How to make good strong coffee
Good things are brewing again for the Philippine coffee industry
Something more than just dark, rich soothing liquid is a-brewing in that hot cup of coffee you’re sipping at the moment. If plans and present efforts aimed at rehabilitating Philippine coffee are realized unhampered, something akin to a revival of a once-major industry might just happen.
Two centuries ago, in the late 1800s, the Philippines was once the fourth-largest exporter of coffee in the world. The first coffee beans were brought to the country by Spanish friars in 1740 and the first areas where these were planted were in Lipa, Batangas, according to Dr. Alejandro Mojica, research director at Cavite State University, a member of the Philippine Coffee Board (PCB) and the country’s leading authority on coffee. By the 1880s, the Philippines was a major coffee exporter. However, coffee rust, a disease that spread worldwide at around that period, crept into the Philippines and devastated almost all of the coffee trees—then mainly Arabica—in the country.
Negros Occidental farmer Nicholas Matti, current cochairman of the PCB, explains that something akin to a Dark Age descended on Philippine coffee for a long period.
“It wasn’t until the 1970s when there was a resurgence in Philippine coffee,” Matti said. “Over half a century earlier, there had been a replanting of Robusta mainly, and some Liberica [or barako], Excelsa and Arabica in the country.”
Most of the coffee planted in the country during the Spanish era was Arabica, and when the worldwide infestation occurred in the 1880s, the Arabica coffee trees in the Philippines were virtually wiped out, except those planted in altitudes of 5,000 feet above sea level. Today, most of the Arabica coffee in the country can be found in Benguet, the Cordilleras and other upland areas in Northern Luzon.
In the 1950s, after World War II, instant coffee made the scene in the country, with Nestlé bringing in Robusta, which the world’s largest food company needed for its instant-coffee product, Nescafé. Again, Cavite was among the first producers of Robusta. Favorable market conditions resulted in more farmers using their land for growing coffee.
Philippine coffee farmers had good reason for planting the bean up until the 1980s. Matti pointed out that some two decades ago, the country was producing up to over 70,000 tons a year. “The country then was consuming about 35,000 tons of coffee, and we had from 35,000 tons up to close to 40,000 tons of coffee for export annually,” Matti said, adding that there was even “a banner year in 1989, when the Philippines exported about $150 million worth of coffee.”
Quota system
The country, which was a member of the International Coffee Organization (ICO), also enjoyed healthy prices for its coffee exports, which was regulated by a quota system set by the ICO. “We had a quota there, and that quota served as a price mechanism and, until 1989, coffee prices on the average were about $2,000 to $3,000 a ton,” explained Matti.
However, the US withdrew from the quota system and, after its withdrawal in 1989, coffee prices dropped to less than $1,000 and had been steadily going down ever since. This drastically affected production, with Philippine coffee farmers turning to other crops because of low prices for coffee. There was some sort of recovery in the mid-1990s, but in 1997 Vietnam started producing coffee in serious numbers.
Recalled Matti: “In 1997, 1998, for instance, the price for a ton of Robusta was $3,500 to $4,000. By 2002, the price plunged down to $400, so within a period of five years, coffee in the world market lost as much as 90 percent of its value.”
The ICO pointed a finger at Vietnam, by then a growing formidable national-producer entity where world coffee is concerned, as the culprit, blaming it for the debacle in the world price for coffee after the country dumped something like 800,000 metric tons of coffee in the world market, consequently causing prices of the commodity to fall way below production costs.
Vietnam, in 1989, produced some 10,000 tons of coffee. By 1997 the amount increased to as much as 300,000 tons, and by 2002 it jumped to over a million tons. This year, Matti said, in a tone which seemingly combined envy and frustration, the Vietnamese will hit 1.3 million tons of coffee “easily.”
Some 90 percent of total coffee produced by Vietnam is Robusta, and the rest Arabica. This dire situation, he underlined, “practically wiped out such Robusta-producing countries like Thailand, Laos and Indonesia. These countries, the entire Southeast Asian region, in fact, possibly with the exception of Thailand, along with the US, Japan, Western and Eastern Europe, practically the whole world, are all now customers of Vietnam.”
By 2002, when the PCB was organized, the country’s total coffee production was down to 23,000 tons. “We lost some 50,000 tons,” said Matti, who has been PCB cochairman since its inception, “and some of the efforts we’ve done since have helped to increase production to 30,000 tons at present.”
Local demand
The country’s current total production is not enough to satisfy local demand for coffee, which is about 60,000 tons annually, and it is sad to know that Filipino coffee drinkers are paying P3 billion to such countries as Vietnam, where most of its 30,000 tons of coffee imports come from every year.
Low prices for coffee have caused a shrinkage in agricultural land planted to coffee. Such towns in Cavite as Amadeo, for instance, where as much as 4,000 hectares used to be planted to coffee by farmers since the 1880s, now only has half that area planted with coffee trees. Since the creation of the PCB in 2002, Amadeo has been used as some kind of guidepost for the board’s aim to reinvigorate over 20,000 hectares of coffee farms in over 20 provinces nationwide.
Earlier after its organization in May 2002, the PCB began extending technical assistance and giving credit programs for coffee farms, and partnered with such institutions as Cavite State University, the Department of Trade and Industry-International Coffee Organization Certifying Agency and the Quedan and Rural Credit Guarantee Corp. in conducting research and training and credit programs for the coffee industry.
A marketing and promotional program for local ground, roasted and instant coffee, branded Kape Isla, which also serves as a seal of quality for Philippine coffee, was undertaken. Also, in addition to the Pahimis coffee festival held every October in Amadeo, the PCB started to put up its Coffee Break festival, which is held in a Makati mall annually.
Over the seven-year period since the PCB was created, some outstanding results were pointed to by current PCB members. Former Cavite councilor and PCB member Rene Tongson, for instance, gave the case of coffee brand Café Amadeo, which, from a measly “P20,000 to P30,000 sales in 2004, now makes P800,000 monthly sales on ground coffee. October through December, they gross up to P3 million and there was even a time when they made P8 million!”
For her part, entrepreneur Pacita Juan who, along with Matti, cochairs the PCB as well as heads the Pilipinas Gumising at Magkape project, told of another brand, Siete Barako, whose supermarket sales of coffee “has been increasing by 25 percent annually; and take note: This is from Kalinga, this is Kalinga brew!”
Self-sufficiency
Other than the PCB’s targets, which include the rehabilitation and rejuvenation of over a total of 20,000 hectares of coffee farms in over 20 provinces nationwide and expand coffee production to over 20,000 hectares, creating thousands of new jobs in the process, the board’s major current challenge is to become self-sufficient in coffee—meaning, no more importation of the product to meet current demand from Vietnam and elsewhere—by 2015.
In October 2008, the PCB met with the Department of Agriculture (DA), which wanted to have a situationer on the local coffee industry.
“We gave them a report and also a plan and program of action, and the DA told us, go ahead and implement it and we [the DA] will give assistance to the program, which basically includes the continuing rehabilitation, rejuvenation and planting of new coffee trees to as many areas as possible,” related Juan. “The program [of action] is called Pilipinas Gumising at Magkape. It’s literally waking up the farmers and encouraging them to grow coffee. Since the country is divided into 23 coffee-growing areas, it will be a difficult task not to have concentrated people in there. So we have a core group and we divided the country and appointed area directors per area.”
The area directors include Matti, who is in charge of the Visayas (Negros Occidental and Panay); Dr. Mojica and Tongson, who are area directors for South and Central Luzon or mainly the Robusta coffee areas; coffee roaster and entrepreneur Emmanuel Torrejon who, because of his expertise and experience with Arabica, was given the Northern Luzon area (including Benguet, Mountain Province, Bontoc, Kalinga, Ifugao and the Cordilleras), and two others for Mindanao.
The end objective is to get local production to grow from its current 30,000 to as much as 75,000 metric tons within a six-year time frame. It is a lot of work, but there are indications that are more than encouraging for farmers to go back to the land and plant coffee.
The PCB members say the markets for coffee are definitely there, and the Philippines has an advantage of being one of the few countries in the world at present that produces all four varieties of commercially viable coffee varieties—Robusta, Arabica, Excelsa and Liberica.
“The Japanese market for Liberica alone is huge,” pointed out Mojica, “with Japan making inquiries from Cavite coffee growers if it is possible for them to import at least 5 tons a month. But the most the growers can come up with is only 1.2 tons a year. Canada, too, is asking us about Liberica.”
Matti, likewise, related that the PCB is now being approached by a growing number of people who have small tracts of land in the lowlands and are asking if they could grow coffee in there. “We encourage them to grow Liberica and Excelsa because these can be done in low areas and there is a market for these kinds of coffee,” he said.
“Liberica and Excelsa comprise only 1 percent of world consumption, but that 1 percent is identified. It’s here in the Philippines, it’s in Malaysia, in Indonesia and the Middle East. We know where the market is. And there is a market for all four kinds of coffee that are grown here.”
I haven’t even yet told him about a Finnish acquaintance of mine who told me that there is real growing interest in Finland about Philippine coffee, and if he could get his hands on a constant ample supply, is ready and willing to import tons and tons of Liberica and all other local-grown coffees he could get his hands on immediately.
Written by Teodoro Y. Montelibano / Special Reports Editor
Source: Business Mirror
