STiR coffee and tea magazine

STiR coffee and tea 19 Trustworthy advising ... Use our knowledge to your benefit. With our outstanding experience in tea buying and blend development, we offer you high-quality teas, sophisticated formulations and latest tea innovations. Independently. Personally. Since 1992. Get an impression of us: www.kktee.de Le Duc Huy, CEO of Simexco (middle) surveys the 2024 fall coffee harvest with Tran Phi Hung, Simexco's director of quality management (left) and Nguyen Tien Dung (right), Simexco's director of sustainable agriculture development. Photo courtesy Simexco Between 1993 and 2001, Vietnam went from producing 2 mil- lion bags of coffee a year to 15 million. According to a report by Revista Envio, the amount of acreage under coffee cultivation ex- panded from 155,000 hectares in 1995 to 550,000 hectares in 2001. "Since 1996, an estimated 400,000 people migrated to Da- klak [the main coffee growing region] to benefit from the cof- fee boom," the report states. "More than 120,000 hectares were burned and cleared to make way for new coffee plantations. The coffee tree was now called the 'dollar tree.'" During this time, Vietnam surpassed Colombia as the world's second-largest coffee producer. However, such a rapid influx of coffee in the market created a massive global oversup- ply, and prices plummeted. "Global robusta prices hit the bottom end in 2001/2002," Le Duc Huy, CEO of Simexco Daklak, told STiR. "The crisis occurred just as we achieved 16 million bags. That's when Viet- nam realized that volume is not a sustainable goal. If we keep producing huge quantities of coffee, we'll only ever get cheap prices. So we asked ourselves, 'How can we make this industry more sustainable?' and then we looked to Europe and the coffee buyers to investigate and learn." A Valuable Lesson: the Necessity of Sustainability It wasn't just plummeting prices that motivated the coffee sec- tor to consider sustainability. The environmental aftereffects of Vietnam's 'coffee boom' were devastating. "The destruction of forests, rapid expansion of coffee culti- vation, and intensive irrigation practices led to soil erosion and serious water shortages," reports Revista Envio. "Natural rivers and estuaries ran dry, and underground water levels dropped. When drought struck in 1998, 200 reservoirs dried up, and underground water supplies were over-exploited. During the drought, it was estimated that 90% of families in Daklak did not have access to sufficient water. As water prices rose by 25%, small farming families lost over 70,000 hectares of coffee trees." Simexco Daklak, a state-owned company founded in 1993, was one of the first Vietnamese coffee companies to take pro- gressive measures toward sustainability. Simexco purchases green beans directly from the farmers and the Simexco Daklak range exports 1.3 to 2 million bags annually. Since 2009, Simexco has prioritized sustainability in green coffee production, adopting 4C certification in 2010, initially benefiting 2,300 farmers. This effort expanded with Rainforest Alliance certification in 2012, Fairtrade in 2014, and the imple- mentation of 30 sustainability projects onwards. "Before, we were taught only to do business for profit," ex- plains Huy. "But now we understand that sustainability in the coffee trees impacts the environment, economy, and the social aspect. Currently, we work with 40,000 farmers over 50,000 hectares to build a sustainable landscape to protect the land, the soil, and the air by reducing chemical usage, practicing water conservation, planting shade trees, and introducing crop diversi- ty. Now, the farmers feel proud and respected and are motivated to work together with Simexco for better coffee quality, a better future, and better value for the Vietnamese coffee industry."

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