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MAGGIEJO'S FAIR TRADE BLOG

15-03-2007

Never mind latte or cappuccino - the real debate gripping real coffee buyers (and other foodies) is whether you should have fair trade or organic. MaggieJo St John has travelled from Birmingham to Nicaragua to find out more about this and the coffee-making process.

This is my interview with Marlon Sobelvarro, in charge of the commercialisation of coffee with the fair-trade co-operative UCA Miraflor.

I: You're just coming towards the end of a very busy period?

M: Yes, for the past few months I've been coordinating with the producers over their estimates of how much coffee they'll bring to the UCA and when. I have to organise the transfer of the beans, after their first wet treatment, to the dry processing area which is near Matagalpa. We need to get their beans there and we need to fill a lorry load, so the logistics are important.

I: Why can't you dry process the beans in the warm dry zone of Miraflor?

M: Given the climatic conditions we could but it would need investments that are only viable on a large scale. The beans must be reduced to 12% humidity. This can be measured technically but is also something that experts can assess manually and visually.

As well as the large flat areas where the beans are laid out to dry, the warehousing is important. You need good ventilation, without direct sunlight, and the coffee sacks must be raised off the ground so the air can circulate.

And before exportation the dried beans, the pergamino coffee, must be processed to produce “gold” coffee (cafa oro). This is a machine based process that removes the skin and then poor quality beans must be removed.

Green coffee shouldn't be kept for more than a month so the pergamino coffee is processed a couple of weeks before the export date.

I: Why are there different export dates?

M: Later in the year, June, November, the price increases but there are suppliers who blend beans and they need to have the Nicaraguan beans during March or April. Our USA buyers, who purchase all our organic coffee, require it by the end of April.

I: I would expect the roasting to add value, so why is none of the coffee toasted before export?

M: Probably because of the initial investment costs in equipment, training and quality packaging.

I: What does it cost a producer to get their coffee harvested?

M: The dry processing charge this year is US$26 an export quintal. Then UCA charges $6.00 for transport, $2.50 for quality assessment and $5.00 for general costs. So in total there are costs of US$39.50 per export quintal.

I: What is the difference between a pergamino quintal and an export or gold quintal?

M: It takes about 2.27 or 2.37 quintals of pergamino to produce one of gold because of the loss of humidity and quality selection processes.

I: What is this year's price for coffee?

M: It changes all the time. We have to decide when to agree the final price. Our buyer either pays us $143 ($103 + 40) or $40 over the market price on the day we agree. So we have to take a decision concerning which way the price will go.

In early February the market price was $132 so if we'd agreed then the price would be $172 but now the price has fallen back so we'd only get $152. We have another couple of weeks before we have to confirm a price so we hope it will rise again.

I: And is this the FairTrade price?

M: No, it's the organic one. We haven't been able to persuade our USA buyers to pay the extra for the Fairtrade certification yet. We'd like to find Fairtrade buyers for our conventional coffee which is about two thirds of the total crop. UCA Miraflor markets around 500 quintals of organic coffee and 1000 of conventional. At the moment we sell that on the national market at $100/export quintal.

I: I'm surprised not more is organic.

M: Farmers are afraid to take the risk and they can't afford the transition phase. They have to manage their soil well and for a good organic coffee compost they have to buy ingredients such as rice husks, pay for transport and then there is extra labour and they rarely have the resources to pay workers. To convert, these small producers need financial (and technical) support.

I: And how many quintals might an UCA Miraflor producer harvest?

M: The smallest producers might have 7 quintals, the largest 65. (Interviewer's calculation - that means a cash income of around $7312.50. I wonder what the farm costs and what profit that comes to.)

I: Thank you very much.

M: A pleasure.

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