The prospects for coffee production look strong in Papua New Guinea, according to Joeri Kalwij, Manager of Monpi Coffee Exports, one of PNG’S major coffee exporters. In particular, the 2016 result of one million exported bags was impressive. He says that the industry is likely to average 800,000 bags a year. If the industry can achieve that ‘we’ll be doing well,’ he says.
PNG is among the world’s top 20 coffee producers, and boasts the ideal environment: excellent soil, rainfall and the right climate.
But there could be greater upside. Kalwij believes that if training is improved, the trees are upgraded, mills improved and the bottlenecks at ports—which are due to lengthy and complex export bureaucracy—are removed, then the industry could be doing much better.
‘People will stand in line to buy a cup of PNG coffee—if it’s marketed as PNG coffee. PNG can cater for all ends of the spectrum: high-end specialty and a solid quality bulk volume.
‘We will never be a Brazil or a Vietnam. But do we need to be? We can create specialty coffees. We can create quality by being more hands-on with the farmers.’ Investing Major trade and development organisation Fairtrade Australia and New Zealand works with over 6000 coffee farmers in Papua New Guinea, including the 2600-member Highlands Organic Agricultural Cooperative (HOAC).
The Cooperative is investing into improving local infrastructure and bucking local trends, with production increasing by 350 per cent over the last 10 years.
Fairtrade Australia and New Zealand CEO, Molly Harriss Olson, tells Business Advantage PNG that some of the country’s rural infrastructure, such as roads and bridges, has deteriorated, limiting ‘access to many of the ideal coffee growing regions.’
Delays in transport also affect the quality of coffee, which reduces the price that can be charged, she says. Mobilising farmers The Coffee Industry Corporation has implemented a strategy of mobilising farmers into groups in an attempt to address farmers’ concerns about low prices.
Tom Kukhang, the Coffee Industry Corporation’s Chief Scientist, says if farmers work together, the consistency of the crop will improve. It is a strategy that provides the growers with larger crop volumes, putting them in a stronger position to negotiate the sale price with the exporter.
‘When they go as individuals to the roadside or market to
WE WILL NEVER BE A BRAZIL OR A VIETNAM. BUT DO WE NEED TO BE?
sell their coffee, they have no power,’ says Kukhang.
Eventually, he says, the grower co-ops will allow the farmers to deal directly with small roasters throughout the world, removing the ‘middle man’. Export bureaucracy Kalwij praises the US$50 million World Bank–funded Productive Partnerships in Agriculture project (PPAP), which trains farmers and aims to rehabilitate ageing trees. But he says some of that money could be directed towards improving the export process.
‘We need to do away with the problems in getting export documents ready. If we could achieve this, the exporters would buy more and we could export more.’
Kalwij likewise points to the need for better training. ‘It’s a negative vicious circle with regards to quality.’ He notes that quality standards are often not observed. Some coffee may be under-grade, or may be from past crops. ‘We are devaluing our coffee,’ he says.
‘A bucket of random cherries at a random wet mill will be any colour, from green to dark red and everything in between. Why don’t mills reject unripe beans? Why don’t we train coffee growers better?’
Kalwij says infrastructure also needs to be improved. ‘The decline in infrastructure and services can be seen when a road is washed away, or a bridge has collapsed in the more remote areas.
‘It doesn’t get fixed in the same season. That means that a lot of farmers who grow coffee have a harder time bringing their coffee to market.’ Future demand Fairtrade’s Harriss Olson believes demand for coffee is growing across the globe. ‘It’s projected that by 2020, Australians will be drinking 4.5 billion cups of coffee each year.
‘This growth in demand, coupled with PNG’S close proximity to Australia, provides a tremendous opportunity for PNG coffee growers,’ she says.
Kalwij says PNG currently provides about one per cent of the global coffee output and is unlikely to reach double digits. But he believes there is no need to compete with the bigger nations. Rather, the approach should be to aim at a distinctive niche.