Coffee
 In Forestry and Industrial Crops

In terms of value, coffee is one of the world’s most important commodities.

Coffee is a vital crop for developing countries, providing vital foreign exchange earnings and an income for farmers. It is also an ideal crop for areas with poor infrastructure, as it is one of the few tropical horticultural crop products that can be stored for relatively long periods without perishing.

There are two main species of economic importance: Coffea canephora which produces coffee known commercially as Robusta, and Coffea arabica which produces Arabica.

Coffee is indigenous to the highlands of Ethiopia and the Boma plateau in the Sudan. Here, some 1 300 to 1 800 metres above sea level, coffee trees occur naturally. Today coffee is grown across the world.

Source: Tim Buckland; Schalk Schoeman (ARC-TSC), www.arc.agric.za/arc-itsc/Pages/Coffee-Information.aspx and http://dev.ico.org/documents/eb3603r1e.pdf

Contents

Contents

International business environment
Coffee and Africa
Local business environment
New Farmer Information (advice from two experts)
National strategy
Associations involved
Training and research
Companies involved
Websites and publications

International business environment

There are three main coffee growing regions:

  • Africa/Arabia – Angola, Burundi, Cameroon, Uganda, Ivory Coast, Kenya, Malawi, Nigeria, Rwanda, South Africa, Sudan, Tanzania, Zambia and Zimbabwe
  • Asia – India, Indonesia, Malaysia, Philippines, Sri Lanka and Vietnam
  • Central/South America – Brazil, Colombia, Costa Rica and El Salvador

Brazil, Colombia and Ethiopia are the top Arabica producers, while Vietnam, Brazil and Indonesia are the top Robusta producers. Looking at Arabic and Robusta combined, the top five coffee producing countries are Brazil, Vietnam, Colombia, Indonesia and Ethiopia (USDA, 2020).

Some role players

Links to many role players across the world can be found at www.coffeeresearch.org/links/organizations.htm.

Further reference

Coffee and Africa

  •  African countries import substantial amounts of coffee from Europe (including coffee that was grown in Africa!)
  • Africa’s middle class, currently estimated at around 320 million, already constitutes a substantial market for African coffee. Africa therefore no longer needs to look elsewhere to sell its coffee.
  • The development of an inter-African coffee value should be a great market opportunity for African producers.
  • Coffee will be one of the flagship products to be traded under the African Continental Free Trade Area arrangement. Focus is required on how to attain the sustainable development goals, promotion of domestic consumption, development of capacity among smallholder producers to adopt a more entrepreneurial orientation, and to build, strengthen or help in the establishment of farmer associations or cooperatives.
Source: adapted from www.iaco-oiac.org/en/news/africas-challenge-creating-resilient-and-sustainable-coffee-value-chain

 

Coffee and the Sky-Blue Continent

A KPMG report, Africa Arisen: The Blue-Sky Continent, back in 2014 showed that Africa produced and exported US$6 billion worth of coffee. The coffee was processed outside of the continent and sold for a total of US$100 billion. US$94 billion of the value is thus captured outside the continent.

Local business environment

The South African coffee market has increased at a compound annual growth rate of 13.3% from 556 000 60kg bags in 2014/15 to 809 000 60kg bags in 2017/18 (Insight Survey, 2019).

South Africa imports almost all of its coffee. We do not produce more than 100 tonnes per annum (i.e. 0.4% of what we drink in South Africa). Importing coffee into RSA is currently a potentially lucrative business. When international prices increase, local producers could benefit significantly. However, the coffee trade is fraught with risk.

Although coffee will grow well in almost any frost free area with well drained soil, the best coffee producing areas in South Africa are the coastal areas of Southern KwaZulu-Natal, the Drakensberg escarpment of Mpumalanga, and Limpopo.

Farming coffee and exporting the raw bean is not seen as a viable option in this country, largely because it is a labour-intensive crop. There are, however, a number of farmers who have made coffee a profitable venture (see “Some coffee producers” heading down this page). Despite this, coffee farming looks to remain a smallish cottage industry that will rely on tourism, direct marketing and value adding to fill the necessary gaps.

Coffee, as one of the world’s most important commodities in terms of value, is an industry that could be developed and which could create jobs.

Sources: Tim Buckland; Schalk Schoeman (ARC-TSC) and a project proposal found at http://dev.ico.org/documents/eb3603r1e.pdf

A projected trend in the global consumption of coffee provides a very lucrative opportunity for South Africa to increase the production of coffee beans to meet both domestic and export demand. It is worth noting that some coffee bean producers in South Africa such as Beaver Creek are already exporting to countries like Japan, the United Kingdom (UK), the United States, Denmark and Germany. The potential to extract more value throughout the coffee value chain should continue to be explored by the agricultural sector.

Source: Gilberto Biacuana (see “Websites and publications” heading)

A SWOT analysis:

Strengths

  • The Agricultural Research Council’s Tropical and Subtropical Crops at Nelspruit still has significant capacity to carry out research for the region
  • The ARC-TSC says coffee production creates more jobs than any other subtropical horticultural crop
  • Coffee retail prices in RSA are relatively high. By value adding and marketing the product locally, the crop can still make money even at times when international prices are low due to an oversupply

Weaknesses

  • The raw bean industry is highly labour intensive
  • The low selling price of raw beans and high production costs make it difficult to compete with some third world countries especially in terms of minimum wages

Opportunities

  • South Africa is one of the few countries where coffee can be grown organically. Other coffee producing countries have an array of pests and diseases to cope with, while we are relatively fortunate in that regard.
  • Most of RSA’s population of ±57 million are traditional tea drinkers; active promotion of coffee drinking could potentially be lucrative for many coffee traders, retailers and producers.

Threats

  • The costs of production have increased significantly.
  • Many skills regarding practical coffee production have been lost due to the closure of government farms.
  • The white coffee stemborer (a pest) requires day to day vigilance

For more information, contact Schalk Schoeman at the ARC-TSC (Tropical and Subtropical Crops), 013 753 7000 or schalk [at] arc.agric.za.

Further reference:

New farmer information (advice from two experts)

Because of the high level of technical skills required for this crop, a well co-ordinated larger scale co-operative type of operation above that of small-scale farming is recommended. The chances of this project succeeding would be heightened if it added value by roasting, marketing and distributing the end project.

Source: Tim Buckland (adapted from an email)

Schalk Schoeman’s advice to New Farmers:

  1. Start small and develop a niche market.
  2. Plant rust resistant dwarf or semi dwarf coffee varieties in the right area to cut production costs significantly.
  3. Consider organic coffee.
  4. Plant spacing between the rows should be about 3-3,5m; within the row use single plants ± 1m apart.
  5. Use micro sprayers instead of drip irrigation.
  6. Coffee does well with organic manure (compost and/or kraal manure) from time to time, if this is feasible and available (see #3).
  7. Mulch your coffee from the onset, it will help to conserve water and will increase organic content of soil.
  8. Budget for a tree replacement programme after year 8. Although pruning proves to be very effective, it is time consuming and could be more expensive than replanting.
  9. Start with a stemborer control programme at plant. This insect will give problems and most growers will only notice it after significant damage has already been done.
  10. Value adding of the product on the farm is essential.
  11. For marketing purposes, it is recommended that the coffee to has a “story” – this could be printed in briefly on the back of the container.
  12. Current success stories: see “Some coffee producers” under the companies involved heading.
Contact: Schalk Schoeman at Tel: 013 753 7000 or email schalk [at] arc.agric.za

Further reference:

National strategy and government contact

The Agri Processing Index (API) developed by the Western Cape Department of Agriculture in 2015 ranked the potential of some 130 different products, measuring employment potential, production performance and global market growth.  Roasted Coffee and Coffee Substitutes was at number two on the Top 20 products list, showing the potential of backing this product.

Department of Trade, Industry and Competition (the dtic)

www.thedti.gov.za

Agro-processing is the subsector which enjoys a substantial amount of support from the dtic.

Department of Agriculture, Land Reform and Rural Development (DLRRD)

Food Safety and Quality Assurance

Tel: 012 319 7000

Find the Food Safety and Quality Assurance pages under the Divisions option at www.daff.gov.za.

Associations involved

Speciality Coffee Association of Southern Africa https://scasa.co.za

Training and research

Find the “Coffee training schools” heading in the Speciality Coffee Association of Southern Africa directory at https://scasa.co.za.

  • ARC –Tropical and Subtropical Crops Schalk Schoeman Tel: 013 753 7000 schalk [at] arc.agric.za
  • Ciro Coffee Academy www.ciro.co.za/training Offers Speciality Coffee Association courses
  • PCI Agricultural Services Tel: 072 011 0687  www.pciagri.co.za Plantation crops (includes coffee) training

Companies involved

 

Some coffee producers

NOTE: Producers are mostly involved in the whole value chain, importing, roasting, selling – and serving! – coffee.

Assagay Coffee

Tel: 084 432 6345 / 084 506 2239 www.assagaycoffeefarm.co.za

Operations here include guided tours. Find Assagay Coffee Farm (Professional Media & Marketing) and Assagay Coffee Product of South Africa Part 1 (shibbysnackz) on YouTube.

Austrian Coffee Estate (Mpumalanga)

Tel: 013 764 2897/ 083 306 4908

Beaver Creek Coffee

Tel: 039 311 2347 www.beavercreek.co.za

There are several videos about Beaver Creek Coffee Estate on YouTube. These include:

Jabu Coffee

www.jabucoffee.com

Sabie Valley Coffee

Tel: 013 737 8169 / 082 751 3400  www.sabievalleycoffee.com

This is one grower identified in an SABC news report (2015) who is doing well in an industry that hasn’t really taken off. The key appears to be staff buy-in and all the value adds:

  • Seedlings are produced and sold as ornamental trees to visitors.
  • A gift shop offers “an interesting array of all things coffee”. This includes domestic to industrial coffee dispensing equipment and accessories.
  • In-house barista training is available
  • Coffee tours appointment are arranged

Other YouTube videos are “Sabie Valley Coffee, Mpumalanga, South Africa” (tracyfelmon1) and “Sabie Valley – Coffee Tours” (MMP Online).

Shiloh Estates

wolfgang [at] shilohestates.co.za

See the earlier reference to the Lindi Botha Farmer’s Weekly article “Coffee Farm: creating jobs and making a profit”. Regarding labour, five workers are required for every 2 ha in season, one permanent for every 3 ha throughout the year. Workers are paid per kilogram and are able to achieve the minimum wage “plus 50%” (Botha, 2019).

Thornton Coffee

Tel: 087 700 0225 www.thorntoncoffee.co.za

 

Coffee equipment, roasters, packers, distributors

Further reference:

Websites and publications

Visit the websites listed earlier on this page.

Available on the Department of Agriculture, Land Reform and Rural Development website is “Coffee”, a production guideline. This includes notes on cultivation practices and post-harvest handling.

Call the ARC-TSC at 013 753 7000 or email infotsc [at] arc.agric.za for Production guidelines for Coffee (Anderson T. & Schoeman P.S.)

Order online at www.arc.agric.za, call 012 842 4017 or send an email to stoltze@arc.agric.za for the following publications, available from the ARC Agricultural Engineering: Agro-processingof Industrial Crops (chicory, coffee, sugar cane, tea).

The SADC Secretariat and German Development Corporation‘s Profiling of the Regional Agro-Processing Value Chains in the SADC Region (March 2019) includes a look at coffee.

Insight Survey. 2019. South African Coffee Industry Report. Available at www.insightsurvey.co.za/2019-south-african-coffee-landscape-report

Clowes R (ed.). 2015. Handbook for Sustainable Coffee Production in Malawi. Available at http://imanidevelopment.com/wp-content/uploads/2015/06/Handbook-For-Sustainable-Coffee-Production-In-Malawi.pdf

www.coffeeandhealth.org – “from the institute for scientific information on coffee”

The website www.coffeeresearch.org is “dedicated to advancing coffee quality through education and science”.

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