Monday, July 8, 2019

Eliminating Waste Using Machinery - Dukundekawa Musasa

July 8, 2019
Dukunde Kawa Musasa drying tables offer a spectacular view of Gakenke district mountains.
In Rwanda, you often see four armed soldiers or policemen walking single-file on the side of the road. They walk slowly, as if they have all day to get where they are going and they know they have to walk many miles. I often wondered whether the objective is 1. to be seen on the roads or 2. to get where they are going. Today I learned that at least sometimes, it is to "get where they are going." I stopped at a dusty mountain intersection to ask directions from a civilian, and the lead soldier in a group-of-four walked up to my car and said they needed a ride. Next thing I knew, I had three soldiers with machine guns in my back seat (my translator in the front passenger seat) and the 4th soldier was crouched in the luggage space of my Toyota Rav4 with knees to his chin!

The above scenario is a metaphor for the way Rwandan coffee is also beginning to "get where it is going" by using machinery. For the soldiers, a half-day's walking journey, became a 15 minute, somewhat cramped, car-ride. At Dukundekawa Musasa in Gakenke district, I saw how a forward-thinking cooperative of farmers is investing in machinery to take them where they are going faster.

Since my first visit to Dukundekawa in early 2016, I've returned at least three times. Each time I see new investments in machines. [1]

What Dukundekawa is doing is eliminating waste. They are doing so without knowing that they are demonstrating Lean at Origin principles. (Refer to our "Resiliency Coffee" blog and search on "Lean" to learn more about Lean at Origin.) Here we will share the unique machines that Dukundekawa has brought on-line and name the wastes that these machines will help eliminate.
Pinahlense 11 MT cherry sorter.

1. The Pinhalense cherry sorter was first used in the 2015 season, and fully implemented before the 2016 season started. This machine eliminates defects (one type of waste) by sorting cherries by density that have just been delivered by site collectors. Site collectors bring large volumes of cherry to the washing station. One site collector might arrive with as much as 800 kg. The cherry sorting machine uses gravity, water and floatation. The machine's channels shake and have holes in the bottom to separate the dense (good) cherry from the light (bad) cherry, sometimes called "floaters." The two types are moved into a different chutes. Dukundekawa staff can easily measure the weight of the floaters of any site collector's delivery. The agreement signed with the collector is that if any delivery has more than 1% floaters, the entire weight of floaters will be deducted from his service pay. In the 2019 season, only one collector over-stepped the 1% mark for allowable floaters. Apparently, the threat of a monetary fine is usually good enough to ensure site collectors are strict with quality control at their site.

Looking left.

Above: Looking right. Entrance to reception area is designed for easy access of trucks and farmers.
2. In 2015 Dukundekawa re-constructed the entrance to the receiving area for cherries. They eliminated wasted transportation of material and wasted motion of people by thinking about how to allow trucks and farmers carrying heavy sacks on their heads to get as close as possible to the scale for weighing their delivery. The ramp from the main road (top photo) slopes down and curves towards the reception area, which can be seen straight ahead in the bottom photo. (Under the roof shown in the bottom photo is where the cherry reception process starts.) The improved access saves the steps of workers and farmers who spend hours of back-breaking labor at other washing stations to move heavy sacks up stairs, around columns and over bumpy, steeply sloped terrain to unload trucks or just arrive on foot. While not yet documented, it's possible that the improved access has shortened the lines during peak season, eliminating waiting, another type of waste.
Outside of dry mill


Inside the dry mill.

3. In 2016, Dukundekawa built a dry mill -- right across the street from the washing station (wet mill), establishing one of only a handful of dry mill functioning outside of the capital of Kigali and bringing a significant industrial process to their rural mountain village. Besides increasing the number of skilled and unskilled laborers employed during the season, the dry mill had all the benefits the cooperative management had been longing for: more control over export preparation of their semi-finished product, parchment coffee. The new dry mill eliminates defects by allowing the coop direct control of machine maintenance, settings and storage. It eliminates unnecessary processing steps by allowing the coop to skip steps in the milling process if they are not required by a customer order. It eliminates waiting, because in Kigali the cooperative's trucks of parchment could wait days or weeks for "their turn" to be processed. It eliminates wasted transportation of material, wasted inventory, and wasted motion of people. Clearly, the investment in a dry mill helps Dukundekawa eliminate wastes of many kinds, and the associated costs, for all future seasons, while at the same time increasing quality. It is a strikingly good example of Lean at Origin management.

Manager Isaac with drum dryer
4. In 2018, Dukundekawa purchased a mechanical drum dryer for more speedy drying of low-quality coffees. This dryer eliminates defects to high-grade coffee that occur when space on raised tables is lacking, and quality grades therefore get stacked too high or worse - left waiting in a tank too long. It also eliminates waiting, transportation of material and motion of people. Without a drum dryer, washing stations are forced to dry low-grade depulped coffee on drying tables, taking up valuable real estate for higher grades, or dry the low-grades on plastic sheets spread on the ground. Drying on the ground is unsanitary for the coffee, lengthens the process and involves several additional movements of material and people. However, the real beauty of being able to whisk low-grade coffees into a mechanical dryer is the additional space gained on raised beds for the high-quality coffees, especially during peak season.

Two new coffee elevators (l and r) and the new Sortex color sorter from Buehler.

Rwanda's only Buehler Multi-vision Sortex B now resides at Dukundekawa's dry mill.
5. Now, in 2019, Dukundekawa is in the final installation stages of a Multivision Sortex B color-sorting machine from Buehler. The main waste eliminated by this machine is defects. Olivier, the installation technician from Brazafric, explained to me that the Multivision uses three wavelengths and can therefore detect colors that other (two-wavelength) color sorters in Rwanda cannot. Importantly, they believe they have shown in tests that discoloration from insect damage, not detected by two-wavelength machines, will be identified and rejected by the Multivision model. This capability has the potential to significantly reduce potato taste defect in Rwandan coffee, which has been shown to be highly correlated with antestia bug infestation (click here for the paper).

6 new conveyor belts for sorting green coffee. Automated movement to the "mixing silo" at the back.
Workers will be able to sit during their 7 hour day and sort the green coffee under UV lights.

Chairs where hundreds of women will be able to sit, instead of sitting on the floor to do their job - improving worker conditions, avoiding injury.
6. Also this year, Dukundekawa is installing six new Pinhalense conveyor belts for sorting green coffee, connected to automated transport to a mixing silo. The new equipment and chairs will eliminate waste from defects, waiting, transportation of material, motion of people and inventory. This new process is an advancement and transformation from the traditional hand-sorting method. In most dry mills in Rwanda, you will find a giant hall like the one pictured above, with hundreds of women (and a few men) sitting on their scarves, stretched out like a blanket on the floor. They will have one or two of the plastic bags used for transporting parchment flattened on the floor next to them, on which you will see two or three piles of green beans: the unsorted pile, the "good" pile and the "bad" pile. They work for 7 hours a day. In the dry mill I know best, there is a supervisor who walks around to all the women checking their work, letting them know when/if the "good" pile is good enough to move on to the next bag. [2] Once their "good pile" is approved, each worker has to carry that pile of beans to a different place in the hall, and the "bad pile" or waste beans to even a different place (see spaghetti diagram below). Clearly there is wasted movement of material and people, much waiting for a supervisor and potential for human error under such conditions. Dukundekawa has changed all that.
A so-called "spaghetti diagram" of the traditional hand-sorting process helps visualize the wasted movement of people and material. (The steps of each worker are dotted lines that look like a plate of spaghetti.)
7. A highly valued resource for every coffee producer, however, is a fully equipped and on-site cupping lab. Cupping labs allow a trained cupper to evaluate the quality of each lot of coffee, and thus enables the producer to know the potential value of their crop. Dukundekawa is already advancing from their first on-site cupping lab to a new, still-under-construction, state-of-the-art cupping lab that will likely qualify for Specialty Coffee Association certification.
Outside the old cupping lab - this one to be discontinued this year.

Inside the old cupping lab.
New, quite large, state-of-the-art cupping lab under construction.
With a cupping lab, old or new, producer groups are able to go much further with understanding the quality and thus the value of their coffee. They can work more strategically to eliminate defects in all parts of the production system.

My ride with the soldiers ended happily for everyone, by the way. I invited them to try the brewed coffee I had just purchased at Bourbon in Kigali and kept warm in a thermos. I had little thermal cups (typically used when I serve farmers) and we all stood around enjoying a nice coffee break with Rwandan coffee!

[1] This is the first time I've arrived at Dukundekawa as a buyer. Prior visits I was wearing only my researcher hat. This year Artisan Coffee Imports will import just a few bags of Dukundekawa's Rambagira group women's coffee. Rambagira coffee is from Dukundekawa's female members and it is collected on Wednesdays during harvest. Then it's kept separate throughout processing and export.
[2] The usual rate of work is 30 kg of green coffee sorted per person per day, for high-grade coffee. More coffee can be finished per day for lower grades.


Monday, May 6, 2019

What to Pay for Coffee - Not So Complicated

May 6, 2019
Ejo Heza women's group in Rwanda - sorting cherry

Guest blogger Kathy Tian, MBA/MS 2020, Erb Institute at the University of Michigan and Ruth Ann Church, President, Artisan Coffee Imports

Let's say you're a coffee roaster. Is it complicated to know what to pay for your green coffee? Not so much. Drawing content from two panels at SCA Expo in Boston we synthesize why. Both of these panels rigorously researched costs in Colombia and Rwanda: two different countries and two different continents. In one panel, "East Africa Quality Innovation," Ruth Ann Church shared  the connectedness of marketing, price and quality in Rwanda. Guest blogger, Kathy Tian, spoke on a separate panel: "Implications of Specialty Coffee Farming Costs in Colombia." 

Recommendations to roasters boil down to three steps:

1. Ask your importer if their contract with the producer is a fixed price contract or based on the C-price? Hopefully the importer's answer is that your less-than-container-load of bags of microlot coffee were bought on a fixed price contract. For microlot purchases up to about 300 bags, (sometimes more), this usually possible. NYBOT C-price based pricing is necessary when the coffee volume is large enough to need hedging in futures markets.

2. Ask your importer what is the farmer paid? Hopefully the importer's answer is "we can tell you that no problem." And then they give you a $ per unit answer. If they give you a lot of excuses about how difficult it is to answer, try reassuring them that you can handle doing some conversions if they can't. But shouldn't an importer be able to do the conversions (from local currency to US$; from KG to pounds; from cherry to green)? For example, Artisan Coffee Imports shared the prices Kopakama's members received for the past three years in this chart during the SCA panel:
KOPAKAMA Coop
2016
2017
2018
2019 (projected)
Avg. farmer price* $/lb. green
$.70/lb
$1.02/lb
$1.07/lb 
$.80/ lb
farmgate + 2nd payment + premiums

If your importer seems conflicted or "over asked" when you inquire about the price to the farmer, there's a fair chance that he/she doesn't know. And there's a fair chance they would like to know also, but they have been deflected by their contact at origin when they try to find out. YOU can be the catalyst towards more transparency and education about where value is in the value chain. YOU, as the roaster, have a powerful position in this chain, no matter what your size. If your volumes are small, then your questions and your responses to answers may not change current business practices in the short term. But, when you ask the questions and urge your supplier to get clear answers from their supplier, your voice makes a difference over the long run.

Cherry harvest in Rwanda
3. What is your pricing philosophy? There are many things to consider when it comes to your pricing philosophy, including how much to anchor on the NYBOT C-price, and how much time and money you, the roaster, wants to invest  to understand costs. Also, how much you believe the farmer should be able to dictate their own price. Kathy Tian, based on her experience in Colombia, recommends focusing on the following two thought processes first, which may help simplify and clarify the roaster's approach:
1)      Think about today’s farmers and future farmers. Try to understand the opportunity cost for a young person in the origin country who can consider coffee farming against other options to earn a living.

An importer could potentially play a critical role in helping you achieve this part of your pricing philosophy. For example, perhaps your importer can share what the opportunity costs are of current and future farmers at origin. More than likely, a young person will have alternatives available to them in agriculture. A knowledgeable importer may be able to share the exact value of opportunity costs for you.  

2)      Think about the power that you have in your value chain to lower costs, other than the price paid to the farmer. If you are a small roaster sourcing exclusively from farms of <0.5 hectares, your ability to realize cost savings upstream is very limited. Instead, consider ways in which you could lower costs at the roaster level.
There are a few ways to lower costs at the roaster level. One opportunity is for small roasters to encourage medium size roasters that benefit from economies of scale in packaging, retail, and transportation fees to take action to address the needs of small holder farmers. This is currently happening in the industry but could be amplified to create more rippling impacts in coffee communities around the world. 
A second option is for small roasters to work together and share supply chains—collaborating on sourcing. This should reduce costs of exports and imports by guaranteeing larger order quantities, which can be passed on to the farmer. 
Alternatively, some small roasters seek out green bean importers who act as the consolidator of many small orders and transparently share the cost savings with the producers. "Transparently" in this case means the importer can tell you the dollars and cents per unit (e.g. per pound green) the farmers received. (See 2 above.) 

Wednesday, April 17, 2019

Economic Sustainability Panel Offered at SCA Expo Boston

April 17, 2019
A few days ago a panel, organized by Artisan Coffee Imports, took place at the Specialty Coffee Association (SCA) Expo in Boston titled, "East Africa Quality Innovation."
Panelists were (LtoR):

·       Sara Yirga, moderator and founder of YA Coffee Roasters in Ethiopia
·       Rachel Samuel-Overton, Co-founder Gesha Village, Ethiopia (private estate)
·       Lauren Rosenberg, Managing Director, Long Miles Coffee, Burundi (private)
·       Ruth Ann Church, President of Artisan Coffee Imports, representing Kopakama coop, Rwanda

The combined insights from these speakers offered the audience an opportunity to hear how three East African organizations from three different countries -- Ethiopia, Burundi and Rwanda -- are tackling the complex contexts in which they work. They shared their stories of how they offer brilliant tasting, fruity East African coffee, with narratives that are genuine.

The panelists focused primarily on marketing, and how marketing green coffee as a producing organization requires also attention to price paid to suppliers (either farmers, workers or both) and quality control mechanisms, to control the quality of incoming coffee.

Gesha Village, the relatively new estate established in 2011 in Bench Maji zone, Ethiopia, shared an inspiring video that advertises their annual auction. The estate earns 15% of revenue from sales of the 6% of coffee sold during the auction. Prices can go as high as $100/lb green.

Long Miles Coffee, founded in 2013, offered the perspective of a private organization, working in a complicated and ever-changing regulatory context. Their mission is to uplift farmers and to do this, they find they must continuously find ways to work closer with the farmers, 12 months per year. Ms. Rosenberg also highlighted the visibility they give the story of the farmers through their Instagram posts and other media easily accessible to roaster- customers.

Kopakama, a cooperative started in 1998, represented the oldest organization and farmer-owned-and-controlled business model. Kopakama holds a triple certification (Fair Trade, Rainforest Alliance, Organic) and most notably pursues "Lean at Origin" processes. This management philosophy is well-known in other industries, but is new to coffee. With it, Kopakama is moving towards more efficiency, in order to allow its employees to focus on growth, not every-day fire-fighting.







Sunday, April 14, 2019

Cupping Great Coffee at IWCA-SCA Cupping

April 14, 2019
Surprise! There really are enough fanatic roasters and cuppers at an SCA Expo to fill a large cupping room, even at 8:00am on a Sunday morning! At least 46 guests flocked to taste the over 70 samples from 10 countries, representing all three coffee-growing continents (Africa, Asia and Latin America) and 47 different female producers - all members of International Women's Coffee Alliance (IWCA) chapter members. Click here to see the list of all the coffees.

The IWCA hosts this annual cupping event with generous support from the Specialty Coffee Association (which donates the space), and Firedancers Consultants (which collects, carefully sample roasts all samples, and leads the cupping). This year the event boasted additional sponsors -- Joe Coffee Company of New York City and City Girl/Alakef Roasters in Duluth, MN sponsored the new cupping aprons with the IWCA logo. Thanks to all these sponsors for supporting women in coffee around the globe!








Friday, March 1, 2019

Cherry Price and Farmers' Benefits

Farmer Field School – Abichizahamwa group
March 1, 2019

Today marks the day the National Agricultural Export Development Board (NAEB) will formally meet with about 100 owners of washing station in Rwanda and announce the "opening" floor price for cherry. They are setting it at an astonishingly low 190 Rwf/Kg cherry. That converts to about $.62/lb green and it is 36% less than the 300 Rwf/kg cherry ($1.07/ lb green) shown to be needed by farmers to incentivize best practices for coffee cultivation.

Several large exporters, however, are heavily invested in selling low-grade, fully-washed coffee. This is a product for which Rwanda cannot compete on a global stage against competitors from Brazil, Colombia and Ethiopia. These exporters drag down the cherry price and retard the entrance of the entire Rwandan coffee sector into a new age where Rwandan coffee is recognized as the "Panama of Africa." 

The benefits to farmers are significant when exporters agree to pay a rational share of the FOB price as the cherry price. Artisan contracts require that farmers are paid at least 300 Rwf/Kg cherry, and we have documented the following benefits over the past year:

Farmer Field School – Abichizahamwa group: 6 men, 24 women
The Ejo Heza members in the FFS were asked if they remembered anything special that happened at the last general assembly. They remembered receiving the premium. Then the agronomist asked if anyone would like to share what they did with their premium. (Names changed.)

Valerie MUKASHIMANA
Rec’d 53,000 Frw (~ $60) premium from Artisan. She was able to buy 3 bags of cement and put pavement in the floor of one room - the dining room in her home. She wants to improve the taste of her coffee so that “we can continue to develop.”

Dorothe MUBARAGA
Rec’d premium of 12,400 Frw (~ $14). She bought chickens and hired a person to help her weed the coffee and the beans that she grows. Got the money when it was a ‘bad situation’ (poverty and hunger) in our community. Helped my family very much.

Marie MUKAHERESHIMA
Rec’d premium of 55,000 Frw (~$62). It helped her to buy another cow from which she can use the manure to fertilize her coffee organically.

These amounts of cash mentioned above can be verified in the list of 320 names showing that each woman signed for their premium on October 31, 2017. (A similar list is now available for the 2018 premium.) The premiums from roasters are impacting these women’s lives and motivating them when we explain new tasks and efforts we’d like them to try to improve quality and consistency, and avoid potato-taste defect.

Want to learn more about how powerful premiums are? Listen to one of two interviews with Bette UWIMANA - posted on-line in 2018:
Short one – CLICK HERE.
Long one – CLICK HERE.

To summarize, here are paraphrases of comments from Ejo Heza members Bette UWIMANA, Martha Uwiherewenimana and a comment from the male members of Kopakama:
* Bette says the women of Ejo Heza were very happy. She said that the primary uses of the extra money were school fees, purchase of small animals (goats, pigs, chickens), and the fee to be enrolled in “Mituel”, the national health insurance. 
It inspires young, ambitious farmers to invest deeper in coffee and take on leadership roles. Bette Uwimana and her husband are a good example of this. Bette is 28 years old. She and her husband have 2 children, 8 and 4 years old. They’ve benefited from coffee for over five years, but only last year (2017) decided to join Ejo Heza. I suspect seeing the women receive the premium was the “decision-maker” for Bette. She has been on the staff at Kopakama for several years, seeing how the Ejo Heza women improve their production, and then seeing the premium she finally decided to join. She and her husband have 1,650 trees. Thus the impact of the premium is both individual and community: capacity building for Bette and new, young leadership for the Ejo Heza group. 
*Speaking to Martha Uwiherewenimana, the new president of the Kopakama cooperative, she personally appreciated receiving the premium last October and knows that the Ejo Heza women were amazed to receive this extra money directly in their hands. She is confident that premium will do much to overcome any objections to testing some new practices Artisan is suggesting to improve quality, (e.g. floating cherry to separate out floaters before paying the farmers).
Appreciation - even from the men: When a group of male and female Kopakama farmers were asked (during a field school) whether conflicts or jealousy developed when the women of Ejo Heza received a premium, a male farmer answered. He said he was proud of his wife for being an Ejo Heza farmer, since that meant their household received a premium. If she had not been a member, the household wouldn’t have received any premium last year. (The cooperative normally pays a second-payment to all members in January, but in Jan. 2018 the members decided to pay down the loan they took out to build the dry mill.)

Sunday, February 10, 2019

Maceline and Mary Share Farmer Experiences

Feb. 10, 2019
During my visit to the Ruli Mountain washing station owned by Land of One Thousand Hills (LOTH), I had the delightful opportunity to interview two farmers. They belong to the approximate 1,200 farmers who deliver cherry to this washing station, which collected 451,000 Kg cherry in 2018.  Maceline (age 40) and Mary (age 36) were kind enough, through my interpreter, to accept an invitation from the washing station manager to be interviewed on the date of my visit. My objective was simply to provide a snapshot of "who is a farmer?" at one of LOTH's washing stations.

Maceline M:
Age: 40
# of Children: 3 - one of which was there for the interview. Charming "Mick."
# of coffee trees: 100 - shared ownership with husband. These trees were purchased in 2011.
Started coffee farming: 25 years ago with her family when she was a child.
% of income from coffee: 50%
Cherry price: In 2017 she remembers receiving 320 Rwf/Kg cherry.

She got the 100 seedlings she and her husband own from LOTH. Now coffee is a source of income and development for her family. They also grow beans, soya, maize, sweet potato, banana, casava and vegetables. She says she and her husband decide together about how to spend the income from coffee. Everyone in her family participates in delivering coffee cherry to the washing station.

Mary M:
Age 36
Children: 3
# of coffee trees: 840 total; 420 were planted 5 years ago; another 420 were planted just 3 years ago and so the very first harvest was 2018. She received the seedlings 3 years ago from a LOTH program.
Cherry price: in 2018 it was 280 Rwf/kg cherry. In 2017 it was 320.

They have found that good things come from coffee. Income to pay Mituel health insurance and solve other issues. The coffee money is a lot, but it spends quickly! Her family also grows bananas, casava, beans, vegetables and maize. She explained that is can be either her or her husband who comes to the washing station to receive the coffee payments. They hope that they can get 300 Rwf/kg cherry again this year. This would mean they earn a small profit.

We talked about the practices they are using on their coffee fields. When it came to the topic of mulch, they both complained about the high cost and the difficulty to access mulch. I asked them to help me understand what "expensive" means. They explained that first they often have to travel far away from the plot to find a place with mulch grasses growing. Then they are charged (for a swath of land they indicate with their hands) 80,000 rwf for the grass itself; 20,000 rwf for the labor (they do not do the cutting alone); 20,000 rwf to the land owner (service fee); and 20,000 rwf for transport. In total: 140,000 Rwf ($157) for that day's mulch delivery.

Friday, December 7, 2018

What Transparent Trade Looks Like

Dec. 7, 2018
The new wave of roasters want more cost transparency to complement their relationships to the farmers who grow their coffee. That's what we offer at Artisan Coffee Imports in a way that other importers cannot. We offer a closer connection, a deeper relationship through cost transparency, to the coffees we source. (Click here for the last blog describing some of that connection at Kopakama.) Currently we focus on Rwanda, but soon we'll include other origins. As we expand, we plan to replicate the model we've developed in Rwanda:
  • Receipts tracking how the money got to the farmers. Artisan sent $7,290 in mid-November to pay the $.30/KG green second payment to Ejo Heza farmers. Kopakama sends to Artisan the receipts showing conversion of the $7,290 to RWF at a Forex office and the bank receipt confirming the funds are deposited in Ejo Heza's local (Mushubati) SACCO account.
  • Signatures of the farmers themselves on lists with their names. Kopkama also sends the lists, broken out by sub-groups, of the women who received their share of the $7,290 mentioned above, in their hands, on November 30, 2018, during their general assembly. Click here to see the previous blog with photos and video!
Pay day!

Farmer Compensation Revisited:
This works for the second-payment. The other, more important piece of a farmer's compensation is the first payment -- the payment received for cherry as it's delivered. For example in Rwanda, this base cherry price can range from 150 - 400 Rwf/Kg cherry. A second payment typically ranges from 10 - 35 RWF/Kg cherry. In percentages:
  • base cherry price = 90 - 100% of farmer's compensation for coffee (many farmers receive no 2nd payment)
  • second payment = 5 - 10% of farmer's compensation for coffee
Obviously, the most important piece of a farmer's compensation in Rwanda (and many E. African countries) is the base cherry price. How that cherry price is set is a critical question. Is it based on pure competition for cherry in the market? No, it's usually a mix of government regulations and competitive forces. In cultures with low tolerance and understanding of competition and market economics, the former, (government regulations), tends to be the more dominant determinant of the farmer's cherry price (see paper referenced below). Unfortunately, two major hurdles are frequently encountered in origin countries:
  1. Lack of market data
  2. Overly heavy influence of a few, oligarchic players
These two factors can both, independently, weaken the government's ability to design and implement effective regulations, even when the government's intentions towards the farming community are positive. A recent paper in the Journal of Rural Studies delves deep into this topic in Rwanda. 
Bette, one of Ejo Heza's leaders, meets Ritual's buyer, Aaron.

The New Wave Roasters: Junior's Roasted Coffee (JRC), Portland, OR, is an example of the trend we anticipate will continue. Daily Coffee News recently wrote about Mike Nelson's multi-year effort to bring deeper understanding of cost transparency to his coffee supply chain.

The picture that became clear to Nelson was that in order for JRC to purchase a grower's coffee at a price that allowed the farm to break even, a significant premium would have to be added to the going market price. "Given the longstanding relationship between the roaster and the producer, and that the coffee consistently cups up to Junior’s stringent standards, JRC was happy to pay more for the benefit of all involved, today and into the future."
“We were able to come up with a premium,” said Nelson. Nelson's importer was paying $3.25/lb. green to the farmer, and Nelson added an additional $.75 per pound green, to ensure break even on his coffee purchase." Thus, the producer in this case is receiving $4 per pound on this coffee. With the premium, the price JRC paid to the importer was $5.62 a pound. "Adding shipping, roast loss, labor, packaging, and everything else, this worked out to be an $8.10 per pound coffee [for Junior’s].” 

JRC's roasted coffee (consumer-facing) label says: 
"Coffee is traded as a commodity, trading for as low as $1.00/lb during the 2017/2018 season. This season, it cost the [producer name] $2.87/lb [green] to produce this coffee. We paid $4.00 /lb [green] directly to the [producer name] family to cover production costs and to help ensure future production."
JRC is making their support for covering cost of production not only a clear priority of the company, it's seems to be a value. It's a little like telling airline customers exactly how much you, as the airline operator, have included as a carbon credit in the price of the ticket. You're making sure you cover the real costs of production, and you're ensuring sustainability of your industry. [Story credit to Howard Bryman, 10/1/2018, Daily Coffee News, published by Roast Magazine.]


Charlotte (Kopa), Ruth Ann (Artisan) and Dominique (Kopa)
Importer's Role: a final note here about the role of JRC's importer. One might ask why JRC had to go to all this trouble to find out the producer's cost of production? And more trouble to arrange a way to make the producer whole? It appears JRC's importer pays the producer a price that is either at or below the farmer's cost of production. In this happy case, a roaster came along to ensure not only costs are covered, but there is profit for the farmer to reinvest. At Artisan Coffee Imports, we assure all our roaster customers that farmers who grew the coffee we sell are paid a price that covers cost of production and a profit margin. For the base price, (before any second-payment), our minimum is 300 RWF/Kg cherry, well above the average cost of production in Rwanda of 177 RWF/Kg cherry. Not surprisingly, we check the cooperative's records to ensure this price was paid, and 'spot check' with farmers, too.
Welcome to transparently traded coffee!