A message from Caravela Coffee
As we settle into the new reality of work from home and social distancing, the shock of the events is starting to wane and the amount of hard work ahead of us is starting to take shape. Clearly the specialty coffee world has suffered a big blow and structural changes will be needed. As we start to put the pieces back together, all of us will have a part to play in determining what the specialty coffee industry will look like.
This is not to say that we are through the crisis; we are not. Each country, each region, and each locality are all on different curves based on when the outbreak first appeared and the public health measures taken in response. The economic fallout is severe, that we know, but economic recovery will only follow public health security, and that is dependent on the actions and policies of local leaders throughout the world.
What does this mean? It means the way forward will be complicated and chaotic.
It means that it will take a lot of effort to fully understand the challenges that we face, and clear communication when sharing those challenges with all stakeholders. It also means that we must adapt rapidly to the new reality, looking for new growth opportunities and finding efficiencies, but without sacrificing our principles and purpose. And we must never forget the most vulnerable part of the coffee value chain: the small coffee growers. Without them, nobody will endure. Finally, we must celebrate the small victories and be creative in approaching how to solve our common problems. So that is what we will do, and we will come out stronger because of this.
The Relationship Building team, which is usually travelling to farms with roasters to develop close relationships between roasters and producers, continues to work from home.
Now, more than ever, those relationships need to be kept alive and strong. Therefore, they are organizing a live weekly farm tour via the @caravelacoffee Instagram account on Thursdays at 12:00 PM EST/6PM CET. In these times when traveling isn’t an option, these livestreams bring coffee farms closer for everyone interested, including end consumers. You can see what a coffee farm looks like, learn about what they are doing, and have your questions answered by a coffee producer. If you’d like to reach out to one of the producers that you are working with, our Relationship building team can also help out.
The Origin Compass podcast, produced by our Relationship Building team, returns in its second season with monthly episodes focusing on what’s happening in the coffee value chain. This month’s episode is called Minga From Field to Filter: Coffee Reacts and Adapts to the COVID Era . We encourage you listen it here or in your favorite podcast platform.
With most cafes closed or doing only take-away service, the new dynamic of the specialty coffee industry relies mainly on the Direct-to-Consumer market.
So last week we launched an initiative that we have named Good is Brewing . This initiative aims to support coffee roasters around the world that have sourced coffee from Caravela and are selling it in their web shops. We hope that by helping consumers find great coffees we can also help sustain the livelihoods of the more than 4,000 coffee growers that count on us all. Please let us know if you have a coffee from Caravela available for sale online that you would like to include in this list.
Our import offices continue to operate on a work-from-home basis, with essential quality duties performed in isolation at our quality laboratories.
Destination warehouses continue to do an impressive job of maintaining normal service levels for both inbound and outbound traffic while addressing health and safety concerns via split shifts, additional sanitation procedures, and work-from-home policies. Shipping lines have reduced their sailings, particularly along east-west and west-east routes so we are experiencing longer transit times from all origins to all destinations.
As you will see below in the origin country breakdowns, we have expedited exports when and wherever we can, in order to have as much inventory as possible on hand and in a spot position at our destination warehouses in Australia, North America, Taiwan and the UK.
We are moving with added urgency to address potential supply risks, but also to provide more options for roasters. When there is so much uncertainty regarding supply as well as demand, know that we have coffee on hand as roasting businesses get back on their feet. If you have any questions or want to consult with us regarding a coffee supply plan, please don’t hesitate to contact our sales teams.
Below is an update on the situation from each origin where we operate:
A government mandated lockdown which has been in effect since March 25 has been extended until May 11th.
Coffee farmers have started pre-harvest activities and early pickings for the current first-semester harvest. As coffee has been declared essential, most of our purchasing warehouses and cupping labs in Huila and Tolima are open, receiving parchment from producers. Most regions report that the harvest is only just beginning, with less than 10% harvested so far. The most pressing challenge as the harvest progresses will be having enough pickers to harvest given current government restrictions on movement and some even tougher movement restrictions in certain important coffee municipalities. Most of the farmers that we work with are trying to collaborate with their neighbors and implement community harvesting, as well as relying more on family labor. Despite these efforts, some regions with a substantial harvest this time of the year, such as Planadas (Tolima), will most likely face a shortage of pickers if these restrictions are not lifted promptly. If there are indeed labor shortages, quality will likely suffer as most growers will encourage strip picking instead of selective picking to avoid cherries falling to the ground and losing precious volume.
The dry mill in Armenia resumed operations last week after a two-week hiatus, albeit at a slower pace than normal as there is not much coffee available. We are expecting parchment deliveries to increase in May as the harvest progresses, and shipments to start picking up pace in June.
Despite the country being in lockdown since March 17, we managed to ship the last containers from Galapagos and mainland Ecuador the last week of March. Lockdown orders and a curfew from 2 PM to 5 AM are currently in effect until April 26. The harvest is about to start in earnest, PECA is now hosting virtual and remote workshops to prepare for the coming harvest. So far, farmers report current harvest completion rates of under 5% in the North and under 3% in the South. We expect to resume normal operations by the second half of May, once first batches of coffee start being dried and delivered for analysis.
The government in El Salvador has been very rigid on restrictions and the actions taken so far. A curfew and a very strict stay-at-home order are currently in effect until at least April 28. It has been very difficult for both citizens and companies during this crisis. Even if agriculture has some exemptions, strict permission requirements concerning transit have complicated the way of operating. Currently we have been able to secure the Caravela team and help them through the crisis, with some working remotely from home.
Milling started after Easter and we have been able to schedule millings at full speed with non-stop production until end of May to allow our partners to receive their coffees on time. We expect first shipments to be afloat by the end of April. The Quality team has been planning and supporting the milling and quality assurance processes. PECA has been focused on closing the harvest: obtaining full details to provide feedback to farmers and working closely with them, via phone calls, to start to prepare for the next harvest.
Restrictions continue in Guatemala until at least April 27th; the government is reviewing on a weekly basis whether to extend it or slowly remove them. The curfew in place has been relaxed a bit starting today, and now begins at 6 PM (instead of 4PM) and is in effect until 4AM. The strict restriction on movement is now exclusive to Guatemala City and its surrounding departments. Public transportation is still suspended, which makes it difficult for workers to move or get to their jobs.
PECA is working closely from home by following up through calls to producers. They are completing the harvest reports to be able to follow up on recommendations with farmers for the new harvest. The Quality team is divided between quality assurance, milling, and our main warehouse to ensure parchment is milled on time and to specs. Lastly, the Logistics team is on top of every single movement and they continue working hard on milling and exporting coffee. We are planning our last exports by the end of May.
The situation in Mexico remains calm although the number of cases is on the rise and more measures are being taken by local governments, however there is no obligatory order to quarantine. Ports remain open and functioning, albeit slower than normal as many people are working from home. Parchment purchasing has finished in Chiapas, but we continue purchasing coffee in Oaxaca as some growers, especially those at the highest altitudes, still have coffee available to sell. Most communities have closed their borders to prevent the virus coming to these very fragile communities, limiting any movement in and out but we are working closely with the community leaders to allow producers to deliver parchment to our warehouses in Miahuatlan and Oaxaca City.
We have started milling coffee and will do our best to move as fast as possible. At this point in time we expect to finish exporting coffee in the first half of June. With regards to next year’s crop, we have seen the first flowering in both Chiapas and Oaxaca and are anxiously awaiting the arrival of the rainy season.
Our operation in Nicaragua continues to cup, mill, and export coffee.. Since Easter, 90% of the PECA team has been working from home, providing remote and personalized technical assistance to the more than 130 producers we work with. The logistics and production teams are working double shifts to speed up the milling process. The entire management team has been working at home for 3 weeks so far, and only essential personnel continue to work on site using PPE and following social distancing guidelines.
By the end of April, 80% of the contracted volume will be shipped and we expect to finish exports by end of May. The shipment of some coffees has been pushed forward due to the persistent uncertainty in Nicaragua and the specter of the virus spreading uncontrolled, shutting down the whole country. Even though the country ostensibly continues to operate without disruption, government authorities, customs agencies and ports are working on reduced hours and with fewer staff.
The Peruvian government has extended the lockdown until April 26th. PECA and quality teams are continuously giving support to producers through calls and to ensure their infrastructure plan for the upcoming harvest is in place. Harvesting in the regions where we source coffee is scheduled to begin in the middle of May, so we expect to start purchasing coffee in early June. We have our three purchasing units in Jaen, San Ignacio and Quillabamba ready to open as soon as the lock-down is lifted. As of today, moving parchment from farms to cities is restricted in most of the provinces, as the government has yet to classify coffee as an ‘essential’ product.
Local authorities, army, police and health ministry representatives from coffee provinces have created a task force that includes all coffee companies. The objective is to collaborate on creating the guidelines/protocols to begin the coffee harvest while guaranteeing the safety of all the people involved, avoiding the stagnation of the economy and protecting income for thousands of producers. We are part of the task force, and our team members have been participating in all the meetings, sharing our recommendations and our own protocols. The final document will be submitted next week to the regional governments for approval.
Thank you for your continued trust. We will continue working hard to keep great coffee flowing, and to ensure that the relationships forged throughout our twenty years will come out stronger after the storm has passed.