Agriculture

Costa Rican coffee

How quality pays for farmers

The Costa Rican coffee cooperative ASOPROAAA focuses on producing micro-lot coffee. This commitment to quality coffee enables the farmers that work with ASOPROAAA to achieve higher and more stable incomes.

Cost Rica coffeeCosta Rica is a world-leader in superior quality coffee, producing 1.5 million sacks per year.*

First planted in the country’s lush Central Valley in the late 18th century, the crop is now grown on nearly 100,000 hectares of land by more than 78,000 producers, making it the backbone of the rural economy.

Driven by supportive legislation and institutions, as well as inclusive producer organisation models, Costa Rica has become a global leader in terms of quality and productivity, boasting one of the highest yields and differentials in the coffee industry.

Yield and differential comparison: Selected producers

Costa_Rica_Graphic

Costa Rican coffee growers produce higher yields of quality coffee

Source
Food and Agriculture Oranisation; Twin Trading; responsAbility Research

The average Costa Rican coffee grower produces three times more coffee per hectare and receives more than twice the quality differential of his average Mexican counterpart.

However, many Costa Rican smallholder farmers continue to face obstacles that limit their growth and sources of income.

These include a lack of financing, limited market access and a weak bargaining position. In addition, Costa Rican smallholders – like all coffee growers – are exposed to price volatility in the global coffee market.

Overcoming obstacles

This combination of these factors results in short-term planning horizons and low, unpredictable incomes. Smallholders can overcome these obstacles by joining democratic organisations that provide access to higher and more stable incomes.

rA CoffeeStudy EN

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

One such organisation is the Asociación de Productores Agropecuarios de las Comunidades de Acosta y Aserrí (ASOPROAAA), a responsAbility partner since 2011.

ASOPROAAA was founded in 1998 when several local families came together to support reconstruction after one of the worst hurricanes in recorded history.

Today, the association has 1,271 members, of whom 217 are coffee growers, and is now recognized throughout Costa Rica for the quality of the coffee it exports.

Costa Rica coffee 02

Coffee growing area of Acosta is home to ASOPROAAA

Micro-lot superior quality coffee

What sets ASOPROAAA apart from other coffee associations is its commitment to micro-lot coffee.

Micro-lot production (i.e. the production of coffee on small, exclusive plots of land) is more expensive because it uses higher-quality inputs and the process is more labour intensive.

But the prices that producers receive are so much higher, compensating for the higher costs and giving smallholders a greater sense of pride and ownership for their work.

Cup of excellence award

Costa Rica coffee 04After years of trying to prove that the Acosta and Aserrí provinces produce some of the country’s finest coffee, ASOPROAAA finally won the Cup of Excellence award in 2007.

This marked a turning point for ASOPROAAA’s other coffee-growing members. They were subsequently able to devote plots of their land to producing micro-lot coffee with the confidence that they would receive higher prices at harvest.

ASOPROAAA member Carlos Enrique Monge Fallas is proud of the fruit of his work. The micro-lot that won the “Cup of Excellence” award in 2007 was grown on his land.

While winning the award opened up new opportunities for ASOPROAAA, it was the organisation’s values and work ethic that paved the way for its success.

After 2007, the organisation committed fully to supporting its members’ production of micro-lots based on its belief that this would secure them higher, more stable incomes. By 2014, ASOPROAAA had 60 micro-lots, distributed over 55 producers.

Costa Rica coffee 05

Women find employment in ASOPROAAA’s roasting factories

Looking to invest in the agricultural sector?

Pre-harvest financing

Luis Fernando PradoresponsAbility began working with ASOPROAAA at a time when the association was under massive pressure following a sharp drop in international coffee prices and a management shake-up.

When local lenders were unable to provide ASOPROAAA with the working capital it needed, responsAbility stepped in.

The financing provided through an investment vehicle managed by responsAbility allowed ASOPROAAA to purchase its members’ coffee harvest and to pay them the requisite premiums, thus ensuring it could fulfil its export contracts.

Without the financing, ASOPROAAA’s relationship with its producers and international buyers would have suffered, threatening the economic future of the organization.

Looking for debt financing or equity capital?

Expanding the processing operation

While most ASOPROAAA’s exports are still in the form of green coffee, investments in new roasting machines have led to significant increases in operating revenue over the past couple of years. The revenue share of roasted coffee is expected to continue rising as local sales expand.

Costa Rica coffee 07

ASOPROAAA wants to expand its processing operations

rA CoffeeStudy EN

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

The full case study Costa Rica: How quality pays for coffee farmers is available in PDF format in English, French, German and Spanish.

*The sources for all information mentioned in this article is listed in the below publication

ASOPROAAA: Committed to producing superior quality coffee in Costa Rica