Western Guatemala Highlands: Introducing New Models for Sustainable Development in the Coffee Agricultural Value Chain
According to Guatemala's Asociación Nacional del Café (Anacafé), coffee is the fourth most-consumed beverage worldwide and the second most-traded good in the world. It is estimated that 2.3 million cups of coffee are drunk per minute around the globe.
Guatemala is well-known for its coffee quality and the unique characteristics of each blend, depending on production region. This has consistently placed it as a top market focus for consumers, roasters and importers alike. The coffee sector has contributed enormously to social and economic development as one of the country's most-exported goods, so much so that in 2018, the Ministry of Culture and Sports of Guatemala declared coffee as a “Cultural Intangible Heritage of the Nation.”
Coffee is one of the most iconic products of Guatemala. The Western Highlands is a well-known region of coffee production (Huehuetenango and San Marcos in particular), and coffee's potential to strengthen Guatemala’s position across international markets holds great promise.
Projects and partnerships
The Guatemala Innovative Solutions for Agricultural Value Chains Project — which is supported by USAID as part of Feed the Future and the U.S. Government’s Global Hunger and Food Security Initiative and is implemented by Agropecuaria Popoyán, S.A. — aims to reduce poverty and chronic malnutrition, while also creating economic opportunities to avoid illegal immigration in the Western Highlands of Guatemala. The strategy is to build partnerships with the private sector under a shared value model that focuses on innovative technologies for smallholder farmers. This then promotes modern agriculture and integrated development in the economic-potential corridors identified in this region.
The private sector plays a key role in bringing prosperity to rural areas. Whether these private players are individuals or multinational companies, they all bring development, employment, direct investment, education and health opportunity to inhabitants where they work, contributing profoundly to the country’s economy. The Guatemala Innovative Solutions for Agricultural Value Chains Project (the Project), in particular, offers different options to make sustainable impact in the Western Highlands.
One of the most-relevant mechanisms available is ProCompite, an investment fund based on a shared value model, created to promote private investment and to mitigate risks across the region. Additionally, the memorandum of understanding (MOU) allows for joint work among specific projects and objectives that are led by the private sector and/or smallholder farmer organizations. The project works strategically under both ProCompite and the MOU for the overall betterment of the coffee sector. The main goals are: 1) To improve productivity and quality and develop commercial and competitive capacities of the private sector and smallholder farmers, and 2) To increase their income and improve their quality of life. The following are three stories of private sector partners that apply different models, but with a common goal: to bring sustainable growth to smallholder farmers and their families.
Shared value model: Focus on gender equality and youth in the coffee value chain
On May 2018, the Asociación Barillense de Agricultores (ASOBAGRI) became a partner to the Project through the first call for applications under the ProCompite co-investment fund. This organization was founded in 1986 and is based in Santa Cruz Barillas, Huehuetenangom, and is known for its quality production processes and social and environmentally responsible practices — thus meeting the highest demands of foreign markets such as the United States, Canada, Japan, Europe and Oceania. ASOBAGRI has more than 1,500 smallholder organic coffee farmers and holds both Bird Friendly and Fairtrade certified accounts.
The partnership between the Project and ASOBAGRI aims to increase productivity and commercial capacities and improve production and processing facilities, while also supporting climate change resilient initiatives (among others). But the most distinguishing factor is the focus on increasing women and youth economic opportunities among their value chain, under co-investment efforts. ASOBAGRI promotes a culture of gender equality and generational inclusion through their “Women’s Coffee” and “Innovative Youth” coffee brands. At present, they have 325 women smallholder farmers (22 percent of total members), and 153 young smallholder farmers (11 percent of total membership).
The ProCompite subcontract with ASOBAGRI outlines a strategic plan for two programs. The first one is the “Young Entrepreneurs Program,” which aims to enhance generational leadership through new commercial and production opportunities and technical and professional training options. This program has been essential to help mitigate illegal immigration by creating more local economic opportunities. It has also led to the creation of the Young Entrepreneurship Office and the General Assembly of the Youth. These spaces have allowed young farmers to be empowered and participate actively in the decision-making process at the organization. They are fully committed to the development of their own communities and the future of ASOBAGRI. Some highlights from this program include: a trade promotion strategy for Café Vivaz (a coffee brand from young farmers) at the national and international level; knowledge transfer of agricultural best practices to the youth; roasting and cupping trainings and inclusion of young farmers into key leadership roles among the Board of Directors and other positions within their communities. By 2021, this program will add 107 new young farmers to the current membership, which means at least 17 percent of ASOBAGRI’s membership will include young farmers.
As noted earlier, Santa Cruz Barillas has faced high emigration rates over the years, mainly among men and young men. Women tend to stay in their communities and remain as the main leads of the coffee parcels as a way to earn income. That is why being part of a greater community is key to empowering women and to improving the economic opportunities and knowledge about agricultural practices. The second program under this partnership is called Governance and Women’s Leadership Program. Its purpose is to increase the number of female farmer members and to offer a commercial platform for their coffee products that helps improve their quality of life and that of their families. As a result, the Women’s Office was created to implement important initiatives, such as technical assistance to improve productivity of women’s plots; training programs regarding leadership, entrepreneurship and technical skills; trade promotion of the Café Dueñas coffee brand (women farmers coffee); and inclusion of women in leadership roles in the organization (among others). By 2021, ASOBAGRI will have at least 105 new women farmer members, increasing female representation within the organization to 43 percent.
These two programs pave the way for sustainable development in many communities in Huehuetenango and Quiché. And at the same time, it strengthens the coffee value chain and offers a growth platform to those who have been traditionally disadvantaged.
Specialty coffees: Alliance for all, model of excellence
In 1963, ROSMA Coffee Land was founded by Alejandro Morales as a family business in San Pedro Necta, Huehuetenango. In the 1980s, this land began to grow into what would become ROSMA Farm, which Fredy Milton Morales built in honor of his wife, Rosa María. Despite facing many challenges, such as lack of roads and water scarcity, ROSMA Farm and the community built the first road to transport their products out of their farms and plots. This allowed for an ecological wet mill for sustainable use of water and conservation of natural resources; this mill became key to the modernized processing of specialty coffee. Soil conservation and biodiversity in the production site is highly important, as is organic material production to enrich the soil; the coffee plantations are also surrounded by different native trees (which provide necessary shade).
Today, Fredy Morales' children, Fredy and Alejandro, run ROSMA Farm. They have also expanded the business model to implement new projects. For instance, ROSMA Farm has participated in the Cup of Excellence competition since 2000. This was the result of more than 10 years of hard work to improve quality and create exquisite and unique coffees to reach the demanding standards. As of 2020, ROSMA Farm was awarded the second place of the electronic bid of the Anacafé Cup of Excellence, due to its high quality. These competitions have been important in building a strong reputation as providers of the best quality coffee in international markets and for the growth of the business.
ROSMA Farm stands out for its commitment to both the community and smallholder farmers. Its reputation has allowed it to represent many groups of smallholder coffee farmers who also need a platform to offer their quality products. Buena Vista is the first community in San Pedro Necta, Huehuetenango, that is part of ROSMA Farm’s social responsibility program. The farm introduces and promotes smallholder farmer’s coffees to international buyers, improving their trade prospects. In addition, there are ongoing trainings and technical assistance to improve coffee production and processing. These efforts have benefited over 200 families in different communities across the region.
The Project and ROSMA Farm have a partnership through an MOU to implement demonstrative coffee plots to learn about highly productive and rust resistant coffee varieties. There is also a program called “Benefit 1:1,” where smallholder farmers receive one additional coffee plant for each one they buy. While ROSMA Farm offers the training and technical assistance and finances the additional plants, coffee farmers can replicate new technologies and improve productivity levels to access more and better prospects in international markets.
Today, ROSMA Farm is known for sustainable coffee production, considering two basic criteria: environmental responsibility in crop management and social responsibility with smallholder farmers who work with them.
Shared value model: Working toward a new coffee market based on direct trade
It has been many years since coffee prices saw record highs across the global market — Guatemalan farms still talk about the times when that business was highly profitable. Now, however, the world market is saturated with coffee from many different countries, and the story is quite different. Coffee is a commodity traded on the international stock markets, which strictly defines prices without considering the labor and efforts of small farmers, whose worth is well beyond a dollar figure.
What should be done with these current market challenges? They call for creative, alternative models and new solutions, identifying other actors who also want to trade outside such markets. There are many potential partners with shared visions willing to pay fair prices for coffee, but it is not an easy process.
Since commodity coffee prices are not disappearing any time soon, the key is to focus on the differentiation of coffee production, to help distinguish which ones stand out from the rest. There are no magic formulas to follow, just an individualized approach and analysis of each coffee farmer and his/her crop, identifying strengths and weaknesses and then implementing improvements. MOVER Soluciones en Café does just that. The company offers technical assistance and commercial advice to smallholder farmers to differentiate their coffee in a landscape crowded with similar products. When the coffee is ready, MOVER connects farmers to the national and international markets.
The Project and MOVER Soluciones en Café partnered in October 2019 to improve productivity and quality of coffee smallholder farmers from San Marcos, to strengthen their commercial and competitive capacities to seize business opportunities and to improve their income and quality of life. The partnership was created under an MOU and included co-investment in mobile technical equipment. The goal was to directly measure the soil moisture, temperature, PH levels and Brix in coffee parcels. This dynamic allows a better diagnosis, allows smallholder farmers to learn about improvements that can be made and, most importantly, to show them results onsite. This model has allowed a new space for learning, empowerment, communication and transparency between production and commercialization of coffee.
At present, MOVER Soluciones en Café works with Cooperativa CIAMUJESCA in Tajumulco, San Marcos. This cooperative represents 20 women smallholder farmers, each with their own coffee parcel and a small coffee mill. Their story is outstanding and unique, and their coffees are exceptional, loaded with great flavors and a sense of community and hard work. These female farmers are also working with a customized improvement plan, so that by 2021, they will be able to directly export for the first time with no middlemen. MOVER is excited to add other coffee cooperatives and associations to their client base, as they help provide a platform for coffees in the Guatemalan Western Highlands that tell a story of hope, opportunity, community roots and prosperity.
These are just a few of the success stories in this region, with hopefully many more to follow.