Sunday, January 07, 2007

 

Closing In on Season Two

New Programs Seem to Be Working...
As we close in on the end of the second harvest season as a Fair Trade co-op, we are excited by the farmers' enthusiasm and passion for producing their own coffee. The apparent success of the new microfinance program, while a bit surprising, is very encouraging. We re-established both our Fair Trade and financing status. The financing from Rabobank came through at the beginning of November and the folks from Fair Trade paid us a visit in early December to perform their annual review - the status of our certification looks solid.

Our equipment partners are still buried deep in paperwork, so we took the initiative of buying all the equipment needed to get seven village communal washing stations and seven private stations up and running. The JCFC provided the pulper, collection and storage bags, drying tables and washing equipment while the farmers built the station and harvested and processed their own coffee. The JCFC has staff members supervising production throughout the harvest.

Our business model for this year targeted 60 tons of dried parchment to produce 36 tons of quality green beans. We were able to offer early season harvest loans to farmers in September, two months before harvest. The loans totaled $10,000 and gave the farmers food on their table - and gave the JCFC a better ability to plan the harvest. We now have about 54 tons of parchment, and Ariya, the General Manager, is busy buying the final 6 tons this week.

A Merchant in Venice
We had the pleasure of sending members of the JCFC to the Slow Food conference in Italy in October. The Slow Food movement (www.slowfood.com) invites farmers, restaurantuers, and retailers to participate in their Terra Madre event every other year. I can't say I'm familiar with the program, but the general idea is to celebrate our relationship with growing and preparing fresh whole foods (?). The key is the farmers had a great time - their first visit to any place outside of Southern Laos in their lives. They returned with a better understanding of how their efforts as coffee farmers connect with the global economy and they cleaned up selling Lao arts and crafts to their fellow participants!

Coffee Economics
As expected, this has been a difficult financial year with a drop in the US dollar and an increase in world coffee prices. The drop in the dollar increased our coffee costs by about ten percent, about equal to our total operating costs. The change in world coffee prices is a challenge: we have to submit Fair Trade contracts to our harvest bank for the loans in September, and the coffee price the JCFC receives is fixed at this time. However, as world prices go up during the harvest, local coffee traders are free to raise their prices to our level or higher. This is great for the farmers but a real challenge for the JCFC. Fair Trade is aware of this shortcoming and will release a new pricing strtategy this month to improve the system.

Paksong Update
We had a great visit from the Kiwi/Aussie consultants interested in building a robusta marketing program for the farmers. They will submit their proposal to the folks at New Zealand AID in March with the hope of working with the JCFC to produce multiple containers of washed robusta in the next two years. This means expanded production and greater economic efficiencies for the JCFC and even better prices for the farmers.

The coffee business in Laos is getting new investors from Vietnam. In a move reflecting the recent increase in world coffee prices, the local governor has sold about 1500 acres of coffee plantation to a Vietnamese company. The land had been planted by the local villagers. They were compensated but because they never had title to the land, they had no say in the compensation. One benefit will be the paving of the main road through the JCFC villages in the south.

Land title issues for the coffee farmers haven't historically been a problem, but with the recent increase in coffee prices, many planting companies are looking around the plateau for new land. The farmers have title to the land in their village, but much of their coffee trees are in the forests and land surrounding the village, land that is owned by the government.

Traditionally, farmers have been allowed to farm these lands. The farmers have avoided pursuing titles in the past to avoid paying taxes, and they may have been expected to pay a purchase price of some sort to the local governor. We are looking at implementing a new effort to help JCFC farmers secure titles to their coffee lands.

Happy Holidays from the JCFC Staff and Famers!

Comments:
Hey, when does Jhai set up shop in Toronto? Greg and Sarah are ready to go - call us.
 
will,
what i commented in 2006,
is happening...
viets are "buying"/confiscating
untitled forest lands.
your short-term coop members now
are landless and treeless.

what to do??--
if you can...
1. get treehuggers, ngo's, WB, etc. to lobby against
deforestation and clearcutting
for industrial plantations.

2. buy lands, never sell land.
What are viet SOE's paying?

sooner than later, you'll have
flooding, "pesti-demics", and
species disappearing.

viets and chinese don't care,
never did.

microloans for food & school--
NO00--loans are for investing,
not spending.
Always hand over cash to mom.

a better way, is "in kind", i.e.
groceries, school supplies,
tuition certificates.

the best way, is cashless
system.

and you don't need $ky-high
technologie$.

want better solutions, mail me.

dad can't drink books, uniforms,
and restricted vouchers.

my niece's Peace Corps contract
terminates in November....and
she extended 1 year in B.Faso.
4 of 51 did.

TIGER COFFEE SYSTEMS (tm)--
my office delivery business
model serving Organic-Fair Trade
JHAI.

aloha,
donald yap
>faxfree@yahoo.com
still popcorn-roasting green
lao washed A.typica.
 
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