Demystifying the value chain

Bridging the gap between grower and roaster

As demand for transparently traded green coffee increases, algrano have developed a producer-led initiative that empowers growers to reach specialty coffee roasters more effectively through its award-winning platform.

The new ‘Spot Europe’ feature means that producers can now ship their coffee to Bremen before selling to specialty coffee markets. It guarantees significantly lower waiting times for coffee samples, nano lots, micro lots and larger orders to be delivered directly to the roastery door.

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Co-founder of algrano, Gilles Brunner, explains that the new initiative was developed in response to producer-need: “Growers told us that they want to be closer to the roaster by having their coffee warehoused in Europe”, he comments. “Our mission is always to bridge the gap between growers and roasters so the ‘Spot Europe’ tool is another step towards fulfilling our goal. It is a great opportunity for growers to take control of developing their own brand, while having much greater visibility in specialty coffee markets”.

Markus Fischer of Finca La Bastilla is a single estate coffee grower based in Nicaragua who is one of the first producers to take advantage of the ‘Spot Europe’ mechanism: “There are several advantages for us as growers. Not only do we have direct contact with the final buyer or roaster but it gives us the opportunity to offer specific qualities in small lots, allowing for total transparency in the supply chain,” he says.

Currently, Finca Las Bastilla produces around 250 specialty micro-lots in parchment or green bean each year. Situated between 1100 – 1450m in Jinotega, the 165-hectare coffee estate benefits from microclimates that contribute to the diversity in cup profile of the coffees grown across the region. Varietals such as Red and Yellow Catuai, Caturra, Catimor, Geisha are all cultivated alongside other hybrids as part of a recent varietal trial programme.

He adds that they have the facility to fully wash, honey process or naturally sun-dry their coffee. A dry mill on the farm also gives them full control in preparing the coffee for specialty markets before it leaves the farm gate for the port, and finally shipped to the warehouse in Bremen.

Markus highlights why having his coffee physically based closer to his customers will help him to realize to his aspirations as a producer: “Roasters will benefit due to the immediate availability of our coffee. This will allow for an intense exchange of information and opinion on quality, production, and other feedback from buyers – which is crucial to us. We are aware of the risks of having coffee consigned to a single destination port but this is important for the expansion of our customer base. For roasters interested in a continuous and dependable supply of a coffee they like, even in small deliveries, this new way of doing business should be interesting. We hope that the algrano platform will change our business from a simple commodity to a branded product for La Bastilla”.

Once the container of microlots from Nicaragua arrives in Bremen this September, algrano plan to roll out the ‘Spot Europe’ feature to other coffee producing countries so that fresh crop from Honduras and Peru will soon be available for roasters to request samples later this year.

Find the spot offer from La Bastilla here. 

This article was commissioned by algrano for the blog series Demystifying the Coffee Value Chain

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Coffee, Demystifying the value chain

Technology-driven transparency at the mill

Nicaragua is a highly-regarded coffee producing country that enjoys huge farming potential and has recently undergone a step change in the mechanization of its agricultural sector. Already, the results of this public and private investment has helped to increase quality, while at the same time reducing the cost of production of its highly sought-after specialty coffee.

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Aided by the advance of technology, one area that has seen a revolution in its production potential is the dry milling process. At this critical juncture in the value chain is the final stage of the preparation of parchment green coffee before it is sorted, graded, bagged to preserve freshness and exported. One such dry mill with a difference is using technology to push the boundaries of this highly mechanised process to increase quality and traceability.
Leinad Jesus Nazco Gonzales, General Manager of Benefico La Providencia, is responsible for its high-tech milling operation in the Matagalpa region of Nicaragua. After the coffee is de-pulped at the farm, the facility accepts the pergamino, with the coffee seed still in it’s protective layer, and will complete the sun-drying process if required by the customer.
PRODUCER FACING
“At La Providencia, it’s a very customized because we are producer-facing”, he says, “we listen to them, we always try to give the client the good service that they deserve.” From human resources, systems and quality control, budgeting and customer relations, the 35 year-old computer systems engineer supervises all aspects of the milling operation.
“The last crop we received was through a new client who did not have the capacity to process all the coffee they had. We increased our volume by almost three times. Because they needed the service we rented a coffee mill in another location so I am now in charge of two mills”.
Even with this increased demand for processing and milling for export, one of Leinad’s key responsibilities is to maintain quality and transparency throughout each stage of the process. To achieve this, La Providencia have a dedicated Q-grader in the coffee lab who identifies and classifies each sample provided by the producer for quality.
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Once they receive the pergamino, the sun-drying process is started immediately on vast patio which can last more than a week until the parchment moisture content reaches a target value of between 12-13 percent. Anything higher and he runs the catastrophic risk of mold spreading in the warehouse while further drying will affect the stability of the coffee. Each lot is then tested and separated out into different grades of quality.
PROCESSING AND DRY MILLING
Leinad says: “In our warehouse we have strict controls in order not to blend different lot qualities so that we can guarantee the integrity of the lot for the grower. Then we only mill the coffee when our farmers ask for it. Once we receive the order, we take samples to give the buyer the quality they require. The same lot could have so many different qualities and range of defects. That is why we take samples every 30 minutes when we are processing the coffee so that we can take action to guarantee that the defects are in range. When the whole lot is processed we cup another sample just to guarantee that it is correct for the buyer – we call this ‘liberacion del lote”.
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Each mill has the capacity to process nearly one quarter of a million tons of parchment to produce 4000 tons of green beans each harvest . Yet behind the astonishing high volumes involved, it is cutting-edge technology that now does a lot of the heavy lifting when it comes to hulling the coffee. Once the parchment is removed by sophisticated hullers that gently abrade the coffee, the green coffee is sorted by size, density and colour to remove the vast majority of foreign matter, chipped, broken or defective seeds.
The colour sorter uses highly sensitive cameras to analyse each individual bean as it passes through the machine at speed and rejects any bean that is outside a predetermined colour range. Before, this process was done by the keen skill of the human eye and hand. To put this into perspective, it takes eight hours to manually sort just over 200 kilos in eight hours per person. That’s no mean feat. The machine on the other hand can sort 80 quintals, or 8000 kilos per hour.
REAL TIME REPORTING
But the genius of the technology deployed in the mill is the online reporting that is made available to producers at each stage of the process. Growers can access the system to track the progress of their lot with information provided on quality evaluation, defect counts, and status reports. This level of transparency allows them to make minor adjustments or changes to their own harvesting and post-harvesting practices to improve the quality of their coffee, even during peak picking season which usually occurs in December.
“We try to motivate our farmers to use the information system. We send them weekly reports with all the information about their coffee and process – so they can use it as a tool to make decisions”, adds Leinad.
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One beneficiary of this technology-driven effort to put the power back into the hands of the producer is Santa Rita, a women-owned estate based in Jinotega. Established in 1988, the UTZ and Rainforest Alliance-certified estate represents four generations of women coffee producers and relies on La Providencia to guarantee them the level of traceability demanded by their buyers. Although the 65 permanent members strong estate fully washes their specialty-grade coffee on the farm, they have been taking advantage of this level of transparency at the dry mill stage for two years.
CONFIDENCE TO ACCESS SPECIALTY MARKETS
Importantly, the processes and systems in place gives the estate the confidence they need to access specialty coffee markets around the world. This can be directly with green bean buyers or through pioneering direct trade platforms like algrano that puts producers directly in touch with coffee roasters.
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Eva Guerrero Lopez, Marketing and Sales Manager at Santa Rita, says that when the mill receives the coffee, they are sent information at each stage so they can forward plan and forecast their own sales and shipping commitments: “When the parchment is ready, they add the humidity measurements and we get a cupping score for every lot when the dry milled coffee enters the warehouse for storage. We can then sell and ship the coffee anytime between 60 or 90 days afterwards. Growers don’t always have access to what’s happening. That’s why transparency is so important because we have a person in the dry mill checking the coffee,” before adding, “at La Providencia we know it’s in good hands”.

This article was commissioned by algrano for the blog series Demystifying the Coffee Value Chain

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Coffee

A new dialogue in direct trade

A tech-based platform could be set to revolutionise how coffee roasters and growers interact and trade with each other. Algrano, a Swiss-based start up that officially launched earlier this year at Nordic World of Coffee in Gothenburg, Sweden, is shorthand for the Spanish phrase vamos directo al grano, or fittingly translated as – let’s get straight to the point. It’s a simple but effective concept that has already scooped a coveted SCAE award for tech innovation. The pioneers behind Algrano are also setting their sights on nurturing a global community of coffee professionals from opposite ends of the speciality coffee value chain by creating a space for dialogue and direct trade. The first shipping container of coffee grown by producers in Nicaragua – some of the them Cup of Excellence finalists – has already made its way across the Atlantic to the port of Bremen, Germany, and the team are now preparing their second container for growers in Brazil.

Visiting coffee producers in Brazil

As the trend in speciality coffee shops making the jump to roasting their own coffee gathers pace, there is greater interest in having more influence over the coffee’s journey from the crop to cup. Algrano is responding to this need by building the bridge between farmers and roasters  and overcoming the logistical challenges and risks of moving green coffee from one continent to another. Price per kilo, export and delivery costs are presented clearly on the platform and roasters have the opportunity to pay a premium above the cost of production to support improvements in agronomic practices or social projects.

The platform also helps to improve transparency in the coffee value chain by enabling farmers to present their coffees to new speciality markets and customers that they would not otherwise have access to. More than just an online marketplace, the ability to strengthen the ethos of traceable ‘relationship coffee’ where buyers and sellers are able to directly engage and share information offers huge potential. This is particularly potent in an industry where established coffee merchants can still hold a disproportionate balance of power in the complex supply chain.

Algrano co-founder, Gilles Brunner, who has an academic background in international relations and development wanted to explore how the private sector can provide innovative sustainable solutions to global agricultural supply chains. It was after a year of working in the field to support Brazilian coffee farmers achieve certification such as Rainforest Alliance accreditation that the idea of help growers and roasters to interact online took root.

Algrano Co-founder, Gilles Brunner

Brunner developed the idea with co-founders Christian Burri and Raphael Studer. The team was selected by the Startup Chile programme in 2013, and later Startup Brazil in 2014 to work with Fair Trade co-operatives to test the platform. The initial response from growers was extremely positive but it was not until they took their concept to the Speciality Coffee Association of America (SCAA) to understand the needs of roasters that the platform shifted to a trade platform where coffee could be bought directly from origin.

In May this year, the team met with growers in Nicaragua to train them on how to set up their own profiles and post images or updates onto the platform’s dedicated newsfeed. He feels strongly that content should be largely producer-generated so that an active community can be created from the grassroots up. “Our number one purpose is to connect growers with roasters. Since the launch we’re really happy that 140 roasters have now registered online and can request samples from growers up to two weeks before the container closes. The value that we bring is to consolidate all the demands of the roasters into the one container and ask the exporter to prepare and ship the container to its destination”, he says.

“We don’t import coffee and store it in a warehouse. We want the roaster to choose the coffee that crosses the ocean, and we think this has real value. Roasters tell us that it takes time and money to source really interesting micro lots and we want to make it easy for them and sustainable for producers to do just that.”

The Algrano team are now busy establishing links with coffee farmers in Brazil so that they can present a container with growers and exporters from the world’s largest coffee producer once the harvest of the 2015/16 crop gets underway later this year. Gilles adds, “coffee is a universal language and we’re here to help nurture those conversations between growers and roasters”. It’s the kind of language that coffee professionals and customers are keen to hear more of as the conversation increasingly becomes a chorus for transparent, sustainable models of direct trade.

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