STiR coffee and tea magazine

STiR coffee and tea 43 Specialty coffee shops and cafés across the country introduce domestic consumers to the rich, complex flavors of single-origin Yemeni coffee. Photo credit: Mocha Hunters Until 2014, there were no Arab or Yemeni-certified Q Graders. Now, cupping and scoring are standard practices for training producers and demonstrating the quality of Yemeni beans. Photo credit: Mocha Hunters The civil war has severely increased the cost structure for all players along the coffee value chain, making Yemeni coffee less competitive. Pioneer of the Japanese export market and CEO of Mocha Hunters Inc., Hussein Ahmed, said in an interview with STiR Coffee and Tea, "First and foremost is the chal- lenge of extremely high production costs. In coffee-growing areas, if you have a drying station and want to buy fresh cherries, prices range between $3 and $5 per kilo. And it takes 10 kilos of fresh cherries to produce just one kilo of green coffee for export." Yemen's coffee sector is modest and built on the efforts of small-scale farmers, with average landholdings of around 0.3 hectares (or 394 coffee trees) and an average production of 114 kilos of coffee per farmer. On aver- age, farmers spend 41-45% of their total coffee revenue on production costs, while processors spend 70%, domestic retailers 90%, and exporters 60%. Further, coffee producers pay a significant share of the gross value of their production in a variety of taxes, ranging from 8-11%, as part of the enabling environment support. This includes, on average, 5% for auctioneering ser- vices, 2% for the cooperatives, and 3% for marketing services, charged to the government. Another 40% of the gross value goes to pay labor. Hence, a daily profit of around 5-8% for coffee growers. However, some companies, such as Pearl of Tehama, have developed systems for paying quality-based price premiums directly to producers, some- thing previously uncommon in Yemen's coffee industry. The impact has been dramatic, with some Yemeni coffee farmers earning between 30% and 60% of the final selling price, compared with up to 10% in previous years. Downstream vs. Upstream Inequalities Resource accumulation along the coffee value chain is uneven, leading to un- equal wealth distribution and inequality within the value chain. Being a labor- intensive endeavor, the value chain depends on low wages and low returns for farmers. Financial profit is accumulated downstream, mostly by exporters. This is due to two primary reasons. The first is the class of traders, producers, and exporters that control pric- ing, supply orientation (domestic vs. export), and networks (both domestic and in importing countries). The second is the inability of upstream stake- holders to add value to their products, while simultaneously enduring asym- metries in market information and demand, which makes it hard for the ma- jority of coffee farmers to move beyond subsistence mode. Although exporters gain the most profit, they also face hardships. Nowa- days, governments in both the north and the south recognize the economic importance of the coffee sector and its potential to generate income for the public and private sectors, as well as for allies with connections to both gov- ernments. Today's policies are geared less toward developing and supporting value chain stakeholders and more toward extracting rent for coffee exports. Inherently Specialty Arabica is the dominant species in Yemen, with two main varieties being planted: Typica and Bourbon. The varieties grown in Yemen tend toward deeper chocolate tones, while natural coffee processing adds a dynamic, winey characteristic that distinguishes Yemeni coffee from more commercial robusta producers. There are three differentiated coffee products in the country: commercial and specialty coffee green beans, qishr (the Arabic word for husks or peels), and the special beverage made from qishr, known locally as "Yemeni Coffee." "We roast a wide variety of Yemeni coffees," said Ahmed. "Most of them come from a single village or valley, and sometimes even from a single farm. Recently, we even roasted a sample from a single coffee tree. This level of precision is possible because we are a local roastery based in Sana'a with direct access to farmers." Mocha Hunters is incredibly fortunate to trace every lot directly to its source. The company en- courages farmers to revisit and revive the traditional methods passed down from their ancestors. Pre- serving these heritage practices — while remaining environmentally conscious — is the top priority.

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