Higher Base Rates, Flatter Pay Structures: How Pangoa & Ocumal Are Doing Things Different

Tailoring Payment Structures to the Needs of a Group

As we’ve discussed in pretty much every one of our previous pieces about paying for coffee, different groups negotiate their pricing structures with different needs and priorities in mind, and our job is to work with them to create a pricing structure tailored to those needs. Two great examples of groups whose needs are taking our pricing structures in new directions are Pangoa in Peru’s Selva Central and Ocumal in Northern Peru’s Amazonas region. 

Since the beginning, a core of our focus has been that the prices we pay based on cupping scores are transparent from the outset, and the premise of those structures has always been that as scores go up, the price rises, with the base price for the lowest-scoring tier being a sound price that won’t leave behind producers whose crops are clean, sweet, and bright, but maybe not as nuanced in their flavors. While that’s still the main locus we move from, growing our work with Pangoa and Ocumal has led us into a flatter structure with a higher base price and, in Pangoa’s case, only one tier. 

How We Got There

Pangoa  

Of all the groups we work with, perhaps none embodies the values of cooperativism better than Pangoa, so it’s no surprise they were the ones to lead us into exploring flatter pay structures as a way to increase pay for the group as a whole. 

Some background on this group: led by first-ever woman coop leader in Peru Esperanza Dionisio, we’ve worked together since 2017. Although the group has been around and beautifully managed since 1977, they went through major upheaval through the 80s as a guerilla group called the Shining Path caused massive socio-political upheaval for over a decade, cutting membership by half as families fled to bigger cities. When the political situation stabilized after Shining Path leader Abimael Guzman’s capture in 1992, coop membership also stabilized, now ranging from 680-700 active members registered per year and representing a tightly woven community of farmers. Their core focus on cooperativism helped them protect membership throughout the Covid-19 pandemic, delivering groceries to producers during the lockdown months and continuing to make sure members are safe. Various programs have helped members practice biodynamic farming, grow their own food and medicine, and skill-share. Specific programs help women develop alternate revenue streams and valuable skills. The group also has Education and Health Funds for member families. 

Understanding Pangoa’s core focus on cooperativism, it’s easy to see how this group was the one to lead us to a flatter pay structure of one tier only for all coffee that meets our base quality standard. The idea came up in conversations with Pangoa leadership in 2019. We love the coffee we get from them, and the producers who meet the Red Fox quality standards love the higher prices they receive from us, but because Pangoa has other core buyers who pay decent prices for coffees scoring in the low 80s, we weren’t able to catch as much of their volume as we would have liked. Leadership also wanted to encourage more producers to make the Red Fox price and quality jump so they could increase their earnings, and we decided together to increase the base price for all producers meeting our minimum quality standard (which represents the bulk of the coffee we buy from Pangoa anyway) and eliminate higher pricing tiers for higher scores, except in the case of truly exceptional coffees. 

Because we only implemented this new system just before Covid hit, it’s not yet possible for us to know how it’s worked out. Last year’s harvest was complicated by Covid restrictions (the coop couldn’t offer their typical service of agronomists who go farm to farm supporting producer needs, detailing prices, and encouraging delivery) so we received less volume, and this year we don’t yet know what final volumes look like, but the elevated C market and increased competition for green coffee across South America will likely mean we don’t net substantially more volume from Pangoa this year either. We do feel confident that it’ll go up in the future, but regardless we’ve seen that exploring a flatter pay structure with this group who so deeply believes in the cooperative as a value system rather than just a way of doing business has been an enriching lesson. 

Ocumal

Ocumal’s situation was completely different: rather than coming from a place of relative stability and desired growth, they really needed a shift in how incentives were structured to get through the year. Some background on Ocumal: they’ve been around since 2016 and we’ve been working together since 2019, before which they sold all their coffee for much lower prices to a larger cooperative. Home to about 150 members high up in the Luya district of Peru’s densely forested Amazonas region, Ocumal was founded by Faimer Villar and Freddy Zuta Chavez with the goal of working communally to increase quality and build access to financially sound markets to help the community thrive. They offer dynamic support to members including training and technical assistance on organic production, Fair Trade criteria, harvest and post-harvest best practices, and marketing services. 

For Ocumal as a newer and less well-resourced group, they had sold their coffee at much lower prices before we started working together, so they were super happy with the two-tiered structure we had set out before this year. What changed this year was the incredible competitiveness of the green coffee landscape in Peru and the rest of South America with the C market jump and supply disruptions in Colombia and Brazil. In order to make it feasible for members to sell their coffee to Ocumal rather than to passing intermediaries representing multinationals (who arrive with cash in hand paying dramatically elevated prices compared to a normal year) Ocumal had to have extra incentive to offer members in order to make it possible for them to wait. Our goal with Ocumal wasn’t to reward or incentivize a particular type of differentiation, but just to help the group stay solvent through this tough year by raising their base price to a price on par with the high premiums for top scores in previous years and making sure that anyone who makes it to that base tier can stay loyal to the group through this year. While producers win when they can get a high price everywhere they turn, it’s still important to help cooperatives and associations remain solvent so that they can be there to support producers in years when the C market and local market prices are much lower, as we saw in the years leading up to 2020. 

The reason we place so much emphasis on high base prices no matter the surrounding circumstances is that in the case of every group, that’s the bulk of what they produce. Ocumal is no exception. Raising the base price and flattening out pricing nets the group more money as a whole. Next year if Ocumal wants to go back to a more tiered system, we will do that, and if this still works best for them, we can plan to do that. 

Pros & Cons on Both Sides

For producers, the obvious pro is that when base prices go up and premiums mostly go away for higher scoring tiers, the group makes more because most coffee producers, even in the specialty realm, produce the majority of their coffee in the 84/85 tier. Even if fewer dollars go toward premiums over this base, more money goes to more members, period. This is a pro for us too from an equity standpoint—we want to see more money go to producers.

Another pro for both us and associations is ease. Even though flatter pricing doesn’t change that we cup every individual lot rather than relying on type samples, it still allows us to focus on a simple pass/fail scoring system during the purchasing process. Those results are also easier for producer leaders to communicate outward within their organization and community and eases the confusion or resentment that can occur when a producer nets a premium one year but not the next based on quality (and often unrelated to how hard they worked in production). On our end, it also simplifies lot construction.    

On the one hand we have all those pros, but on the other hand, we have the question of whether one flat price for all Red Fox coffee levels would lead to producers not making the extra effort to get past the 84/85 point level, or to resentment from those who do work extra hard to produce higher scoring coffees. Coffees at 86+ level are a staple of specialty coffee, and we love them and want to incentivize their production where we can. 

While those pros and cons exist and factor into our thought processes, the main thing to acknowledge is that some groups want a flatter pricing structure, but some have no interest in one. In Oaxaca where we mostly work with small decentralized groups (often extended families or neighborhoods) without formal leadership structures, we’ve seen that as long as base prices are high enough to make coffee production a valuable trade, some love the friendly competition of getting premiums for higher cup scores, while some prefer for everyone in the group to make the same amount if their coffee meets our base quality standard. In these cases, our shared goals with Pangoa and Ocumal’s specific needs this year led us to a shift in how we pay for coffee with those groups. The key isn’t any one structure, it’s letting groups’ needs lead the way to an incentive structure they like and benefit from. 

Producer Groups’ Needs Should Lead the Way on Pricing Structures 

As pricing and competition dynamics shift and change from year to year, it’s important to approach producer groups with the energy of carrying over the dedication and investment from prior years but being sensitive to their changing needs. Just like we as people have different needs for the incentives that motivate us, and just like our working relationships work best when we have a say in how our needs are met, sourcing relationships should also be built and maintained in acknowledgement of producers’ and associations’ changing needs over time. As we continue to grow and develop relationships with a diverse array of producer associations and cooperatives, our work is to let their needs inform the shared incentives we create together. 

To learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.

Colombia & Peru Update, August 2021

As promised, we’re coming to you today with another origin and shipment update with specific focus on the current and anticipated situation in Colombia and Peru, typically our two largest and most critical sources from the Southern Hemisphere. The C Market has been a rollercoaster ride for the past 60 days, the South American harvest is as volatile as we’ve seen it with the Brazilian frosts and competition for parchment in both Colombia and Peru, and the global shipping situation showing no signs of improvement as the 2021 finish line appears on the horizon.  

Fret not. We will be flush with Peruvian coffee on all three coasts come fall as well as preparing shipments for Korea, Japan, Australia, and Europe. Colombia, Ecuador, and Rwanda will follow suit from the Southern Hemisphere harvests. Our primary objective is to get fresh coffee into your roasteries as quickly as ever.

With that said, you may have noticed that the time we would usually have opened forward booking for Colombia has passed. As we’ll delve into below, the current harvest and shipment situation in Colombia will leave all green coffee sources competing at higher prices for much smaller volumes of quality Colombia coffee. Because of that, we strongly recommend forward booking the majority of your South America volume in Peru, rather than Colombia. We will not be able to offer a substantial amount of Colombia coffee to forward book this year and the quality we’re seeing out of Peru will absolutely meet the full scope of your menu needs. In order to give you the time to outfit your single origin and blend menu accordingly, we’re extending forward book pricing through September 15. To talk through your menu with us or make a commitment, get in touch. 

Supply, Demand & the C Market

The C Market price surged 30+% in July before backing off to the $1.80/lb zone. Three frosts in Brazil have been the driving force in conjunction with dwindling green coffee stocks across both the global north and the Brazilian reserves themselves. The current Brazil crop could be down as much as 10% (roughly four million bags). Long term damage assessment is still in process, though experts forecast even heavier losses in the 2022/23 season due to these three frosts and the horrible drought situation in 2020. The extent of the damage won’t be fully known until after the first rains trigger flowering in the months ahead. It is highly likely that another market spike is tethered to those fall reports.  

Colombia 

Along with a C Market in flux, the Colombia harvest outlook also appears bleak for the upper end specialty segment. Due to an overly wet harvest season and aggressive internal competition for parchment, clean, sweet, complex 85+ coffee is incredibly difficult to come by. We expect our own purchases to be down somewhere in the neighborhood of 50% from this first semester’s harvest versus 2020. Fabian is currently vetting weekly deliveries to the Asorcafe warehouse in Inzá, Cauca and will soon move on to cup through Nariño warehouse deliveries. Our supply will be extremely limited through year-end 2021. Expect pricing in excess of $4.50/lb ex-warehouse on all of our offerings this season.  

Peru 

We are knee deep in the Peru buying season with our first eight containers headed to dry mills in Piura and Lima. Coffees from across the north—Amazonas and Cajamarca—were first-in first-out of our Lima lab this year and will therefore hit the water first, along with Cusco coffees from our primary partners at Valle Inca. With vessels scheduled for September departure, we expect our first arrivals to land in October in both New Jersey and Houston, TX. Our first Incahuasi containers hit the water in September as well.

Our strongest cooperative partners remain competitive in their respective regions, both in quality and quantity. Due to Valle Inca’s location in Yanatile and Lares, they’ve faced the most competition for parchment, but Prudencio’s history with his producer members has proven stalwart. 

Shipping & Logistics

Transporting coffee remains the specialty segment’s most critical 2021 impasse. Container availability is bleak. Vessel availability is a crap shoot and tremendously expensive. Routes have been cut down, equating to longer transship times. Covid-related port restrictions have led to container ships sitting off the coasts of their destinations for potentially multiple months.  

We elected to address the worst situation, Port of Oakland, by landing a healthy dose of our South American offerings in Houston. We will store more coffee at Dupuy Houston than prior years and will also move coffee from Port of Houston directly into The Annex. All East African offerings will land in Port of New Jersey and be railed across the country. Ensuring fresh delivery is critical to us and we’re constantly evaluating and adjusting plans to get coffees to their destination as quickly as possible.

As always, as in all things, we’re here for you—so get in touch to ask us questions, talk, or anything else you need. 

Carina & Fabian of Red Fox Sourcing Talk History & the Future in Peru, Colombia, & Mexico

As we continue working to spotlight voices from producing countries, we were excited to interview Red Fox’s own Carina Barreda and Fabian Viveros Léon in the Foxhole. Fabian and Carina are linchpins of our sourcing program, helping with on-the-ground quality analysis, producer support, and relationship development, among many other things (more in their own words below). Both come from key coffee producing countries in which we’ve worked since the beginning (Fabian from Colombia and Carina from Peru) and have a ton of insight to offer into the current situation and long-term developments both within coffee production and the larger political situations that affect and underpin it. In this Q&A, Red Fox co-founder Aleco Chigounis and head of Red Fox Sourcing Co Ali Newcomb interview Carina and Fabian in Spanish; the interview has been translated and edited for clarity. 

Aleco: It is a great pleasure to have you both here. We want to talk about your work, your perspectives on the coffee industry, and your thoughts on the future. But let’s start with your roles. Fabian, can you share what you do with Red Fox?

Fabian: We do a little bit of everything. Here in Oaxaca, we meet and organize bringing on new coffee producers and relationships. I’m also in charge of quality control, all of the follow-up from the production through to the final shipment, managing the whole chain so that the entire relationship from the coffee producers to the final client becomes one and is fully transparent in our business.

Aleco: Nice, thank you! And Carina? 

Carina: I do similar work to Fabian. I am in charge of managing the labs, first in Peru and now also in Mexico this season. That means handling the logistics for the samples we receive, organizing the cupping sessions, organizing communication with certain cooperatives regarding their results, and most of all, quality control of the offer and preshipment samples we receive, making sure that the lots we buy meet the quality standards that we need them to meet in the dry mills. I also play a role in marketing. 

Ali: In all of our operations both in Peru and in Mexico, there are a really wide range of activities and responsibilities and you two are definitely do-it-all kind of people and you get involved in everything.

Aleco: With all the experience that you both have, in Mexico, in Peru, and also in Colombia (Fabian is Colombian for those who don’t know), how do you see the future of coffee production in those countries? Because a lot is changing fast. What is your perspective? 

Carina: I have more of a relationship with Peru because I spend more time working here, am from here, and I have been working in the coffee industry here for years. I think we need to look at the future of coffee production in Peru through an optimistic lens. We are in a very complicated political situation, coming out of a very unstable political situation. In one way or another that is going to affect the coffee production chain. We will probably see some effects this current harvest. But aside from this political panorama, I feel there’s still plenty of room to grow in terms of how much coffee is being produced, not only at the specialty coffee level, but at the commercial level as well. And in terms of quality, I feel like there has been tons of improvement if we look at the past, especially since the period of coffee leaf rust. Domestic consumption has also increased, which almost automatically leads to higher production and incentivizes it at a national level. So even though this season and coming years might be a little bit unstable because of the political situation, I think it’s worth it to see it with optimism. What do you think about Colombia?

Fabian: Colombia as you all know is a very developed country when it comes to coffee. They have progressed in many areas like quality control, transparency in production, and every day they are innovating in production and processing. They are very far ahead.

In regards to Peru, it reminds me of Colombia years back, in its massive production, and I see huge potential in Peru to develop great coffees, great volumes and great quality. More microlots, new regions. There is still much to explore in Peru. 

In Mexico, we are developing and searching for new regions and producers to work with, in all the areas in Veracruz, Chiapas, and Oaxaca, each one of them still has a lot hidden. There’s so much quality to continue to grow and develop, and we are searching for all this. The expectation in Mexico is growing a lot, because they are small producers, and very dedicated to coffee.

Carina: Yes, to add to what Fabian is saying, I had the opportunity to come to Mexico for the first time and to get to know coffee production in Mexico, and I agree that there is so much potential. There is still so much more to do and help grow and be a part of. Another way of putting it is that I think that Mexico has the ability to become a country that is recognized worldwide for its coffee quality. With a bit of organization.

Fabian: With a bit of organization.

Carina: And a bit of government support, which is something that all of Latin America is lacking.

Ali: It is very interesting not only to hear your perspectives but also your comparisons of the different countries. On the same subject, how do you see the transformation of commerce in these three countries?

Carina: Well, I honestly don’t have an experience as broad as you all have in terms of trading and coffee commerce. The experience I have is basically thanks to Red Fox and the 3 years I have been working with you, so I don’t have a comparative way to see the transformation of commerce in Peru. What I do think is prudent is to always stay up to date with the new trends of consumption in the market. To know what our clients want, what our clients are looking for. And, on the other hand, what the producers are able to produce. 

Fabian: In Colombia the transformation of the market has been enormous. The market conditions for the producer make it very easy to take their product and sell it on any corner and obtain good prices, and it’s very convenient. Everything is ready for the producer to decide where they want to sell their coffee. It is very easy in Colombia to find that kind of market. It is quick and safe. Peru is in the process of getting there. Their volume is huge, and it’s not that easy to find a market for that kind of volume so, the development is going very steadily with the cooperatives looking for markets and presenting the palette of their profiles and the good coffees that you can find in their respective areas.

Here in Mexico, the market is developing faster, because the national coffee shops go looking for their coffee at origin and that helps the producer know their market, know who they are selling their product to in what shops it is going to be sold. So you find a different mix here compared to the other countries, because the national market in Mexico consumes a lot of this coffee, and prices are very competitive with the national companies, and it’s highly coveted coffee inside the country and outside. For all the producers in a lot of areas, there’s a high and constant competition for their product.

Carina: I think it is interesting what Fabian is saying about the consumption culture in Mexico. It’s not as old in terms of specialty coffee as Peru, but I think it has taken off with a lot of force. One of the things that surprised me the most about coming to Oaxaca was to find this fervent culture of third wave coffee shops that want to get into the specialty market. And even though Peru started a few years back, before Mexico, you can’t find as many coffee shops in other regions outside of the capital. I think that’s another remarkable thing about the internal consumption in Mexico. 

Ali: I’m with you, the coffee culture impressed me a lot, and they are so proud of Mexican coffees, and that people are willing to pay a very good price that competes with the international markets. That’s something we don’t see in Peru, people are not willing to pay those prices. And the coffee is not as valued in the same way we have seen in Mexico.

Changing the subject, and I think this is a really broad question because we are in the middle of the protests in Colombia, we just came out of the elections in Peru, but I wanted to know your opinions. What can you tell us about the political situation in Peru?

Carina: How much time do you have? The political situation in the country is in a very complicated moment, as you said. We haven’t finished with the presidential election yet, an election that should have been finalized a few days ago that has gotten complicated due to fraud accusations.

On top of that we’re coming from 5 years of exhausting political instability. In the last 5 years, we’ve had 4 elected presidents, which has damaged a population that also had to deal with the pandemic. Through all of this political instability, aside from the emotional stress that the population has already been through, it has considerably affected the financial health of the country. The Sol (Peruvian currency) has devalued in comparison with the dollar, which has raised a lot of concern within the population as well. The scenario we are facing right now is a possible very conservative left socialist government. There is a general fear in the population, which Fabian and I were just talking about, which is the fear that the entire Latin American population has right now of falling into a socialist model of a dictatorship like the one in Venezuela.

It’s not a very pleasant scenario, but it is what we are facing, so we are trying to keep calm as much as possible, to avoid creating more panic, to avoid creating price hikes, to avoid creating more instability, no? It’s going to be interesting, to see how all this develops in the next 5 years. We have to pay attention as a company and see how this will affect the agronomic sector and what kind of policies in the agronomic sector will be implemented by this new government.

I would like to think optimistically that we are going to maintain the level of production, not only of coffee, but in our work specifically. That coffee production will be maintained, that the internal consumption will continue to be incentivized. I would like to think that the rights of the agronomic sector are going to be protected. But we still have a lot to see, because there is no clarity about what this government’s policies are going to be in regard to the economy and the agronomic sector. That’s a short summary.

Fabian: As far as Colombia, the Colombian people have been enduring the issues that are coming to a head now for a long time, and they’ve felt very vulnerable with the decisions that the current government has made. With the abandonment of the people’s needs and everything that the government has done, the Colombian people have reacted. Unfortunately, now with Covid, the resentment has been much more brutal.

Ali: Going back to your idea, these are issues that have been present for many years, and now everything is coming to light. These are not new issues, but rather years and years of resentment.

Aleco: It is like boiling water passing its limit, no?

Fabian: Yes! Yes, as Ali was saying, people’s resentment has exploded now, and because of the pandemic everything has gotten more complicated. The government has also been unwilling to listen to the people. There are many industries that have been left unprotected by the government. Now, during these times, they have gotten together to unify their voice, unify their shout, against the president, the government, because of their bad decisions. Commerce has been affected. In many instances they have cut gas, energy, water, access to food has been blocked for people who are far away, it has been very complicated. It’s the dissent of an entire population, everyone who has been mistreated by the system, and it’s affecting us all. The entire production chain, the health chain, and the entire system in Colombia has been … well, it has collapsed.

Carina: Do you have presidential elections soon?

Fabian: Yes, same, we have presidential elections soon, and that increases the internal conflict even more, and the conflict of interests. The instability.

Aleco: Thank you for this, we know that everything is changing daily in the two countries, and we are in front of the television, the radio, the internet, looking for any kind of news that we can find. Your perspectives are invaluable. 

Carina: I want to thank you for the space, for me and Fabian. I feel like we have to be paying very close attention to all changes, how they can possibly affect the coffee industry, and the possibilities of the producers.

Aleco: Thank you very much for your time, you are two of the most powerful ingredients in our recipe, our company. I thank you all for everything. And I will see you soon in Peru, or Colombia, Fabian.

Fabian: Thank you Aleco, see you! See you soon!

To learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.

Prudencio of Valle Inca, Peru on Building Trust & Community

Prudencio (Jose Prudencio Saenz Vargas) is the widely respected leader of Valle Inca in Cusco, Peru, one of our largest and most important relationships in the world. A Calca native, Prudencio grew up on a coffee farm, studied agronomy, and then went on to work as a bank loan officer before running Valle Inca—fiscal experience of critical importance to Valle Inca and the surrounding community, most of whom are smallholders averaging just 2-3 hectares each. His extreme quality focus has always been key to the group’s success. He helped Valle Inca producers move from drying coffee on plastic mats to raised beds, worked to improve drying, fermentation, and storage practices, and was the first producing partner of ours to implement GrainPro in storing parchment. He meets farmers where they are in the isolated reaches of Yanatile and Lares and works with them to produce the best coffee they possibly can for the best price they can get. What follows is a conversation with Prudencio, aired originally on the Foxhole and edited for clarity and brevity. 

Aleco: Hello and welcome to the Foxhole. Aleco Chigounis here with Ali Newcomb. Today we have one of our most special guests: our good friend José Prudencio Vargas Sáez, from Calca, Cusco. He is the leader of the Valle Inca group, which, while still being a relatively small and new group, has become the largest Red Fox sourcing partner by volume in the world. We have grown with Prudencio from 40 bags the first year, to almost 12 containers that were made last year and from there they will continue to grow. 

Welcome Prudencio! It’s a pleasure to have you here. 

Prudencio: Thank you.

Aleco: Can you tell us a little bit about how you started the Valle Inca group?

Prudencio: Yes. My name is José Prudencio Vargas Sáez, I am the son of a coffee producer, from the community Laco Llavero in the district of Yanatile, province of Calca, region of Cusco, Peru. I’ve been in the coffee industry my entire life. I was born on a coffee farm named Tomas Huato in Laco Llavero. Later I studied agriculture in a Salesian school. Coffee is my life. It’s my life, it’s my world, it’s what I do, and it makes me feel good. All of my family are coffee producers. There are coffee producers in my community that have really suffered from low prices in the past and been totally abandoned when prices were low. All of that is what inspired me to start Valle Inca.

Aleco: What year did you start the association? 

Prudencio: In the year 2015 and in our first year we sold just 20 quintals of coffee to Red Fox. It’s been six years since Valle Inca started taking form, but four since we had full legal status.

Aleco: How many producers did you start with?

Prudencio: We started with just five producers in the Yanatile Valley. Among them, we have Mr. Agustin Ccasa, Juan Jose, Eddy Robles, and other coffee producers that didn’t really believe in an organization like this at the beginning. Just like any other startup, there’s not much credibility early on. But by 2017, we were working with 50 coffee producers. In 2018, we worked with about 127 producers. And currently we are working with 260 coffee producers.

Aleco: That is incredible, Prudencio—congratulations!

Ali: How was the process for you, because you were a loan officer at Agrobanco (agrarian bank) before that, no?

Prudencio: Yes.

Ali: You were working with the coffee producers then but making agricultural loans. And from there, you went on to start Valle Inca.

Prudencio: Yes, that’s right. The thing is that I have been involved in agriculture my entire life. Beginning with where I was born, where I went to school, and leading up to the moment that I worked with Agrobanco making loans to coffee producers. It’s a different world and very helpful experience, and in parallel I was working with the organization that is now Valle Inca, but with a small amount of coffee. The financial experience has helped a lot. 

Ali: What have been some of the challenges? You started with only 20 quintals your first year and just five coffee producers, and now you have grown to a large organization, exporting a lot of coffee—more than 15 containers per year. What challenges have you faced in that process?

Prudencio: The main challenges are, paying a sustainable price to the coffee producer, obtaining high quality coffee, and being able to reach new coffee producers. And to fstablish equity so the producer, the intermediary, and the consumer are happy: that is the challenge that Valle Inca set out to achieve. 

But the biggest challenge in Peru is always getting fair prices for the producers. The next one, is the quality. That for us, is very important. The quality is very important, to look for, to research more. Find more producers, to understand the altitudes, the varieties, the genetics. Coffee is its own world, a world that millions of families depend on. All of that is the work we do. 

Ali: Regarding quality, I think we all recognize that you have been very successful, and just a moment before this meeting we drank a spectacular coffee from Combapata. 

Prudencio: I am drinking a coffee from Alto de Cedruyoc, from Emilio Gutierrez. It’s early coffee from the 2021 harvest.

Aleco: Very good.

Ali: Prudencio, I know Valle Inca plays a big role in the community, more than just buying coffee. Can you tell us a little bit about that role and how this has played a part in facing the pandemic?

Prudencio: As you said, Valle Inca is not just an organization that buys and sells coffee. Our goal is to find a sustainable future for the community. We work to be calm and coordinated in our decision making, and that was key during the pandemic to maintain trust and support the community. At Valle Inca we keep our word. We fulfilled everything we committed to and focused our resources on producer needs. If someone needs a loan, we have to find a way to do it, whether we have the resources or not to support them in their hardest moments. Now we have to look after health issues, social effects. For example, right now we’re working to get psychologists for the producers, so they can improve their mental health and quality of life. We’re also responsible for finding a good price for them, to offer them that stability. In turn, they do the best work they can offer. 

That all helped us a lot through the pandemic. 2020 was a very difficult year, but as a collective I have to thank Red Fox, and your clients for the donation you made to us. It all adds up. Here in Peru, we were lucky to be able to look for help from the municipalities and NGOs to help all the producers: with staple goods, mainly to cover the food needs. At the moment, we are working full force disseminating information to gain the producers’ trust, and to improve their trust in the clients and the entire chain.

Aleco: What would you say have been the main achievements of the cooperative since you started?

Prudencio: Of course, when we started in 2015, Valle Inca sold 20 quintals, and never in our lives could we have imagined selling 5,000-6,000 quintals of coffee per year. Every year we set a goal, evaluating, analyzing, and measuring production factors and risks. The biggest achievements have been growing and selling more coffee, and selling coffee that was of a high quality, for the consumer, for everyone really. We want coffee we are all happy with. That’s the goal. We’re also proud of working on the social aspects, the collaborative association that we manage. To gain producers’ trust and always keep our word with them. 

Ali: That’s a great answer. Prudencio, I wanted to ask you this, because you are one of the people who does this the best. What is the key to having a good relationship and communication with the producers?

Prudencio: In summary: trust. The trust that exists between us and the producers. At the end of the day, we are a family, we are the Valle Inca family. That the workers at Valle Inca can feel at home, that they can feel that we are siblings, someone they can count on to share their weaknesses or their sad stories, everything: trust. A resounding trust like with Red Fox—just like we can trust Aleco not just to keep his word but to let us know if there’s a mistake we’re making, that’s part of trust with the producers as well, what mistakes are we making, and how we can improve, and all that. In that way we can all build  trust. That is the key to building an association. And of course, to keep our word.

Ali: Well, I love working with you. All of that work shows in how everything flows and you do an incredible job as a team, with the producers as well as with your employees, and with Red Fox, because you are always very direct, you are very transparent, and you make things flow very well.

Aleco: Yes, the communication has always been open and direct with you. That is fundamental, to be able to have a good relationship in this industry.

Prudencio: It’s very important. For example, in the beginning, we are very thankful to Red Fox because if Red Fox didn’t exist, Valle Inca wouldn’t exist either, and if there weren’t coffee producers, Red Fox wouldn’t exist either. Inca Valley is on the producer side, and all of us, we all fill a gap in this supply chain. What we have to do is improve every day, to increase the production area of ​​the producers, and continue to improve the genetics in the coffee in Peru. That is the main goal. We also have the goal of winning international competitions, national competitions, to continue being a transparent company, and to sell quality coffee.

Aleco: Excellent, Prudencio! Do you have any questions for us?

Prudencio: First of all, I want to thank Aleco for the trust, because when I started Valle Inca, we were very young. We were young and we didn’t know exactly what to do at every turn, and maybe we made mistakes, but we learned from that. Thanks to Red Fox for helping us out all these years. And for being an institution that we trust fully, because you’ve helped us grow, and have helped a lot of other businesses grow and organizations and cooperatives in Peru, in Puno, in Cusco, Cajamarca, and other places in the world. I would like to ask you if you are happy working with Valle Inca?

Aleco: Truly Prudencio, it is my pleasure completely … well, ours. We both made mistakes in the beginning. I wasn’t as young as you were. But just like you, learning to manage a business. It has been a great experience. There is a line, where you can see how much Valle Inca has grown, and how much Red Fox has grown. And they are parallel. And truly I feel like you and I, we have grown together in this, but it’s not only Aleco at Red Fox, as you know better than anyone, with Ali, with Carina, managing everything there. We both have very strong teams, and having this partnership has been a great pleasure for me. I am more than happy, let me tell you.

Prudencio: Thank you, thank you Aleco, for all your trust, I want to celebrate your team, it is exceptional, and it is very important, there you have Carina, Ali, Aleco, some others that I know, Jajaira, who helps us so much, with our exports and more. We have to keep going forward, continue supporting the producers. Everyone, keep drinking Valle Inca coffee, Cusco coffee, and Peruvian coffee. Thank you!

Aleco: To you!

Ali: Thank you very much Prudencio. It’s always a pleasure talking to you, and I am very thankful for your trust, and for being here, and being able to share with everyone.

Prudencio: Of course, thank you.

Aleco: Ok Prudencio, I’ll see you soon, in June for sure.

Prudencio: Thank you, thank you!

To learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.

Esperanza Dionisio of Pangoa on Cooperativism, Women Leadership, & Covid-19

Photo courtesy of Mark Corpus of Reanimator.

Esperanza Dionisio has a reputation that precedes her. Leader of the Pangoa cooperative in Peru’s Selva Central and the first ever woman cooperative leader in Peru, Esperanza is an incredible speaker and a powerful voice for gender equity and women leadership. In this Q&A, Red Fox’s Ali Newcomb and Carina Barreda talk with Esperanza about her unique position in the Peru coffee world, her singular history as well as that of the Pangoa cooperative, and the impacts of Covid-19 on the most recent harvest and shipping season.

Ali Newcomb: I’m here today with my colleague Carina Barreda, who’s responsible for quality control here in our office in Peru. We’re honored to have a very special guest, Esperanza Dionisio. She is the manager of the Pangoa Cooperative in the Selva Central region of Peru. Esperanza, you were the first ever woman manager of a cooperative in Peru and you’ve had a very interesting experience. You’ve been a big inspiration for many of us here that work in coffee. Could you tell us how you started working in the coffee world and at the Pangoa Cooperative?

Esperanza Dionisio: I studied agronomy at University of La Molina, then went to Germany to study crop physiology. I’ve always been drawn toward tropical crops. I came here to Satipo, where one of my aunts worked as a teacher. That connection helped me find cooperatives who needed agronomic help. First, I worked in Satipo, starting in 1978. In 1980, I started with the Pangoa Cooperative, but in the technical area, in agricultural extension. My passion was rural development. At the cooperative I was in a good place to do rural extension. When I talked to the farmers, the agrarian federations, and all the engineers and cooperatives, they always raised the issue of low productivity, that the coffee crop produced just 11 quintals per hectare. I started working on that. I traveled to Costa Rica and Brazil, and the Pangoa Cooperative supported me with all of this. I achieved the goal of increasing the productivity from 11 to to 90 quintals per hectare.

I saw that the farmers were receiving much more money because of increased productivity, and I wanted to make a sustainable living as an agronomist. So I opened my own office in the plaza, which was another challenge, and waited for clients, the producers.

But then the Shining Path (Peruvian Communist Party) came in 1987, and I couldn’t do that work anymore. When people would come to my office, they would tell me such and such person is dead, and because I knew them, it would bring me sadness. One day one of the militants came to my office, and I had to close it down. Then I left for Ica with my husband. Later, we came back to the jungle. We hadn’t sold anything, we closed our home and we left, because we had thought, this too shall pass. The “senderistas” (militants of the communist party) weren’t going to stay here forever.

When we came back in 1995, the Pangoa Cooperative was going through a difficult period because they had paid out the members but not as they had promised. They had promised them $25, but they only gave them $1.70. So everyone was in conflict. They came to my house to find me, and asked me to help them sell the coffee, to manage the coop.

I accepted for one year, and now I have been here for more than 22 years. We renew every year. That is a good thing about Pangoa. When my year is up, it is evaluated. The team of directors comes and gives me advice, or they tell me what I should improve, and we continue working.
When I started, the cost of the coffee was $50. So, I said, “Wow. How is this going to work? How is the farmer going to be able to cultivate the coffee at that price?” The group was buying and selling based on the C market alone, and when the price was down it wasn’t sustainable at all—but even when it was up, it wasn’t enough to save. What farmer is going to be able to save when they are always in debt? I decided to investigate and see what else is out there, because I didn’t think that the C market price was our only option. That is not the purpose of the cooperative—the cooperative is an institution that develops something more for the members. We found we could make more from organic coffee, fair trade coffee, so we decided to pursue those certifications.

There were challenges throughout that. The bank would treat me so poorly every time I would put on the t-shirt of the Pangoa Cooperative. When we would go to the bank in the early years, our balance was in the red and they would say: “Are you the manager?” “Did they hire you?” “Well, you are all walking cadavers.” Wow! Walking cadavers.

We called an assembly, and during that assembly, I told them how I was treated when I was wearing the clothes of a farmer. It is horrible. So, I said, let’s work on improving the esteem of the famer so he can get some respect. Because at the end of the day, he produces good coffee, good plantain, good rice, he has the food. He has good cocoa. And that is how I started, and the next year, it was more interesting, and the next one, even more interesting. We kept surviving and growing and in 2003 we started to export.

Carina Barreda: You’ve mentioned many challenges that you’ve faced in past seasons, from production to coffee prices to certification. I wanted to ask you, this past year, how has the pandemic affected the work of the cooperative? What new challenges have come up, both for the cooperative and for the workers? And within the cooperative, what have been the challenges both to production and distribution of the coffee?

Esperanza Dionisio: On March 16th, the lockdown was announced, and everyone had to go to their houses. We had to meet quickly, the board members and the staff. The pandemic woke up our neurons to be able to face the quick changes, and adapt to the changes.

We also saw, as a group, that some of us were weaker, others were stronger. We agreed that to face this, our knowledge must emerge to face this pandemic collaboratively. It was a team effort, from the best team that exists. That’s how we have gotten through this.

The offices were closed at the beginning, but the cashiers were here, the registers were up and running. Others would work from home on their computers, and the rest worked in production and planning. We also had to study what Covid was. What is this virus, how does it attack? We trained ourselves a lot. We all did our part, we all brought news about how things were around us, in the hospitals, our relatives, our members, and we made team decisions.

In the beginning, we decided that the producers would all go back to their farms. Once there, they couldn’t leave, so we had to buy them groceries. We contacted people from Lima, and I have a colleague who works in the wholesale market. I called her and asked her, “can you get me this order?” We checked with everyone here. Then we started, like “coyotes,” to distribute groceries to all seventeen committees. The cooperative is well organized, all 17 committees participate in training. All technicians had the phones of the members so we could all communicate. Each person in their place, using phones to see how we were going to collect the coffee, how we were going to be able to move the coffee, how we were going to collect the cocoa, and ultimately reach our goals. We did an analysis to determine, if the farmers don’t have help from pickers, the harvest is going to decrease, and what is the minimum that we would have to collect, no matter what, to be able to maintain ourselves financially?

From there, we got a loan offer from the state through Fondo Peru with an interest rate of 1%. We have received 1.7M soles plus 500,000 soles. That’s helped. We were all attentive to what was happening. We retracted to the production area. If someone was down, the rest would cheer them up, and we would go on as a group. We didn’t get sick until August, and we were very well informed. We received a very important document from a doctor in Iquitos that gave us the security to work safely. Just like a simple flu, we learned about the first phase, the second phase, the third phase. And if someone got it, we would send them home. We didn’t buy the huge quantities of antibiotics that we were planning to purchase because we received this information from this doctor that helped us a lot.

We’re also grateful to the clients who continued to purchase from us, because what would we have done if the clients didn’t buy our coffee? They were buying our coffee, and our cocoa, just like in a normal year. The solidarity and the trust made all the difference. The farmers would send their coffee, right here we would do the analysis, and by phone or WhatsApp, we would send them the number of kilos that they would have to charge. Then the farmer would come to the register and get paid.

Ali Newcomb: Impressive, and it is something that we have always highlighted about Pangoa, its people, and its team. I remember in June, I talked to Mr. Albino, and he told me a bit about the things that you have just shared with us, the impressive speed and the scale with which everything was handled during the pandemic.

Esperanza Dionisio: We sent a letter to all our customers at the beginning, in the thick of the shock and the fear, and we sent another one at the end, now in December talking about how everything went. As I said, our neurons started working, and many skills have been recognized within the staff, the members, and the directive team. It has been very interesting.

Ali Newcomb: Changing the subject a bit, you have a committee for Women’s Development, right? Could you tell me about how it started and what kind of work do you do there?

Esperanza Dionisio: The committee for Women started in 1997, with PADECO, a program from the NGO SOCODEVI, back when we belonged to the cooperative union (Central de Cooperativas). In addition to a lot of practical initiatives, we do a lot of training on self-esteem. It’s a very important subject, for women to learn how to say no, with confidence, how to talk to their husbands, and for them to be able to help their kids feel confident as well. That subject isn’t something you learn overnight, it is something you do long-term. It never ends, we have new generations, new youth, the first ones are already grown, and we have to continue working on that subject, self-esteem.
In terms of projects, the women do a lot. They raise small animals, they cultivate vegetable gardens, we have sold and continue selling coffee produced by women (“Café Mujer”). Now we also have reforestation, with 90 women and 45 hectares reforested, half a hectare of solid wood per woman. Why have we committed to reforestation? Because we want to teach our kids to love Mother Earth. We want to teach them by taking them to plant a little seedling, so when it grows, they can have a feeling of belonging and love for Mother Earth.

Ali Newcomb: It’s very important. When it comes to the subject of self-esteem, it is clearly a challenge in the coffee industry. Are there any other challenges faced specifically by women?

Esperanza Dionisio: Women face how to ensure there is food for their children, for their family, they also take on the education of their children, the well-being of their children. Well, during the pandemic it helped that they had to stay together, children and parents. But usually they send them here, to town, so the mother suffers when the children aren’t with her, and they have to take on the responsibility of their kids being down here in the town. So, yes, women have a lot of challenges here.

Carina Barreda: We also wanted to ask you about the program of rotating economic funds that Pangoa has to help its members. Could you tell us a little bit about the program, where it started and how it has developed?

Esperanza Dionisio: Yes, that is a story! Yes, we have a rotating fund that we started with money from FLO Cert in 2006. That’s for the Education Fund which now has $100,000 in members’ hands, for the youth that are studying as well as the Health Fund. Why did we decide that the children have to study? In 2005, we noticed that our members were all elders, so we started having the youth participate in assemblies. That’s when we started to worry about their education: they had to gain the knowledge so they could qualify for positions here in our cooperative business. The youth wanted to take over the leading positions, but they had to be prepared first, so they started studying for various careers. There are lawyers, pharmacists, some studied for ADEX (export association). Later, we received a really good program from the government, Beca 18. That helped a lot, because now we have a lot more professionals in the field. That is important because in that way the companies improve the quality of their service. So, we have funds for health, renovating coffee farms, for quality control, for solar dryers, wet milling areas on the farm, fertilizers, a solid fund to rotate from producer to producer. It is in dollars and with 0% interest. Each has its own purpose.

Carina Barreda: I wanted to come back to something you mentioned before, about the younger generations. It’s a big problem in the coffee sector when the young generations leave the field and move to the city, or they choose a different path, and then we only have the oldest generations as the producers. This is different in Pangoa?

Esperanza Dionisio: Yes, we have been working with the youth since 2006. It has been many years. In 2012, we complemented, alongside VECO, an NGO that took over a project for youth, to train them in production, cupping, and the entire coffee production chain, to make the coffee industry more attractive. Once the youth start to cup, they start to think about where the coffee comes from: they know it comes from this farm, so they start noticing the plant, the variety, and at times they end up growing coffee, taking care of the land and preventing the land from being sold. Our message has always been, do not sell the land. Instead, reforest it. We have been reforesting constantly since 2000, reaching one million trees, and also to have the youth who work invest their money in trees, so they can have wood and money when they are old. We don’t have retirement; therefore, those trees would be their retirement plan. So the youth see reforestation as a business, and coffee as a business, especially now with this pandemic because they had to come back from the capital to their farm. Many young families have come back to the countryside, because Lima is impossible now, a city with a lockdown, there is no work, but the field still offers work. Fish farming, small animals, the diversification of crops, plantain, pineapple, coffee, cocoa. There are now more business opportunities here on the farms than in the city and they are valuing the land.

Ali Newcomb: Thank you, Esperanza. I love that you, as a cooperative, approach everything from an integrated perspective. The project that you have with the youth, environmental aspects, financial aspects, and that makes you much more solid.

Esperanza Dionisio: At the end of the day, we are a group of people, families, we have to exist, and if we want to exist in the market, we have to help each other and see the perspective and change strategies constantly so we can continue to go forward. You know, review the vision. This year, we are in the year of re-engineering, and Covid has accelerated the re-engineering for us.

Ali Newcomb: Yes, faster. That long-term vision is what brought you where you are today and what helps you to maintain and grow. This takes me to a question about prices, because with Pangoa this year, we tried out something that we had never done before. We started with Pangoa about three years ago with our usual pricing structure, which is to pay different prices for different quality tiers: one price for 84 and 85 point coffees, another price for 86 and 87 point coffees, etc., and what happened is, in reality, with all the work that comes with producing and selling microlots, the base price for those coffees wasn’t all that much more when compared to what some of your other loyal customers were paying. So last year, you and Albino proposed the idea of increasing the base price, and we decided to have just one base price that is much higher and differentiates us from your other customers instead of differentiating between an 85 and an 86. I wanted to know what, now that we’re at the end of this season, how did it work for Pangoa?

Esperanza Dionisio: It went very well. The higher base price is great, because it helps the farmer to differentiate himself from the rest. The technicians go and teach them so they can produce good quality coffee, and they make the effort. For the farmers who produce specialty coffee, not all of the coffee production is special. As the name itself says, one part of the production is special. That small part has a special price. And for the farmer that wants to do the work, it’s very good. Encouraging them with price is very good, and I thank you for that, and I thank your customers who are supporting Pangoa with that price.

Carina Barreda: Pangoa has demonstrated being an exceptional cooperative, a very successful case in the domestic and international markets. Coming from you, what advice would you give to other managers from other cooperatives, that are hoping to grow or become more productive?

Esperanza Dionisio: First, observe, see, talk, work as a team, and get everyone’s vision. That vision has to go along with the vision of the manager. If the manager doesn’t share the vision of the team, then there is a divorce there, so there has to be a union of visions, to be able to grow as a business. Another aspect is to comply with the cooperative principles. If we are a cooperative, we have to follow the Rochdale principles, that they fought for in 1844 and that we embody today. The manager should be a leader without a position. Do things right, and it is that easy. Work as a team, members, directive team, staff, see the strategies and be able to go on in the business.

Ali Newcomb: Thank you very much. Anything you want to ask us or share with us?

Esperanza Dionisio: I want to thank you for this interview, and to tell you that cooperativism is a very good system. It’s something that every organization can learn from.

 

To learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.

 

Tibed Yujra of Puno, Peru on Puno History & Launching An Association During Covid

We were lucky to get a chance to sit down with Tibed Yujra, a long-time partner in Puno, Peru, in the Foxhole for a conversation about his work in organizing a new producer association, Puno’s recent harvest, and the challenges posed to both by the Covid-19 pandemic. For more background on Puno’s history and Tibed’s role, click here.  

 

Aleco Chigounis: Hello everyone, welcome back to the Foxhole! We have a very special episode for everyone today. I am joined by my talented co-host Ali Newcomb. Ali is the managing director of our export and sourcing operations in Lima, Peru and Oaxaca, Mexico. Welcome Ali! How is the weather in Lima?

Ali Newcomb:  Good, very good.

Aleco: We also have a very special guest today, Tibed Yujra. Tibed is a former Red Fox employee, who left to start his own producer association and sourcing operation in Puno. Tibed has been a very close friend of mine personally for well over a decade and has a really amazing professional career history, and he’ll tell us all about everything he’s done back then and what he’s doing now. Welcome Tibed! 

Tibed Yujra: Thank you so much Aleco for the invitation.

Aleco: It is a pleasure, my friend. It has been a long time. How is everything in Putina?

Tibed: Always good, we are all good, very good here.

Aleco: It is important to know by the way folks, that Tibed is joining us from Putina Punco, deep in the Sandia Valley way out in the producer area just above town, in a little hamlet called Chorrillos. Tibed, can you tell us a little bit about your family, where you are from? I know you have gone from the plateau to the jungle and everywhere.

Tibed: My family came from the mountain range of Puno, and the majority of the people who settled in the jungle of Tambopata where I live, they are also from the mountain range. My parents settled there years ago. I was raised there and have lived there since. Then and now, my family has always been in the coffee world, and that’s why it so much.

Aleco: That’s good, and Tambopata is the jungle where you find all the coffee of the Sandia Valley, or no?

Tibed: Not only in Tambopata. We have two valleys: Tambopata, and the other one is called Inambari. 

Aleco: And that is where your family is from and where the famous area of Tunquimayo is, no?

Tibed: Exactly.

Aleco: That is good. Can you tell us a little bit about your professional story? How did you start in the coffee industry? And how did you get from there to here in the present?

Tibed: Yes, it’s a long story. Basically, it started with my parents. They started producing coffee in this jungle and I started working with them, to see how the coffee grew, how the production works, how the export companies work—the ones that existed here during those times like Cecovasa and other cooperatives. Now that my parents are older, they moved to the mountain range, to be more comfortable and take care of their health. And so, that is how I started. I then started working in Cecovasa almost 11 years ago. Sometimes I worked in the warehouses and sometimes quality control in the laboratories. After I left Cecovasa, I went to work for a nonprofit in Haiti called Veterinarians Without Borders. I helped a lot of Haitian producers to improve their coffee quality during those times. After that, I started working at Red Fox alongside Aleco, and with everyone in the team that are still working there.

Aleco: That is so good! A question, how long were you working for the group of the vets in Haiti?

Tibed: About two years.

Aleco: I remember when you and I met the first time in Putina, sampling something like 200 coffees in only two days. 48 hours cupping like crazy, and we became very close friends over there. But after, you left to go to Haiti, and to go work at other levels as more of a consultant. Then we met again in Incahuasi, right?

Tibed: Exactly! Yes, I worked at a cooperative in Incahuasi for a term as a consultant, and we saw each other then too, when I was finishing the consulting work there. 

Aleco: It made me really happy seeing you again. From there, we went together to the future, no?

Tibed: Yes, exactly!

Ali: Tibed, I wanted to ask you—we are very excited, with everything that you have initiated this year, your new project in Puno. I wanted to know if you could tell us a little bit about this project, and how it has been?

Tibed: Yes. The fact is that there are many producers, and despite all the effort that they put in at the farm level, they don’t receive the appreciation or money they deserve, and that is the reason why we have started to build an association to help the producers. So they can receive a fair price for the quality of their coffee. It’s a huge endeavor to cultivate the coffee, it’s not an easy task. I also have a farm, and it’s very complicated to produce specialty coffees. It is intense, the reality of a producer, and I think that work needs to be rewarded. That’s why we started this project: to put together a group of producers, organize them into an association, and allow them to export their own coffees, and so they can receive a fair price for the quality of their coffees and their work. 

Ali: And how has it been? Because, you started this in full pandemic, and even though you’ve known a lot of these producers for years, you’ve started from zero this year. All the social parts, talking to folks about all the work that you were going to do, the logistics of it, tell us a little bit about how you’ve been working this year?

Tibed: Well, for me, it has been very complicated basically because of the pandemic, because it was really difficult to travel or even communicate with the producers. The producers themselves were afraid, so they didn’t want to receive visitors. In general, it’s helped me a lot to know many of the producers of the area of Sandia. Both valleys, in Tambopata and Inambari, and this is the reason why they have trusted me so much. I think it’s fundamental. Definitely there have been a lot of roadblocks, but I think we’ve achieved something.

Ali: Yes, we are trying the samples of the first container and they are spectacular. 

Tibed: It makes me really happy to hear this.

Aleco: You have done an excellent job getting the best producers. Better than ever before. The coffees of the producers that we have been buying for the last 10 years or so. Good job!

Ali: Can you tell us more about the challenges that come from your specific location? Because you are working in a place that is very remote, where there aren’t any banks. What challenges have you had in that area, with financials and logistics?

Tibed: Yes, indeed, it is very difficult. The financial area especially, because it’s so fundamental to try to cushion the finances of the producer. They don’t have the luxury to be able to simply give you their coffees and trust that you’ll pay them later. They need some upfront payment. So, this part has been very complicated. As you know well, this area is very far away from the city, the trip is very long, and since there aren’t banks there, we have to try to transport the money safely and avoid theft and other obstacles.

Aleco: Coffee production in Puno has a very interesting history, all the trading and commerce of the coffee, doesn’t it?

Tibed: Yes, it’s very different. I have been in various countries, and I know, like for example in Honduras, the production and transport from the farm to the port is so close that it doesn’t take more than 4 or 5 hours of travel. But this area is so remote. Imagine it, from Putina Puno to the production zone of many producers, and we are not talking about its total, some producers are 6 hours away, some others 8 hours, and then from there to the port or to the processing plant that is located in Lima. It is very far, and we are talking near 40 hours of travel for the coffee, and that is very far, I think is the most isolated part in the world of coffee, if I am not mistaken. 

Aleco: I always tell the story of one time that you and I were in Pilcopata. It was many years ago but, many years ago. We were visiting someone, and we happened to see Mr. Ciriaco Quispe taking his coffee down bag by bag in a wooden wheelbarrow. His farm is almost a whole hour of walking straight up. It is difficult. And I can’t even imagine how to bring down 100lb bags in one of those wheelbarrows. Bag by bag, it has to take hours. Even days, no? It is insane. So, it’s not just a matter of where the production is, but how to get to the town as well. It’s incredible, I’ve never seen something like that in my life. 

Tibed: Yes, the topography is rugged. And making a wrong move while carrying the wheelbarrows, one can get injured or worse. 

Ali: How do you do it Tibed, this year? Did you go and pick up? Did you have a meeting point where the producers would come and deliver to you? 

Tibed: This year we had a temporary meeting point where Silvia has helped us a lot. She is a long time friend who’s also a coffee taster. So, that is the agreement that we made in the production area. But we also had a warehouse that we rented in the city of Juliaca. 

Ali: And from your warehouse to Juliaca, how many hours are in between?

Tibed: Well, by truck, it is about 14 hours.

Ali: That means just one way, no?

Tibed: Exactly, one way only.

Aleco: Can you tell us about your famous wife? Delia, winner of a great place in the Cup of Excellence competition last year and a renowned producer of the highest quality coffee? 

Tibed: Yes, my wife Delia and I started this growing project because we wanted to know the true effort of producing high quality coffee and be able to experience it with our own hands. You can see it in a book, or you can see it in biographies, whatever is written can say something, and something different is what you truly go through and work on. It is very difficult growing specialty coffee and at the same time, it’s a passion, and this is the reason why we started with the farm so we could experience all this. And to explain what truly happens in the farms and how we can actually improve the quality of the coffee for other producers in the community. That’s why we entered Cup of Excellence. Delia’s coffee, our coffee, ended in 11th place. We hope to be able to compete again in the upcoming years and see what happens. To see if we can win, that is also the goal, no? 

Aleco: Yes, I would say we know a lot of the stories of the coffees of well-known Puno producers like Ciriaco and Raul Mamani, Benjamin Peralta, and Wilson Sucaticona of course. And Abdon and Juan Quilla, but Delia’s coffee has added a higher level of quality. That amazing coffee. It is one of the best coffees in the entire continent of South America.

Tibed: Wow! Thank you for your appreciation for our coffee, it makes me really happy, and believe me, my wife is really happy for this as well.

Aleco: Yes, well we thank you so much Tibed, and say hello to her from us please.

Tibed: Of course, that I will do.

Aleco: Ali, what else?

Ali: Well, I’m just thinking you’ve had so many experiences, Tibed

Tibed: Yes. It will take me a life to tell you all of them.

Ali: What has been your favorite part of the farming project that you have with Delia? It seems like you started it primarily to learn from the experience, no? What did you get out of it and what have you enjoyed from it?

Tibed: Yes. In the farm we have many varieties, so that we can see the behavior of the different varieties. There are varieties that are very demanding in the fertilization, there are varieties that are strong and resilient. That is essential to know because, as a producer, if I want to produce specialty coffees, I have to manage my geographic location, I have to look for a good variety, so that knowledge is essential. The farm has taught me all that. What I like most is seeing the differences between all these varieties. I like it a lot because we’re also the ones who apply the fermentation in wet milling, and being able to experience the fermentation to see how it helps us. It’s complicated to use this method. It is very delicate, and just one mistake can damage the entire harvest of the day. 

Aleco: A question about the varieties: what variety does best in the microclimate of Tunqui and Putina Punco and all the area of Tambopata?

Tibed: The bourbons. 

Aleco: The bourbons, yeah. It is a very popular one in the area, no? It is something so special. It has floral flavors like the ones from Ethiopia. 

Ali: Tibed, I wanted to ask you, you have 3 kids, right?

Tibed: Yes, exactly!

Ali: And they have grown there in the ranch cultivating coffee with you all.

Tibed: Yes, during the pandemic yes. They have been here together with us.

Ali: And would you like for them, when they are grown, to be coffee producers? Or for them to do something else?

Tibed: It is a little bit difficult for me to say that because, I can imagine, each of my kids may have other likes, so for me personally, I think it would be good that they would be involved in the coffee world, but I think each of them will decide their own destiny, their own likes. Maybe one wants to be a doctor, or maybe another profession, I don’t know, they might not be involved with the coffee. Maybe they don’t like the world of the coffees but at the end of the day, they will walk their own way. But for me, personally, I would really like that.

Ali: Beautiful outcome.

Aleco: Well, then, is there anything you want to ask us or say to us?

Tibed: Yes, I am very happy to be part of the coffee world. It is my passion, and what I am doing is what I love. The world of coffee doesn’t have borders or a limit, and I think that, beyond borders, we find the world of the coffee growers, of the entire world. I think that we have to communicate with producers, and help the producers to get the best prices for their coffees, and for me, personally, I would be really happy with this. 

Thanks to Aleco for helping me during the 5 years in Red Fox and for knowing so much about the world of the coffee. When I left Cecovasa, I thought I knew it all. Then, I realized that that wasn’t the case, and that there was much more. I think the world of the coffees is very ample and there is a lot to learn. And thank you very much.

Aleco: Beautiful Tibed, thank you very much. You will always be part of the Red Fox family. And you will always be my brother as well. Thank you very much for your time, and for sharing the stories with us. Ali, I don’t know if you have anything else.

Ali: No, thank you so much Tibed, I hope you have a beautiful afternoon.

Tibed: Ok, thank you so much to you too.

Aleco: Thank you! Bye!

 

To learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.

 

Puno, Better Than Ever

Puno coffee—if you’ve had it, you know it’s unforgettable. Puno is one of the most exclusive and renowned growing regions in all of Latin America, and while we buy all the volume we can from our producing partners there, there just isn’t that much. The coffees are some of the best we taste all year not just in Peru, but in the whole world. Puno coffees have a dedicated following and are typically gone before they arrive, so we may not talk about them very often. But Puno, located in the South of Peru where Red Fox started, is a huge part of our story.

Members of what is now Red Fox had been working in neighboring Southern Peru region Cusco since 2006, but were pushed out in 2007 by a large, corrupt cooperative union that ruled the Cusco region and all the groups within with an iron fist, preventing us from buying coffee at higher prices and maintaining traceability. When we were pushed out of Cusco, we connected with trade partners in Puno and started working there in 2008, meeting producers and tasting their coffees, which were (and are) truly exceptional.

After tasting the incredibly floral offerings that come from Putina Punco at the 2008 National Cafe Y Cacao board competition, which governs coffee trade in Peru and held an annual COE-style competition and auction 10 years before the inaugural COE Peru, we met with Tibed Yujra, who was at the time the head of quality control for a large cooperative union based in Puno. During that visit, we cupped through a veritable ton of coffee with the cooperative: the ten best, they sent back to auction, and the rest, we bought. We’ve been buying Puno coffees since then.

Over time, we struggled with the cooperative union in that area, and they dealt with high turnover. Tibed left and did consulting and QC work elsewhere, and we met back up with him in Cusco after that region reopened to us, coming to work for us shortly thereafter. We discovered that the cooperative union we worked with in Puno wasn’t paying the full prices back to producers that we had promised and paid to the organization. After a few years navigating the situation in Puno as best we could and trying to get money back to the producers, Tibed left Red Fox and started his own company in Puno, helping us connect with producers and make sure they get paid the prices we promise them as well as helping them maximize the coffee’s potential. This year, we’re more excited than ever about Puno.

Puno, and specifically the subregion of the Sandia Valley where the producers we work with live, is home to some of the original Bourbon the UN brought there in the 80s in order to combat the growing coca trade. Because the UN isn’t a coffee organization, they brought Bourbon instead of the hybrids that became so ubiquitous throughout Latin America, a decision that was key to the coffee landscape as it currently exists. Most of the farmers there are smallholders, growing on an average 2.5 hectares of land.

The reason there’s so little coffee coming out of Puno each year is that despite the UN’s efforts, the coca trade has since reclaimed most of the Sandia Valley. The farmers we work with are some of the last coffee growers in the area. While some farmers are coerced into growing coca, others are understandably attracted to the faster, multiple growing seasons and higher prices coca promises. We’re excited to see Tibed organizing to make sure fair coffee profits get back to the farmers remaining in Puno and we see many good things on the horizon for this unique subregion this year and into the future.

In addition to Putina Punco, we buy coffee from Massiapo, Quiquira, and Yanahuaya, all within a relatively close vicinity within the Sandia Valley. Sandia Valley flavors are extremely dynamic, more so than any other region in Peru. The Caturra coffees in the area have a prolific combination of sweetness and acidity, with dark fruit character like both red and black currants and a crisp, apple character with both weight, sweetness, and a refreshing malic acidity like both apple and pear. When you roast them, they’re complete and balanced as well as nuanced and dynamic. That’s what the Caturra is like, but when you hit pockets of Bourbon you find coffees that come with flavors you associate strongly with East Africa: floral, complex, and intensely sweet, like honeysuckle and hard candy. They may not have the level of complexity to the acidity as Ethiopian coffees, but the dynamic of sweetness is unmatched.

 

Interested in sourcing coffee with us? Reach out at info@redfoxcoffeemerchants.comTo learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.

Marilu Lopez Padilla of Coopbam, Peru on Covid & Women Leadership

We were lucky to get a chance to bring Marilu Lopez Padilla, Coopbam smallholder producer and Women’s Committee leader, onto the Foxhole for a conversation about the challenges created by Covid-19, her role in Coopbam’s formation, and her leadership in the creation of Coopbam’s Women’s Committee.

Marilu is an exemplary member of Coopbam, a cooperative founded with help from environmental group Conservation International to help support and protect the forested coffee farms within the Alto Mayo Protected Reserve in Amazonas and San Martin, Peru. From its founding, the group’s core focus has always been how to marry coffee growing with the enrichment of both the land and the community, rather than stripping the environment of resources in order to farm it. Marilu speaks to how the cooperative structure and the role of women in communal economics serve that mission, as well as the challenges they face perennially and this year in particular. 

Ali Newcomb: Hi everyone, I’m Ali Newcomb, director of Red Fox Sourcing Company in Peru and Mexico. I’m here with Carina Barreda, who helps manage quality for Red Fox in Peru. Also joining us is our very special guest, Marilu Lopez Padilla from Coopbam in Amazonas, in the North of Peru. After a break, we restarted the Foxhole last month with the new concept of focusing directly on the people who produce the coffee that we all enjoy so much and letting them speak directly to the people who drink their coffee. Right now we are right in the middle of Peru season and so we wanted to invite someone from our supply chain in Peru. Marilu is a crucial member of Coopbam,  the group with whom we started our work in the North of Peru. Marilu, thank you so much for being here and sharing your time to tell us your experience. 

Marilu Lopez Padilla: Thank you Ali, I’ll introduce myself as well. My name is Marilu Lopez Padilla, I am from the committee of Beirut, in Amazonas. Thank you for having me here.

Ali: Marilu, Coopbam has a very different history than many other cooperatives in the sense that it is in a protected forest, and because of that, it has a key focus on protecting the local ecosystem. Could you tell me a little bit about the history of Coopbam and how it started?

Marilu: Before Coopbam, I didn’t have any stable customers for my coffee. We would sell to whomever would arrive ready to buy it. Sometimes it was for really low prices and sometimes for higher prices. Often, we had no choice but to sell to whomever would show up. 

One day, Edwar, the promoter for the Beirut committee, appeared when I was washing near the road and he said, I think you sell coffee. I said that I do, but just a little, and there aren’t any dried coffee beans at the moment. Then he told me that he knew a buyer looking for dried coffee to be able to sell and that I could take advantage of it. He hadn’t explained the buyers yet and I didn’t know what a cooperative was at that time, but thanks to Edwar I started to understand that they were planning to open a cooperative and were looking for coffee to start it. 

He explained the details and since then, we have been working with trust. Now I say it again, in front of Edwar (who’s holding the camera), I can’t distrust the cooperative because I am always sure that it is truly cooperative and they do it for all of us, and amongst all of us, so we are all united—that is why I trust the coop.

Back then, before we established that trust, Edwar came to take my coffee and as I waited for results and payment, I kept asking him when he would pay me. He took my coffee and days went by. Soon, they did pay me and the cooperative officially started the following year in 2017. By then, it was more known in the area and many wanted to become members and build committees. Our coffee had a guaranteed market from the cooperative, and we continued and continued and I always believed in my coffee, and I still believe in it. 

Carina Barreda: Marilu, from when you started working with Coopbam to today, how has your coffee production changed? How do you see your development?

Marilu: I am very happy with the development from the beginning to now. We learned things from the cooperative like managing planting, how and when to fertilize, to do everything on time and to be on top of the harvest so we can get a good product and to not to abandon the farm: the to-do’s of the farm.

Ali: In the Beirut subregion, what are your biggest producing challenges, especially for producing quality?

Marilu: When it comes to the harvest, we have to be really on top of it. Once it starts ripening we have to be there consistently. If not, when the winter comes, the coffee starts falling. In Beirut, parrots will come eat the coffee once it’s ripe—that is a big difficulty for us because we have to be ready to run over quickly and scare them away no matter what else we’re doing. It means we have to pay attention constantly.

 Ali: It seems like you do a great job managing the parrots and everything else. This year, the world is upside down and I think there have been more challenges than ever, no? I know Peru had one of the longest quarantines in the world and I know that in the rural areas, additional preventative measures were  taken. Can you tell us more about how things are there both on a daily basis and also the challenges that have arisen over the course of the season?

Marilu: We had many difficulties because of the pandemic. We are farmers, country people, and many say that in the countryside people live happily, and that is true in some ways, but not in others. Yes, we are less anxious because we are in the countryside. On the other hand, we have difficulties and we need help as well: sometimes for our children, other times for the house, and sometimes for other things like not being able to go out and shop for what we need. During the harvest, it was difficult because we needed to go out to other fields to help with labor there, but we were surrounded by policemen, rondas campesinas (groups of peasants that patrol to keep the countryside safe), and the army. 

To this day, we have the army nearby. From my house, you can see the army—they are always paying attention, they don’t allow people from outside to come in. 

And while that has created difficulty, maybe it has been because of that, and thanks to God, that we are all still safe and there haven’t been any cases of this illness in our area. We are still taking care of ourselves, respecting the protocols as the president mandates. He asks a lot of us, our people, and we don’t understand much about it. But we all take care of ourselves and we are in the front, fighting it as well as continuing our jobs at home and at the farm, for our own good, for our families’ health and ours.

Ali: Well, it makes me happy to know that you haven’t had any cases of the virus in Beirut but it sounds complicated as well; so you haven’t left Beirut? 

Marilu: No, we’ve stayed here. For example, we haven’t been able to attend a cooperative meeting since March. I’m a representative in the administrative council where we usually have many meetings, but none since March. Schools are now virtual here and my little girl is about to start her first year in elementary school. She is here studying virtually from home, and my son is also studying college virtually in Chachapoyas University. We are all here, all together with them.

Ali: How are you doing with the virtual school? Do you attend via TV? On the radio? How is it held?

Marilu: I am going to tell you this but it’s going to make you laugh—I don’t have a TV. The signal doesn’t reach here, so I don’t own a TV. The virtual classes that my little girl has to attend, I borrowed a radio so she could listen. I can also listen so I can help her with homework. The signal isn’t very clear but we make anything possible. We make it work.

Ali: So besides producing coffee, you have become a teacher.

Marilu: Yes, I work a bit as a teacher, a bit on my farm, a bit taking care of my house, doing all the chores and doing a little bit of everything.

Carina: What help or benefits have you received from the cooperative during these last few months, related to the pandemic? 

Marilu: They have brought us baskets with staple goods and supplies. Thank God we have been able to get something, I am very thankful. It has helped me tremendously.

Ali: Marilu, can you please tell me more about your work in the Women’s Committee at Coopbam?

 Marilu: We coordinate between the women of different regional committees to be able to expand and diversify our communal livelihood. Some members wanted to do other work like crafts and planting vegetable and fruit crops; it is so essential for the health to have fresh vegetables and we prioritize it when planting in our orchards. So that was our idea: different committees for different projects, for example, a committee for creating vegetable plots, another committee to make artisan crafts, and another committee to raise poultry, all of this to generate diversified sources of income. 

Because as women we always think, the most important thing is not to lack anything at home.  As a group we had plans to do many more projects through different committees this year, but as you know, this pandemic came and delayed a lot of that. I’m sure that as soon as this passes we are going to continue improving and conversing about many projects we will do. And the committees agree as women, to do it and fight to be able to go on.

 Carina: How did the idea come up about building this Women’s Committee? Who was the person who managed or who pushed for the development of this committee and what was the goal?

 Marilu: Well, the cooperative always talked about this, during our trainings. There are men who are married to coop members, but not all the men are members of the larger cooperative—sometimes the husbands aren’t the members, the wives are. In my case, I am by myself, but I am a member and I am also the president of the Women’s Committee, and I manage this role differently from being a cooperative member, but it is equal. 

That’s what gave us the idea, because we have women who are coop members but we wanted to broaden the group to include the non-member wives of the men who were coop members. We all wanted to do something for our lives and our finances, we are always in need of things and that was our agreement: the women who want to work united to do jobs cooperatively and get better at them. For example in 2018, our women’s group grew and sold over 200,000 seedlings.

A lot of us in the community are happy that we are producing all that we are, as committee members. Like those seedlings: in order to grow a seedling, it doesn’t happen from one day to another. You have to be on top of it: fighting, working, group by group every day, just like that. That was our idea, so we could improve our livelihood. That is why we formed groups in Beirut, Vilcaniza, Yambrasbamba, by Aguas Verdes, and other places.

 Ali: What is your favorite part of being a coffee producer?

 Marilu: What makes me happy is having you as a set market of clients to buy our coffee. We have our buyers and believe in them, and you also put their trust in our product that goes to you. We always try to improve our product and see the best way to have it delivered to you with quality.

Ali: Would you like your daughter Ani to be a coffee producer when she grows up?

 Marilu: I would love that. My daughter has learned about coffee since she was small, she has a bright mind. She likes to harvest the ripe fruits; she knows what to pick and what to discard. You won’t believe me but she already bites into the dried coffee to assess the moisture.  When she bites into the dry bean, she says it’s already hard, or it’s already dry. I know with time she will learn more and that she will like it.  

Carina: What other objectives would you like to achieve in the near or far future either in terms of coffee production or other personal goals?

 Marilu: My goal is, that with the help of God, with the production that we perform here, I want my son to keep studying and finish with the profession he is pursuing, for my son and my daughter to keep studying always. Right now it’s very worrisome with the whole pandemic but we are fighting it as best we can with virtual schooling.  

Ali: Thank you so much Marilu. Do you have any questions or comments for us?

 Marilu: Just to thank you and thank God for giving us this day to be here with you and you with us. Let it be the first time we do this but not the last. The only thing I would ask you is, once the pandemic is over hopefully you can come visit us again.

 Ali: Oh yes, I am looking forward to it and Carina as well.

 Carina: Yes, absolutely. 

 Marilu: Thank you!

 

To learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.

 

Update: Valle Inca Covid-19 Donation Program

 

Through the Peru donation campaign we ran for the month of May, we were able to raise enough funds to help Valle Inca leader Prudencio distribute baskets with staple goods including rice, sugar, and cooking oil, as well as basic cleaning supplies like alcohol and soap, to all 127 Valle Inca member families.

The total dollar amount we raised seems tiny at $1,140, which works out to about $9 per member family. This is a great illustration of how a little can go a long way in a time of crisis. We’re grateful to be able to support Valle Inca in any way through this period and look forward to continuing to maximize our purchasing power however we can. 

Almost universally, producers we work with say the best way to support them is to continue to buy their coffee at Red Fox prices. As much as we can, the crucial work during this time is to maintain a similar level of commitment to these groups as in past years. If you’re ever interested in finding ways to help, get in touch. To learn more about Valle Inca, click here

 

Interested in sourcing coffee with us? Reach out at info@redfoxcoffeemerchants.com

To learn more about our work, check out our journal and follow us on Instagram @redfoxcoffeemerchants, Twitter @redfoxcoffeeSpotify, and YouTube.  

Newsletter: Secure Source: Peru

Peru is our fastest-growing origin in terms of project development and coffee procurement, and it’s what we think about when we think of the future of Red Fox. As of July 2017, we are now operating out of a fully-functional cupping laboratory in Miraflores, Lima. And in addition to our Quality Director for Peru, Tibed Yujra, we’ve recently brought on Ali Newcomb to run the operation as Gerente General. We’re looking forward to hosting any and all of you at our new Lima lab for a cupping. We can also facilitate field trips out to the many different regions from which we are sourcing. A new chapter for Red Fox has begun!

My first ventures into the Andean interior of Peru as a coffee buyer were in the south, almost a decade ago. Most other buyers seemed to be focusing on the more accessible regions of the north — Jaen, San Ignacio, Moyabamba, and beyond. Naturally, I wanted to head in the opposite direction. So I set off south, to the Sandia Valley of Puno, which remains our largest source of quality coffee in Peru to this day. When Red Fox started, we trekked up from Puno into the La Convencion and Yanatile valleys of Peru to discover new regions. As of last year, we made the decision to buy coffee in the north as well, albeit in regions and with cooperatives that have yet to be accessed by other buyers. The Alto Mayo Protected Preserve and the deep interior of Cajamarca are where we begin that adventure.

We’d like to shed some light on what’s happening with each of our projects and on the producer groups we’re currently partnered with. You’ll find rough harvest and shipping timelines, price ranges, and flavor profiles for each region below.

PUNO — Cecovasa

The Cecovasa Coop in the Sandia Valley of Puno remains the largest source of coffee in Peru for Red Fox. We expect anywhere from 40-60% of our total purchase volume to come from the now illustrious Tupac Amaru, Inambari, San Isidro, San Jorge, Charuyo, and San Ignacio cooperatives. Coffees from this region are the ones that have changed people’s minds about the potential of Peruvian coffee, potential that will soon rival Colombia in terms of quality in South America. Not only are floral, Ethiopia-like producer lots from Wilson Sucaticona, Pablo Mamani, Juan Quilla Laura, and Ciriaco Quispe turning heads, but so is the sheer longevity of coop and bulk lots from across the valley, like the Aprocafe Coop lot I’m sipping on as I write this. These are not your grandparents’ Perus of yesteryear that were a roll of the dice in terms of arrival quality. These are coffees that last, like the most solid Guatemalans and Ecuadors.

Peak Harvest Season: August – October
Shipping Timeline: September – December
Dry Mill Location: Juliaca, Puno (12,500 ft)
Flavor Profile: red apple, asian pear, red currant, dark honey, bittersweet cacao, black walnut

CUSCO — Incahuasi

My first adventure into the Incahuasi Valley was in the summer of 2006. It was a trek, almost 12 hours from the city of Cusco. Straddling the border with Ayacucho, which is now also producing coffee under the Incahuasi cooperative umbrella, the valley feels hidden and very off the beaten path. The potential for top quality on both sides of the border is undeniable. There’s as large a volume of 2,000 masl coffee production out here as I’ve seen anywhere on the globe. The cooperative leadership is open-minded and progressive, and since we’ve started working together we’ve seen annual improvements in drying, storage, and transport. Incahuasi has become a model relationship for us. Aromatics are intensely sweet, reminiscent of raw honey, ripe mango and baked cherry. Cup profiles in the valley demonstrate fresh stone fruit character, nectarine and cherry in particular.

Peak Harvest Season: August – October
Shipping Timeline: September – December
Dry Mill Location: Juliaca, Puno (12,500 ft)
Flavor Profile: raw honey, ripe mango, baked cherry, stone fruit, nectarine, cherry

CUSCO — Santa Teresa

Santa Teresa is the final stop on the trek to Machu Picchu. Just 30 minutes from Quillabamba, the heart of the La Convencion Valley, Santa Teresa sits at the base of the Templo de La Luna on the Urubamba river. A handful of the farms we buy from are strewn along a hidden pathway that was used to evacuate the Inka during attacks on the community. Needless to say, the landscape is stunning and steeped with powerful energy. The coffees as well. Like many of the farms we work with in the La Convencion Valley, altitude soars from 1,750 to 2,100 masl. Slow ripening through October develops saturated sweetness and ripe fruit character. This will be our third season working with the group in Santa Teresa, and we expect to see great improvement in terms of processing and delivery over the past couple years.

Peak Harvest Season: August – October
Shipping Timeline: September – December
Dry Mill Location: Juliaca, Puno (12,500 ft)
Flavor Profile: mango, peach, yellow plum, maple, muscovado sugar, creme brulee, toasted almond.

CUSCO — Grupo Calca

This year we will purchase a small volume of micro lots — less than a container load — from an old friend in the Yanatile and Lares river valleys of Cusco, Prudencio Vargas. Prudencio has done a miraculous job of organizing a loyal group of twenty farmers in this remote corner of Cusco into one unified association. Production from each producer rarely reaches 10 bags annual. Typica is the variety of choice, though Caturra, Bourbon, Mundo Novo, and the dreaded Catimor can be found in the region. These valleys are arid and desert-like, creating an ideal environment for drying and storing parchment coffee. Altitude in the area can reach 2,200 masl, and quality is utterly exceptional from the group, often exceeding 87/88 points. Think pure fruit nectar with high intensity of sweetness and acidity.

Peak Harvest Season: July – September
Shipping Timeline: September – November
Dry Mill Location: Juliaca, Puno (12,500 ft)
Flavor Profile: white grape, lemon/lime, satsuma, bing cherry, fig, brulee’d sugar, yellow honey, cacao nibs

CUSCO — Rio Mapacho

Last season’s Rio Mapacho lots turned a lot of heads. It’s a region that hasn’t been accessed much by specialty buyers, and we intend to help put it on the map. The cooperative is located deep within the Calca province just outside of Cusco’s Sacred Valley. The coffees are juicy and complex, often reminding us more of Sandia Valley coffees than of what we expect from Cusco cup profiles. Dark fruits like black cherry, currants, and plum are redolent in character, accentuated by dark honey and panela. Production is low at the cooperative — we expect anywhere from 200-350 bags of exportable coffee this season. No more. Those with interest here should respond quickly.

Peak Harvest Season: August – October
Shipping Timeline: September – December
Dry Mill Location: Juliaca, Puno (12,500 ft)
Flavor Profile: black cherry, black currant, plum, dark honey, muscovado sugar, marshmallow

ALTO MAYO — Coopbam

The Alto Mayo protected forest spans the border between the San Martin and Amazonas departments of Northern Peru. It is home to a large cross-section of native Peruvian wildlife as well as some of the country’s last undiscovered coffee. We were initially introduced to the area as part of the Alto Mayo Conservation Initiative funded by Conservation International in an attempt to save the native coffee production. Altitude in the low-lying areas (1,400+ masl) is conducive to sweeter, balanced cups with finer levels of acidity. Altitude in the higher reaches (exceeding 1,800-1,900 masl) produces coffee of elegant quality. This is a very wet area, and we’ve put great emphasis on drying and storage since beginning with the group. It’s beginning to pay off. After purchasing just a small volume of coffee last year, we’re on the verge of something more substantial this season.

Peak Harvest Season: July – September
Shipping Timeline: September – October
Dry Mill Location: Chiclayo, Lambayeque (sea level in dry, stable, desert-like conditions)
Flavor Profile: prune, raisin, meyer lemon, cacao nibs, high percentage cacao, vanilla, toasted almond

CAJAMARCA — Rutas del Inka

There is a lot to be amped about in Peru this year, but I keep coming back to our newest relationship out in the deepest reaches of Cajamarca. The Rutas del Inka cooperative is only a couple of years old, but leadership is strong and potential for quality coffee is off the charts. Altitude soars up here, with the majority of coffee production hovering right around 2,000 masl. Farms are on the younger side and are very healthy. All indications point to very special coffees on the horizon. We’ve just begun cupping the early harvest samples and are still learning the regional cup profile. Our first take is that cups are laden with juicy, refreshing acidity and ripe dark fruits like currants, red grape, and plum. These are powerful coffees driven by bright high notes.

Peak Harvest Season: August – October
Shipping Timeline: September – December
Dry Mill Location: Chiclayo, Lambayeque (sea level in dry, stable, desert-like conditions)
Flavor Profile: red grape, black currant, yellow plum, wildflower honey, vanilla, toasted almond

Tibed has made a handful of additional visits to regions all over the north, from Jaen to San Ignacio and beyond. He’s been cupping in local competitions in areas across Cusco that are newer to us. He’s plotted coffee on his altimeter above 2,200 masl in the Selva Central. The seven relationships noted above are our core group, but we’re always on the lookout for something new and beautiful to discover.

Cheers!

Aleco

Newsletter: Harvest Update & Delivery Schedule Peru 2016/2017

Greetings from the Fox Den, where we are in the thick of the South American shipping season. Lots from Colombia and Peru that we approved earlier this fall are starting to arrive on both coasts, and we’re sprinting to keep up with the influx of new samples from later in the harvest. In Colombia, where the harvest season lasts much longer, our offerings are spread out more evenly and ship more consistently. We already have coffees available in the warehouses on both coasts and will continue to ship a couple of containers per month throughout the winter. The buying season in Peru is much more intense and compressed. With our primary focus on the southern departments of Cusco and Puno, the vast majority of what we buy is from the peak harvest in August/September/October. Our time is devoted to filtering and approving Peru samples in both Lima and Berkeley from September through November. We just received our last batch of Peru offer samples in our Berkeley lab and, if all goes according to plan, we’ll finish cupping and send our instructions to the cooperatives by the end of this month.

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2016 POST-HARVEST REVIEW

We have put a new system of filtering samples in place in Peru for the 2016 harvest. It’s designed to make us more efficient at analyzing and approving samples, bulking lots and selecting micro lots, and, perhaps most importantly, at ensuring that stable coffees are milled, packaged, and shipped in the most timely manner.

The work begins with our field agent, Tibed Yujra, who is based in Puno and engages daily with the producers, cooperative leaders, millers, and exporters that we work with in Peru. Beginning right around the halfway point of the harvest season, Tibed begins collecting parchment samples from receiving stations throughout southern Peru. He takes physical measurements of all the samples to analyze water activity and moisture content, and excludes any samples that fall outside our specs. After this initial filtering, we meet up with Tibed in Lima to conduct a first round of cupping. All the coffees that we determined are “clean” at that point are brought back to the Berkeley lab for final analysis, where they are again measured for water activity and moisture content and cupped for a final time. It’s at this point that we determine which lots should be kept separate as micro lots, and which can be bulked by cooperative or region. Results and milling instructions are immediately sent back to the the cooperatives, and coffees are dispatched to be prepared for shipment. Tibed is waiting for these lots as they enter the dry mill to assure that a proper job is done. So far we’ve found this new system to be faster and better organized, and we’ve trimmed 2-3 weeks off of the entire process compared to last season.

Storage conditions for our coffees in Peru are ideal. The coffees are kept in very dry, cool climes prior to milling — between 2800 masl (Andahuaylas) and 3400 masl (Juliaca) — and most coffee is milled in Juliaca itself. Many of you who have bought Peruvian coffees from us in the past have remarked at the impressive longevity of these lots. We think the explanation is the excellent milling and storage conditions, along with Tibed’s ability to move coffee from the interior to the dry mill to port at what seems like the speed of light.

We spent time this season trying to solve the water activity issues that plagued some of our coffees from the 2015 harvest, and on our first trip to Peru this year we discovered some excessively fast drying practices in La Convencion, Cusco. Coffees were being dried on patios in direct sun in just 3 to 4 days and, while the coffees were reaching the proper moisture content in that time, it was wreaking havoc on the stability of those coffees. Even drying is more important for overall longevity and quality than a target moisture level, and water activity is a far greater measure of stability for us for this reason. We find that drying coffee at such an extreme rate doesn’t allow for an even distribution of water within the coffee bean, and we think slower drying times — we recommend a minimum of 8 days — equate to lower water activity, a longer lifespan, and greater freshness for green coffee.

At our request, the cooperative in La Convencion has installed raised beds in most of the washing stations they operate, and they are covering the parchment at midday to protect it from the ultra-intense sun. Where raised beds couldn’t be installed in time this season, they are drying parchment in larger piles to slow down the drying times. Overall, the results are markedly improved. We have adhered to a strict protocol with water activity this season, and only accept coffees that measure between 0.50 and 0.59. All coffees shipped this season are within this range.

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CUSCO

Cusco is the future. It’s like a brand new origin for the ultra quality-focused buyers out there. We’ve written before about the monumental implosion of the old cooperative union. Now a handful of new cooperatives have risen from its ashes, and they’re looking to connect with the specialty market. We have built strong relationships with two of these cooperatives, and hope that more will come with future harvests.

Altitude in Cusco is supreme. I don’t know a region in Peru that has more 2000+ masl producing zones. Scratch that. I don’t know another coffee producing region in the world with as much 2000+ masl coffee. Our focus to date has been in the La Convencion area of Cusco, an absolutely gigantic swath of coffee-producing land. We’ve spent days on end driving in and around the producing valleys within La Convencion, seeking out the hidden crevices. They are the most epic areas in the coffee lands that I know.

The two cooperatives we currently work with in the department of Cusco are both on the southern end of La Convencion. Though they seem close to one another on the map, the distance between is quite far in reality. They’re separated by a rugged 10+ hour drive across altitudes upwards of 15,000 ft.

On one end of the journey, just over the Cusco/Apurimac border, is the Incahuasi Valley. The valley has an otherworldly beauty, like being on another planet. The feeling of escape from the rest of the world out there is unlike any other place I know. It’s just the producing community, the coffee, and us when we visit. No interruptions. After a long hiatus buying from this group, we got back into the swing of things two years ago. The connection between the producers, the cooperative leaders, and Red Fox is strong, and this year they will be our largest provider in all of Peru.

The three main communities within the Incahuasi Valley are Pacaybamba, Amaybamba, and San Fernando. Each has its own centralized wet mill where producers can deliver their cherry. A smaller portion of the associated farmers process cherry at their own farms in a similar fashion to what you’d encounter in Colombia: manual depulping, fermentation in small tanks or buckets, washing by hand, and drying on raised beds. Baseline altitude for most of the valley is 1900 masl, and the peaks above San Fernando are home to some of the 2200-2300 masl farms. Being isolated from most other coffee production in Peru means that the farms in Incahuasi are planted almost exclusively with Caturra and Typica. Small pockets of Bourbon still exist as well.

At the other end of the long drive is Quillabamba, Santa Teresa, home to the Sacred Valley itself. The cooperative we work with in Santa Teresa is just 12km from Machu Picchu. While visiting farms this past June, Joel, Tibed and I were introduced to farms hidden along a secret trail built as an escape path down the backside of the old Inca fortress. The path was “discovered” by the western world in the 1980s, but was well known and farmed by three generations of producers whose coffee we now buy. Altitudes are enormous here as well, exceeding 2100 masl at the top of this path and in the region in general. Small pockets of Bourbon and Pache can be found in greater Santa Teresa, though, like in Incahuasi, Caturra and Typica still reign supreme.

Wrapping up our second year of work with these folks, it’s safe to say that there is a lot of room for improvement, both in the infrastructure for coffee storage and drying and in the organization. A prior history of commodity buying means that this producing culture is just beginning to learn about and be motivated by quality. But we believe in the potential here, and we think this season’s offerings make that potential clear.

 

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PUNO

I would love to have started this segment by saying that if Cusco is the future for Red Fox, then Puno is our old faithful. Unfortunately, the entire Sandia Valley, home to all coffee production in the department of Puno, has been ravaged by roya. In light of the large risk that roya presents, many producers have pulled up their coffee trees and replanted their farms with coca, which has a higher monetary value compared to coffee, and yields multiple harvests in a single year. The producers who have maintained their coffee production are delivering a third or even a quarter of the volume they used to produce.

If there’s good news in Puno this year, it’s that the farmers who have stayed true to coffee have galvanized their communities towards a greater commitment to coffee production. The Inambari Valley in particular, home to the Inambari and Tupac Amaru cooperatives, is still producing strong volumes of beautiful coffees. The San Isidro and San Ignacio areas of Tunkimayo are still producing beautiful coffees as well. Staying true to our commitment to these producers has allowed us to increase the volume of our purchases from 650 bags in 2015 to 800 bags this year. It’s not much coffee in the grand scheme of things, but we hope that number will grow as harvests stabilize and yields increase.

Though the climate in Puno may be slightly wetter than Cusco, the peak altitudes are similar. The Sandia Valley is home to a wealth of 1900+ masl coffee. Caturra and Typica are the common varietals, though Bourbon plays an even stronger role in the genetic makeup of coffee here, thanks to a UN-funded replanting project in the 1980s.

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QUALITY

What we love most about Peruvian coffees are their unique flavor profiles. These are not Colombias and they’re not Bolivias. I’m hardpressed to compare Peruvian profiles to any other origin, unless it’s those floral Bourbons that remind me that the Ethiopian harvest is just around the corner.

Many of you have bought Puno coffees from us before, as that is the region that really put Red Fox on the map when it comes to Peru. These coffees are so so sweet, creamy, and balanced, with crisp but subtle malic acidity and elegant dark fruit character. ‘Honeycrisp apple’, ‘raisin,’ and ‘creme brulee’ are common descriptors for me. I’ve always found these coffees to be crowd-pleasers at well-roasted production levels. And they behave well in blends with other coffees, too. Punos are versatile and built to last for the long haul through winter.

The Cusco coffees are the lively ones, showing off that racy, ripe-fruit character that is so appealing on the cupping table. The Incahuasi lots demonstrate the whole range of yellow fruits from peach to mango, along with dried fruit notes of golden raisin and apricot. The sweetness of these profiles runs from brown sugar to wildflower honey. These are our brightest coffees from this origin.

I can’t stress enough that these are the coffees that always surprise people in late spring, when they help to bridge the gap between the winter menu and the arrival of new crop centrals. The high-altitude storage, swift shipping, and our extra attention to ensuring stability make these coffees something to count on year after year.

DELIVERY SCHEDULE

The first wave of shipments has arrived on both coasts and will be clearing into Continental Terminals and The Annex in the next week or so. These coffees were dry-milled and packaged in Juliaca at 3400 masl in early October before being sent to the port in Lima.

The second wave of shipments, which represents the bulk of our purchases from both regions, is either afloat or in the dry mill now, and will begin arriving on both coasts in early December. The second shipment of Puno coffees was milled in Juliaca in mid-November. The second wave of Cusco lots was prepared under Tibed’s careful supervision in Lima. These coffee spent a total of 12 days in Lima before being loaded and shipped from Callao.

A third and final shipment, exclusively from Puno, will ship in December. This coffee will also be milled and packaged at 3400 masl in Juliaca and will arrive just after the new year.

Most of the coffees on offer are organic certified, and many also have Fair Trade certification. Please inquire with us about which lots are certified.

Newsletter: Peru 2015 Shipment & Delivery Update

Back when Red Fox Coffee Merchants was still a daydream of mine, one of my more lucid visions was that Peru would become the defining origin for a nascent sourcing business. No other producing country fulfills the core ideals of our mantra so seamlessly: coffee-producing communities so far off the grid that they have been left behind by much or all of the specialty market; quality that has the potential to change the way people think about coffee. Getting around Peru is more difficult than any other origin I’ve ever worked in. And, yes, that includes Ethiopia, Indonesia, and everywhere else. The south is particularly tricky to traverse. Each trip involves several flights, dozens of hours in the car, challenging hikes to get in and out of the producing valleys. Visiting one farmer often takes an entire day.

Being a coffee farmer from the Sandia Valley in Puno or from Incahuasi or Huadquina in Cusco is as grueling a proposition as anywhere I’ve seen. Note the photo of Ciriaco Quispe and his homemade wooden cart, which holds 2 bags of parchment coffee — bags that weigh somewhere around 40kg each. Ciriaco’s farm is a 90 minute hike off of the main road on a rugged dirt trail at what feels like a 90-degree angle, and it yields roughly ten 69kg bags of 1st quality exportable green coffee a year. Let’s use the standard translation of 70% parchment to 1st quality green to estimate that Ciriaco makes this trip at least 12 times a season to deliver all his coffee to the mill. This is the standard for coffee farmers across the greater Sandia Valley.

We think it’s important for everyone to understand what the reality is for these folks. We pay a whole lot of money in Peru because we love the coffees, because we know what it takes for farmers here to deliver their coffees to market, and because we think there is even more potential to develop.

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As many of you know, Red Fox added a full-time field agent, Tibed Yujra, on the ground in Peru going into the harvest this past spring. Tibed and I have cupped together since 2009, when I first began working in the Sandia Valley of Puno. Back in those days, Tibed was Quality Control manager for the entire cooperative society that we worked with.

We brought Tibed on board to help us acheive our vision for the country. There are more obstacles to overcome in Peru than in almost any other coffee producing country in Latin America, but the potential for top quality is equally as large. What are the prerequisites that a coffee buyer looks for when venturing into new territory? Elevation? Varietals? Microclimate? Processing technique? Peru has everything we’re looking for and in spades. Elevations soar well over 1,800 masl across the country and reach 2,200 masl in a few specific regions. Caturra and Typica are commonly found top to bottom in the Peruvian Andes, and one of the south’s best kept secrets is the abundance of Bourbon. The Peruvian Andes are more arid than most, allowing for proper drying and storage conditions. We are often conditioning parchment at over 10,000 feet. Processing in our projects is similar to Colombia in that it’s done very simply with manual techniques. Drying on raised parabolic beds is also a commonality.

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This year Red Fox is working in three departments of Peru. Coffees from two of these regions are arriving now on both east and west coasts:

PUNO

Peru started for us in Puno. We were initially, and still are, attracted to the potential for micro lots with dramatically floral character. I sometimes refer to them as ‘Junior Yirgacheffe.’ People occasionally confuse them for Geisha. They’re neither — I mean what is? — but that delicious confusion is thanks to the United Nations. In an attempt to rejuvenate coffee production in the Sandia Valley, a UN-funded project brought the aforementioned Bourbon seed stock to producers in the region during the 80’s and 90’s.

Along with these unique, floral-driven coffees we also find coffees that are filled with fresh cream, fine chocolate, black walnut, toasted sugar and a range of fruit from red apple to apricot to raisin. They cup very solid on the table, but they brew even better. We encourage you to put these samples through your harios and kalitas after you cup. It adds perspective.

Within Puno is the Sandia Valley, which is due north of the department capital of Juliaca, saddled right up along the border of Bolivia. Within Sandia are several other valleys that we work in, from Inambari at the southern entrance to Tambopata further north. There are thousands of farmers producing in the valley, but we work with a select number who have the elevation and varietals we’re looking for. Our selection process is ultra-intensive. We’ve screened well over 1,000 samples this fall, with an approval rate of approximately 10%. We’re more strict this year than we’ve ever been when it comes to cup quality, water activity, moisture content, and physical preparation. These lots are clean and stable.

CUSCO

My very first trip to Peru was centered around an adventure to the Incahuasi Valley of Cusco. It’s a 10+ hour drive to get out there from the city of Cusco; a drive that takes you from the Department of Cusco into Apurimac before winding its way back into Cusco. It’s one of the more epic rides you can take as a coffee buyer, especially the crossing over the altiplano at 15,000 feet. Breathing is not to be taken for granted up there.

I took two trips to Incahuasi in the summer of 2006, but the outcome was disappointing. A large trade organization that was not open to outside buyers working directly with farmers pushed us out of the region. They were an immovable obstacle in the road to transparent sourcing.

In 2014 that group disintegrated, a moment I had personally been waiting for since my initial visits, and now not only are we able to trade directly with farmers in the Incahuasi Valley, but Tibed and I are focused on scouring the rest of the Department for its finest coffees. Our search has taken us to the Yanatile Valley as well as to Ocobamba and Santa Teresa. There is a treasure chest of amazing Cusco coffees that we can’t wait to bring to market in the coming years.

Elevations can reach well over 2,000 meters in the region, and there are small pockets of Bourbon to be found, along with more widespread Caturra and Typica. These coffees are exciting and demonstrate an entirely different cup profile than their neighbors to the south. The range of flavor begins with a bounty of yellow fruits from mango to peach and apricot to meyer lemon. Muscovado and darker sugars and honeys drift through the profile from start to finish.

We’re really proud of where our projects in Peru are now, and we’re very happy about the qualities we’re bringing in. These are coffees that will bring a whole lot of life to your menus throughout the winter. Please email info@redfoxcoffeemerchants.com for samples.

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