Sharing a border with the largest coffee producing nation in the world is not easy. Peru’s coffee farmers and green coffee exporters cannot hope to compete with Brazil on efficiency or its prices. Thus, Peru must constantly work to differentiate its coffee.
For years Peru has been shifting its focus to high quality coffee production, sustainable operations throughout the value chain and long-term loyalty between farmers and exporters. The past several years have shown substantive progress in upgrading quality at the farm level. And despite challenges brought on by COVID-19 the change in quality is evident in the cup. The 2021 Peru green coffee lots at Genuine Origin are some of the best yet.
Coffee cuts a swatch through Peru. The cash crop is grown from the northern tip to the southern tip of the country. Peru is divided into three regions: the coastal deserts along the Pacific Ocean, the Andean highlands that run throughout all of Central Peru, and the Amazon rainforest that borders Ecuador, Colombia, and Brazil. All three of Peru’s regions are extremely fertile, but the high elevations of the Andes mountain range are ideal for high-quality Arabica production.
With two ports — Paita in the north and Callao in the south — Peru is also positioned to be flexible when it comes to shipping green coffee to the world. The coffee sector generates 855,000 jobs for Peru’s economy, and over half a million people depend on the crop for their livelihoods - including the harvest labor force. With coffee prices low, uncertainty looms over the future for coffee farmers but exporters like Volcafe Peru, Genuine Origin’s sister company in the region, are working to change that.
Since 2014, Volcafe Peru has been going the extra mile to ensure that its producer partners are sustainably profitable. “We want to provide something different,” says Harry Odio, General Manager of Volcafe Peru. “We have the ability to source coffee from 800 to 2,000 meters above sea level and we can provide whatever clients are looking for in terms of acidity, body, and characteristics of the coffee.”
More than 75% of the coffee produced comes from elevations above 1,200 meters. That’s where the signature sweetness and sparkling acidity of Peru coffee starts to shine. There are huge differences in quality due to the range of elevations and Peru leverages this diversity in quality to please more customers.
Country-wide Production of Specialty Coffee
Approximately 150,000 farming families produce Peru’s four million bags of coffee each year. Most of it is traditionally washed at the farm level and sold in parchment. Sometimes farmers keep their coffee in home storage for months after harvesting like money in the bank. They sell it only when the household needs cash for school fees and the like. Volcafe Peru is trying to change this model.
Buying cherry and milling it — as opposed to buying parchment from numerous smallholders — allows exporters to control quality. To that end Volcafe Peru has spent years motivating farmers to sell cherries directly. The company’s seven buying units in northern and central Peru facilitate purchasing cherry. And its new mill in Jaén now processes coffee for thousands of producers in the Cajamarca region.
Northern regions such as Jaen and St. Ignacio are growing in importance. Quality is improving and farms are becoming more productive, so the new Jaén mill is of strategic importance. In addition to parchment drying, the mill has also installed solar dryers that are free of charge for Volcafe Way producers. The intention is to demonstrate Volcafe’s commitment to its producer partners; it also has a tangible impact on quality and efficiency.
Growing More Specialty
Volcafe Peru operates on three pillars: quality, sustainability, and loyalty. With the addition of Volcafe Way ideology, they have further organized their efforts to maximize impact and produce premium-level coffee. Lowering and controlling costs for farmers is key to what they’re doing and by raising prices for better quality, they are building producer loyalty to the brand.
Over 3,500 farmers are participating in the Volcafe Way program in Peru and the company commits an annual investment of USD1.26 million in three major producing regions. The objective of Volcafe Peru’s work is to transform basic farms into premium farms through technical intervention, capacity building, and performance monitoring that adds up to an evaluation system for farm quality. Every coffee lot from Peru at Genuine Origin is sourced from a Volcafe Way producer.
But Volcafe Peru doesn’t stop there. Five years ago, they began working on a “Cluster” concept. In Clusters, Volcafe Peru developed a way to work directly with a group of farmers and a roaster. The objective was for the producers in the cluster to grow coffee exclusively for the roaster for a contracted amount of years. Critical to the Cluster concept is that funds are reinvested into farm infrastructure and technical assistance. This cluster system is a true partnership with the potential for a scalable impact.
The Cluster program has helped to stabilize the supply chain for roasters and farmers while providing detailed traceability and consistent quality. It also encourages medium and long-term commitments all around. By utilizing Trackvia technology, roasters can view coffee purchase information on a daily basis, including producer details and pricing. Volcafe Peru is bringing coffee directly to the market with full transparency from field to FOB contract, bolstering the roaster’s ability to see how much value is really added through the work in the field.
The Cluster program has expanded to three clusters covering 2,672 farmers. Clusters are determined by areas and producers are chosen depending on what a roaster is looking for, with initial evaluation based on quality and volume. “To achieve farm profitability, you need productivity, quality plus price, and farm management. We can’t be successful if we don’t involve the roasters. Clusters plus Volcafe Way plus supply chain management is the key to achieve our goals faster,” says Odio.
While Peru is the top exporter for fair trade and certified organic coffee, the question of sustainability is much more complex than ticking the right boxes. Whereas Volcafe Peru works with all of the certification seals, it recognizes that the seals are not a cure all.
Organic farming can leave crops vulnerable. A prime example: in 2011 organic farms in Peru were crippled by leaf rust.
The question is: How do you make Organic sustainable? Organic farms tend to have lower yields than farms that use conventional fertilizers — but generally the end customer will not pay the premium to make up the difference. Finally, the transition alone from a basic farm to an organic one takes three years of downtime, something that many farmers — the ones that truly need the most assistance — cannot afford to take on.
Volcafe Peru draws on a deep evaluation of farms to understand how they can make the most impact. All efforts are invested into making coffee production sustainably profitable year after year and that includes improving farming methods — organic or otherwise — to reach sustainable levels as well. This is why Volcafe Peru is adapting the Volcafe Way methodology to organic farms.
Going Beyond Specialty Coffee Sourcing
In 2020, COVID-19 hit Peru hard. Even a year later, infections continued to grow in a new wave, despite a reduction in rates around the world. Back in July, Volcafe Peru reported an increase in infections moving from cities to rural areas and a growing fear for coffee farmers to interact with buyers.
Volcafe Peru continuously reinvents the way they do things — from flyers to radio shows to phone calls — in order to deliver confidence to farmers that they are taking the pandemic seriously while still providing an orderly and safe way to keep the supply chain going. Everyone on the Volcafe Peru team has been tested, including the 26 field technicians who work directly with farmers, and the company has been working nonstop to keep the virus from spreading.
Genuine Origin & 2021 Peru Green Coffee
Quality control has always been strictly implemented throughout the supply chain and new protocols were developed in order to continue cupping safely and efficiently. With that being said, the 2020/2021 green coffee lots from Peru are some of the best ever and Genuine Origin has already received shipments from the top producers in the country.
The new Peru Organic Chasqui lot, named for the strongest and fittest messengers of the Incan empire, was first created for Genuine Origin in 2018 and draws on the best coffees from central Peru. This year, we’re excited to offer an organic iteration of Chasqui from Cajamarca, San Martín, and Junin. With its heavy body and mild acidity, Organic Chasqui is a great option for cold brew and blends.
“In Peru, we have everything and can grow anything we want. The environment and the conditions are here to do it,” says Odio. The goal is to create a Volcafe Peru Cluster for Genuine Origin, leveraging Volcafe Peru’s success with the current clusters and the excellent results that have come from the initiative.
Coffee Roasters can expect delicious lots from the cream of the crop in Genuine Origin’s Peru portfolio. To learn more about Peru and Volcafe Peru, watch Genuine Origin’s Peru Origin Report Webinar on YouTube.
Find out more about Genuine Origin’s Peru coffee collection on our website — https://www.genuineorigin.com/peru