of cash reserves. However, this disadvantage existed before and during the zoning policy. As recent as the 2022 season, we saw site collectors being disloyal to their employer (a cooperative board), because the coop offered them credit while those owned by multinational corporations (MNCs) offered cash. The MNCs offered the same "price", but cash instead of an IOU to be paid in three months after the season ends. In other words, the zoning policy did not correct this market imperfection.

In the forseeable future, we can see solutions to the credit vs. cash issue, which seem more likely to happen if there is no zoning policy restricting farmer choice. For one, cooperatives might do a better job communicating (or "advertising") the advantages of cooperatives for farmers and the community vs. the 'cold cash' that an MNC buyer offers. Cooperatives are there year-round, in the community, offering services like school fee loans, help for the elderly, jobs for the young, women's groups for solidarity and training, and of course, the second-payment that cooperatives try to pay their members. That second payment comes because the coop is farmer-owned and operated. They can emphasize what a difference that is compared to what an owner who lives in Switzerland is doing with the profits on a coffee sale.

A second, clearly helpful solution would be for the government of Rwanda to advocate even more for appropriate agricultural financing for cooperative and Rwandan-owned post-harvest processing organizations. Access to pre-harvest capital is an imperfect market, or said differently, an uneven playing field. MNCs have access to low-cost capital with which to buy cherry and cooperatives have high interest costs (I've heard as high as 24% when the rest of the market was at 16%) and sometimes are denied any access at all. There are high risks, of course. There are good reasons for banks to charge high interest rates and refuse to lend. But there are also innovations in financing that should be accessed on behalf of cooperatives. For example, could financing for several cooperatives in one region be bundled and offered to a lender with average risk over a longer period than what might be offered to a single entity?

On the issue of traceability, we hope that the governmenet of Rwanda continues its good efforts to enhance traceability of Rwanda's specialty coffee. Instead of regulating farmers, it would seem more feasible from the government's perspective, to regulate operators of large transport trucks. Rwanda is a small country with a limited number of paved roads. Is it possible to post enough police checks in each coffee region during peak season to make sure no one is transporting tonnes of southwestern Rusizi cherry to Rwanda's less productive eastern province? I don't know. I hope the experts in NAEB are considering their options to be sure confidence is maintained in the traceability of Rwandan coffee.

114. Improving Access to Pesticides for Women in Rwanda

Understanding the Gap In Access to Pesticide

Research published by the Africa Great Lakes Coffee Support Program found that Rwandan female household heads are less likely than male household heads to receive pesticide for their coffee crop (Gerard, Clay, Lopez, Bowman, & Rukazambuga, 2018). Pesticide is important in controlling coffee pests such as the antestia bug, which is associated with the potato taste defect (PTD) —a defect that reduces the value of coffee from Africa’s Great Lakes Region (Bigirimana, Gerard, Mota-Sanchez, & Gut, 2018).

Many roasters fear potato taste defect (PTD) in Rwandan and Burundian coffee. It's a particularly difficult defect because it cannot be screened out before export. There is no tell-tale black mark on a bean, nor can you cup a sample and be 100% sure that the rest of the bag of beans are the same (good or bad). There might be only one bean with PTD in an an entire 132 lbs jute bag, and it can look perfect!

Since detection of PTD is impossible, the industry focuses instead on prevention. That's where pesticide and integrated pest management comes in. Female headed households are about 18% of Rwanda's coffee population. If these farmers are not getting access to pesticides, they are not part of the prevention solution.

In 2015-2017, the study mentioned above was completed by a research team from Michigan State University and shed some light on why this gender difference exists.

The researchers asked female household heads two questions: 

(1) why, if all farmers are supposed to receive pesticide, are female household heads less likely than male household heads to use it? 

(2) What approaches might improve female household heads’ pesticide access and use?

CLICK HERE to read the paper. 

The study finds the following reasons for the gap between females and males receiving and using pesticide.

Reason 1: Difficulty of spraying pesticide because of heavy sprayers—women in Rwanda generally hire laborers rather than doing their own spraying.

Reason 2: Challenges in accessing pesticide from distribution centers, including not being told when pesticide is available and being given insufficient amounts of pesticide.

Additional barriers to pesticide use: cost and difficulty of hiring laborers; concern that pesticide may be dangerous for women to spray.

The researchers then recommend ways to overcome these challenges:

(1) encourage coffee washing stations to spray female household heads’ farms for them (as is done by some cooperatives); 

(2) study barriers to equitable distribution at the local level.

The findings are themselves important as guidance to agronomists and extension services, but the research is also remarkable. This study is an example of how valuable gender disaggregated data can be. The original field survey in 2015 and 2017 collected the data showing a gap exists. Step two was for another research team in 2020 to ask "why?" They designed the study and implemented additional field research to understand and share the answers.

113. A Tale of Two Trees: Moplaco Advocates for Sustainability and Resilience in Ethiopia

Nov. 8, 2023

Moplaco representatives at IWCA
reception: Axumawit, Heleanna, Aisha

At the end of October I had the amazing opportunity to spend several days over the span of two weeks with leaders and staff of Moplaco Trading in Ethiopia. It is a remarkable company run by a team of remarkable people, (which is not surprising since great employees are the foundation of any company that achieves success.) The Moplaco staff is led by Heleanna Georgalis, who is a force in specialty Ethiopian coffee, and a wise and skilled international businesswoman.

One aspect that impressed me was Moplaco's unique advocacy for sustainability and resilience via their outspoken and clearly articulated statements on "the good" and "the bad" in Ethiopia's agro-forestry realm. I had expected cheers for Ethiopia's five UNESCO biospheres and promotions extolling the virtues of forest coffee, but Moplaco by-passes all that with two clear messages I have to admit I had not heard before:

1. Eucalyptus tree farming is bad for coffee, bad for coffee farmers and therefore bad for Ethiopia.

2. False banana is a "miracle tree" that is good for coffee, good for coffee farmers and should be encouraged in coffee areas where its virtues hold true.

Eucalyptus: I first heard Heleanna, Moplaco's CEO, mention the issue of coffee farmers switching from coffee to eucalyptus tree farming in a radio interview she gave to BBC in September 2023. She said her company had created and promoted a short animated video to try to galvanize and educate coffee farmers to resist the quick cash that eucalyptus promises, only to find out that the long term brings tragic loss of soil fertility for any and all crops, including the eucalyptus trees. I found the striking and well-made video on Moplaco's instagram feed.  [Click to watch.] It got me on board.

The short and memorable video was played at the IWCA convention for the ~ 300 guests at the Skylight Hotel. I believe the reaction of most guests was the same as mine: "I didn't realize this was an issue." The next day during a small group discussion with Heleanna, she elaborated on the issue, sharing that the eucalyptus tree itself does not threaten long-term sustainabilty, it's the inability to manage a eucalyptus forest properly. Farmers are driven to over-plant by the promise of cash returns and buyers are not self-regulating their purchases.

Eucalyptus was introduced into Ethiopia around 1900 by the great Emperor Menelik II who was looking for a fast growing tree that could provide fire-wood for Addis Ababa’s fast growing population. It now infests most of the landscape of the country pushing out native species, poisoning the undergrowth, sucking up all the soil moisture and leaving the dehydrated ground exposed to the torrential rains which will then remove the top-soil and begin to dig ravines into the base clay. You can see it all over.

I got to see the eucalyptus threat with my own eyes during a short trip in the Sidamo region while driving to a coffee farm. The road went by acres of land cleared and left with eucalyptus stumps as far as the eye could see. Next to it, acre after acre of eucalyptus trees, waiting for harvest. In contrast, on the coffee farms in the mountains of Sidamo Nansebo, we walked through hills of healthy coffee trees growing organically under the shade of tall trees which have been there for hundreds of years. Coffee was also shaded by the "tree hero" - the false banana tree.

The False Banana, also known as Enset, is one of those wonders of nature where every part of it provides something the community needs. For example, I learned in grade school that eskimos use every part of a whale after it is caught. Nothing goes to waste. The same is true with the false banana, except it provides benefits during its life and "after", when it is cut down. While it grows, its roots hold together the soil and help to prevent erosion and its shade provides an ideal microclimate for coffee. 

The false banana is a close relative of the banana, but is grown and consumed only in one part of Ethiopia. It's also found in Uganda and Philippines. It's taller and fatter than a banana tree and gives no bananas (which gives rise to its English language name “the false banana”). The lucky Ethiopians who know it, use it to make porridge and bread and have a huge advantage for food security. Research suggests the crop could be grown over a much larger range in Africa. "It's got some really unusual traits that make it absolutely unique as a crop,"  said researcher Dr James Borrell, of the Royal Botanic Gardens at Kew."You plant it at any time, you harvest it at any time and it's perennial."

The banana-like fruit of the plant is inedible, but the starchy stems and roots are fermented and used to make porridge and bread, called "Kocho" which I got to see and taste during my visit to the Nansebo coffee farm. After 4 - 6 months (!) of fermentation in the ground, the hearty food is wrapped in a false banana leaf and sold to eager customers who come to the farm gate to buy. 

Why isn't the false banana tree spreading everywhere? At least part of the answer lies in culture. Kocho is seen as a “country food” even “backwards” or “primitive” by many Ethiopians. City people are inclined towards injera, the pancake like t’eff based common staple which is found across Ethiopia. T’eff is another indigenous, endemic crop, but has extremely low energy content, is labor intensive to produce and is not at all robust to droughts. Kocho on the other hand is disdained in the same way the English used to look down on potatoes as “Irish food.”

The enset plant is highly drought resistant. It is said to survive up to seven years without rain. [2] So what you have in a stand of Enset is a food bank that can last for 7 years!

But wait, there's more and it's coffee specific. Enset acts as a wet-nurse to help coffee grow. When it’s about a year old a coffee seedling is planted near the base of the Enset and it provides water to the coffee seedling. Enset is full of water and it shares with the coffee through a mycorrhizal association. In time, the coffee trees replace the false banana trees in parts of the field. Enset matures in about 3 years. 

The coffee seedling will grow for 2 years in the shade of the enset. As it approaches fruit bearing age the Enset is removed. It can be used for food and fibre, fed to animals, moved and re-planted in another place or used to make seedlings. When the stump is buried in the ground again with a healthy feeding of manure under it, it explodes into a patch up to 50 little Enset seedlings!

The false banana tree is a plant that has been in Ethiopia since pre-history. It is a plant which provides complete food security, is great for the land and coffee cultivation and gives useful products to people who know how to harvest its fruits.

"We need to diversify the plants we use globally as a species because all our eggs are in a very small basket at the moment," said Dr Borrell.

[1]https://www.bbc.com/news/science-environment-60074407

[2]https://www.permaculturenews.org/2010/11/04/enset-the-false-banana-gives-food-security-and-more/

To learn more about Heleanna Georgalis and her life story, take a listen to the Sep. 26, 2023 interview by BBC journalist Kim Chakanetsa on the BBC UK program, "The Conversation." Click here. 

112. For-Profit Solutions for Producers

 The Women In Coffee Project extended their webinar series on "Wealth for Women in Coffee" with this week's panel discussion on "For-Profit Solutions" for improving producer prosperity.

The panelists were Phyllis Johnson, founder of BD Imports, Jeanine Niyonzima-Aroian, founder of JNP Coffee and me, Ruth Ann Church, founder of Artisan Coffee Imports. The moderator, Amaris Gutierrez-Ray, is the founder of Women in Coffee Project and the lead roaster and coffee buyer at Joe Coffee in New York City.

Each of the three panelists addressed at least one specific pro-women activity that their for-profit company continues as part of the mission. 

1. Ruth Ann shared described how Artisan was started in 2009 buys and markets the women's coffee, which encourages the cooperatives to support the women and helps them have more visibility. For example, Artisan has the president of the women's group sign the contract, which many of them have never done. Having a woman in the meetings where contracts are signed between the cooperative and a buyer has important symbolism. Often, women would not be seen in such meetings. 

Ruth Ann also shared about the $.136/lb premium that Artisan pays. This is called an unconditional cash transfer (UCT) in development circles. UTCs have been proven to be effective tools for development, especially when given to women, compared to other forms of development aid such as building a school or a health clinic. The reason is that with cash, a woman has the freedom to apply the money where it's most needed. If the family most needs to buy food, she uses the money that way. If she decides it will go to school fees or a new cement floor for the home, that is also possible.

2. Jeanine shared exciting on-the-ground achievements of JNP Coffee in Burundi, (also founded in 2009) such as increasing the quality over the years to gain higher prices to such an extent that the men in the communities are asking how they can join the IWCA Burundi chapter! Many of them now participate enthusiastically and they receive the premiums and good prices from JNP also.

Jeanine also shared the impressive story of how impactful micro-savings and micro-credit programs have been. JNP helped the women start a micro-savings program when they came to her asking for financial help to build their own washing station. Four years later, they have saved the money they need themselves, and they are now the pround owners of a washing station!

3. Phyllis summarized her experiences and truly inspired everyone on the call with her comments. Phyllis started BD Imports in 1999 with importing coffee from Kenya. Since then she has imported from Burundi, Rwanda, Tanzania, Guatemala, Costa Rica, Nicaragua and now she is focused on Brazilian imports and sourcing from racial minority producers there.

Her watch-word to the group was to "keep a big tent with you." In other words, understand that it is a village of people who help us along the way in the coffee industry. No one is a singular hero or heroine. 

Phyllis wants to change the negative connotation and definition of the word "middleman" in coffee. She emphasizes to roasters that if it wasn't for the "women in the middle" there wouldn't be coffee! You just don't hear about them very often. "The work that's happening in the middle is wholesome work. It's the work we need to be doing, so women are doing it."

To bring it to a close, Amaris, the moderator, reflected what everyone was thinking after Phyllis' stirring talk: "I think I've been to coffee church!"

Hopefully, the panel gave those who listened on Oct. 2 and those who can catch the YouTube Recording, inspiration to continue pursuing for-profit solutions in coffee to benefit producers.

111. The Missing Piece in Cost of Production

 Sep. 2023 - Learning about the DIASCA Project

Rwandan coffee harvest - at what cost?

As some of the largest coffee companies in the world intensify their interest in ESG (Environment, Sustainability and Governance) goals, multi-stakeholder initiatives (MSIs) like the DIASCA project are stepping up to solve long-term issues. One of the thorniest data issues in sustainability is not just how to gather data to estimate cost of production (CoP) of coffee for a given nation, but how to replicate the same method on an annual, or other regular basis. For us at Artisan Coffee Imports, the issue of consistently repeating CoP estimates is "the missing piece" in almost every attempt to estimate CoP of coffee.

Field research is expensive.

The problem: Updating a COP estimate and replicating the estimation method on an annual, 2 year or even 5 year basis is incredibly important. The day a report comes out with an estimate of CoP, it is already aged, and soon will be so out-of-date it is barely useful. The largest cost component of CoP is labor. Labor rates are notorious for changing year to year. CoP is almost always converted from a local currency basis to USD/lb, so foreign exchange rate fluctutaion as probably the next biggest factor. In some countries, inputs like fertilizer are another large component of CoP, and as readers may know, chemical fertilizer costs have spiked up significantly over the past two years. In countnries like Rwanda where organic matter such as mulch is a major cost to farmers, costs have also risen exponentially. Five years ago a farmer could gather enough mulch in near-by fields. Nowadays, it's common for farmers to rent a truck and driver, travel to another district, pay a different farmer for the mulch and spend one or more days of their own time to make this transaction happen.

Potential Solution: The Committee on Sustainability Assessment (COSA) is the

DIASCA is a multi-stakeholder
initiative funded by GIZ.

technical workstream (TWS) leader for a new effort to develop a rapid CoP estimating method that can be adapted easily to almost all coffee-producing countries. Their efforts are one part of the larger project of the International Coffee Organization (ICO) to address living income. The larger project's acronym of DIASCA stands for Digital Integration of Agricultural Supply Chains Alliance. The purpose of DIASCA is to make digital traceability more efficient by helping all actors in the supply chain "speak the same language." To do this, COSA is proceeding with the careful and difficult work of facilitating parties in different countries and many different organizations to agree on the most important variables to measure, AND they are simultaneously testing new methods for obtaing metrics of those variables that will greatly reduce the cost of field research. 

Lars Kahnert, GIZ

Artisan Coffee Imports is proud to be participating in the roundtable discussions to develop the economic model and supporting metrics to produce a reliable and repeatable CoP estimate that will then be a key component of the DIASCA project's larger Living Income estimates. 

Indicator lists and flow-chart models are still in process! We can't share them with you today, but soon there will be early results to share. (Watch this space.) It is challenging and rewarding with colleagues from esteemed organiztions across the globe, COSA being one of them, as we work towards this important industry goal.

Daniel Mbithi, Kenya Coffee Exchange, 
gives insight on Kenya's project.

110. Dukundekawa Musasa Achieves ISO 9001 certification

Dukundekawa Musasa Achieves ISO 9001 certification

Ruth talks with Ernest

In June 2022, Ruth was visiting the cooperative Dukundekawa Musasa in the Northern Province of Rwanda. Ernest Nshimiyimana, the Managing Director, mentioned that he planned to have the cooperative’s operations certified to the ISO 9001 standard by the end of 2023. In April 2023, they accomplished this goal! They have become one of only two coffee cooperatives in Rwanda to achieve this internationally recognized quality standard. 

Nshimiyimana commented on the new achievement, "Every single day, we’re learning, creating and refining. This is one more objective proof to our staff, partners, clients and the outside world that customer satisfaction is at the core of our business. We are farmers. Buy from a farmer and enjoy the perfections."

Organizations use the ISO 9001:2015 standard to demonstrate the ability to consistently provide products and services that meet customer and regulatory requirements. It is the most popular standard in the ISO 9000 series and the only standard in the series to which organizations can certify.

Artisan is impressed by this accomplishment in the area of quality and organizational management. Up until this time, we have only heard of one other coffee producing group, Daterra Estate in Brazil, that has understood the value of quality systems and international standards well enough to pursue this challenging standard. They achieved ISO 14001, which is the international standard that provides a framework for an effective environmental management system (EMS). It provides a processes an organization can follow, rather than establishing environmental performance requirements. 

Achieving a certification, any certification, is the first and hardest step, but continuing to maintain a certification is the next difficult phase.

Dukundekawa's ISO 9001:2015 certificate - issued 13 Apr 2023

What is ISO?

ISO is the International Organization for Standardization. It is a worldwide federation of national standards bodies (ISO member bodies) based in Geneva Switzerland. It aims at developing common international standards in many areas. Its purpose is to facilitate International trade by providing a single set of standards that people would recognize and respect. It specifies the requirements for a Quality Management System (QMS) where an organization needs to demonstrate its ability to consistency and aims to enhance customer satisfaction through effective application of Quality systems.