By Christine Nunag

Coffee is hotter than ever. It is now the most popular beverage next to water, with demand projected to keep rising in the next coming years. In a single weekend, Manila’s busiest malls, according to Philippine Coffee Board Co-Chairman Nicholas Matti, sell about 120,000 cups of coffee. Sadly, much of the coffee is imported from other countries such as Vietnam. Despite President Gloria Macapagal-Arroyo’s 2002 directive to revive the local coffee industry, certain truths remain—we don’t have enough coffee, and we don’t have enough people growing it.

How then do we get the farmers back to the field? Is the P3 billion supply shortfall enough to make them return? Which production formula or processing system works best for us? Will we be able to create a new generation of farmers? To address these all-important issues, Specialized Trade Marketing, Inc. (STRAM) in cooperation with the Department of Agriculture organized Philippine Coffee: A Perfect Brew, the national coffee forum and trade fair. On May 24, 2007, farmers, coffee traders, and industry members from the Cordillera highlands, the lowlands of Luzon, Visayas and Mindanao convened at the Philippine Trade Training Center in an effort to move the ailing industry forward.

What’s in it for us?

Encouraging the farmer to go back to the coffee field is a tough feat. A vast majority of our farmers suffered great losses from the infamous price drop of the late 1990s. Vietnam, which used to produce a mere 10,000 metric tons of coffee in the 80s, shot to the top with a whopping one million metric tons in 1999. That, together with massive production in Brazil, caused price levels to plummet from US$3500/MT FOB to a mere US$400/MT FOB between 1997-2002. On top of rising competition brought about by free trade, the lifting of import quotas, the entry of competitively priced and high-quality coffee from veteran players such as Colombia, and the arrival of Indonesia in the market, the Philippine farmer has to deal with local factors affecting production. These are higher production costs, peace and order situation, loss of lands to industrialization, and extreme weather changes. To all these, Matti adds his personal observation: “Our farmers are old, the coffee trees older. We have lost a whole generation of farmers to more glamorous careers such as call centers.” But as far as industry movers are concerned, hope in getting our farmers back to the fields is not lost.

Read the full article in the November-December issue of F&B World Magazine