Sunday, January 30, 2011

Introducing Fair Trade high above the Clouds


In the last posting, I wrote about Vie and Basil Reyes’ approach to localizing Fair Trade as a step-by-step process. I was interested to learn more about their work so we went to the northern mountains of the Philippines to meet their partners and see their coffee roasting machines in local communities. What I found clarified much about the step-by-step process they were speaking of when I met with them.

Chou and I took the 9-hour overnight bus to Banaue, one of the Seven Wonders of the World. It is only an hour up the curvy mountain road from Lagawe in Ifugao province, so I might as well enjoy the sights while conducting my inquiry! Besides, this trip is self-funded, so I can set my own agenda... Perks aside, the inquiry went forward a day later.
In Lagawe, I met with Father Valentin and Father Marion, priests at the local Roman Catholic parish. I was interested in what they were doing and how they came about forming a local farmer’s cooperative, CoRDI, which is  both a short reference for Cordillera Mountain range and Coffee Research and Development Institute. We met over a freshly brewed coffee sitting at the KAPEHAN, the small café situated on parish grounds between the church and the school. Father Valentin holds Master’s in Development Management and established the Social Action and Development Center which is run out of the parish. Upon meeting him I quickly realized this was no regular priest! 

He explained his involvement in the local community, “Since 2001, I involved myself in the promotion of Indigenous Peoples Rights by conducting Indigenous Peoples Rights Act (IPRA) education… I also involved myself with environmental education and monitoring of government projects because we are trying to promote good governance. Later we tried to do political education, especially during the elections. We are trying to explain to people regarding the patronage politics that influences all aspects of our life, especially in development direction.” 

Like many countries around the world, patronage politics is the Achilles heel of democracy. Father Val explained, “Politicians run for office, but it is too expensive, so who will support them? Contractors, gamblers… [Once in office] politicians decide on development projects based on the needs of the contractors. We call them ‘juicy projects’ because instead of responding to the real needs of people, they are responding to the financial interests of the contractors.”
 
I could understand the interest a Catholic priest would have in promoting good governance, but I was curious how the Social Action and Development Center got involved in coffee production. He shared his experience in conducting environmental education with people living high in the cloud forests of the Cordillera Mountain Range. “They were converting their forests into vegetable gardens. Of course we asked why. They said that it is because they also wanted to survive. We asked them what were the alternatives, and our approach was from the perspective of faith and religion. We said, ‘Look, God created everything, and He made everything for us to survive. Now we are destroying it.’ They said, ‘How can we survive also? We have needs like food, education for the children, health.’ I asked them to list their existing resources and they named several fruits and coffee. For the fruits, we convinced them to have training in Sante Fe on how to harvest fruits, to turn fruits into jam, juice and fruit preserves. They went back and they were successful. We thought since they were successful, we needed to introduce another source of income, and we went into coffee.”
Father Marion, interim manager of Cordi Cooperative
I was impressed! I was speaking with a Father who was very in-tune with the needs of his flock. Typically the people in this area needed only one hectare to support their family, and Father Val inquired as to why they needed more and turned to tearing down the forest. “I found that the rich people, the capitalists, come in and offer capital for the farmers. They would say, ‘do you have a forest?’ The farmer would say yes. ‘Do you want to convert the forest to vegetable garden?’ And the farmer would say yes. ‘Then cut down the trees’ and later come in with the heavy equipment to level the land. Then they would say, ‘here is your capital for vegetable seeds and inputs like fertilizer and pesticides’. At harvest time the capital provider would say, ‘I will bring the truck and carry your vegetable to the trading post.’ Then afterward, the capitalist would say, ‘this is the remaining balance.’ It was a very small income for the farmers for four months labor. The farmers realized one hectare is not enough, which was the intention of the capitalists.

My question is this; why is it that you hear in Manila the price of the cabbage is around 30 or 40 Pecos per kilogram, even 60 Pecos, but here in the trading post it is 5 or 10 Pecos? It is a very big difference. No wonder the farmers say that one hectare is not enough and have to clear more and more.
Ifugao Kape, product of the Social Action and Development Center
Father Val went on to discuss the role of a syndicate that is controlling the local trading posts and shipping the mountain grown vegetables to Manila. We also discussed possible alternatives, such as his fruit jam and preserves project. Those are sold by the Sisters at the Good Sheppard in Baguio, the nearest city halfway to Manila. “The sisters are trying to help the farmers and for those producing organic food. Good Sheppard Sisters is an established outlet. There are many food products there, and one on display is Ifugao Kape.”
Father Marion, me, Father Valentin and the user-friendly Bote Central Coffee Roaster
With the coffee roaster from Bote Central, the enterprising priests have set up two coffee brands made by CoRDI. Lagawe Blends is made by the cooperative and sold locally at KAPEHAN. Ifugao Kape is the brand made for the Social Action and Development Center, and the market range for this premium blend reaches into neighboring provinces. In the discussion, they confessed their need to work on the marketing side of the venture. Chou and I decided that one thing we could do was buy ten bags of the Ifugao Premium Blend, and give them away to possible buyers and retailers we come across in the journey. 

When we returned to Banaue, we sat with the owners of two lodges listed in the Lonely Planet – that influential guidebook that exerts an inordinate amount of influence over backpackers from all over the globe. Both were receptive to our sales pitch advocating they buy and promote coffee grown and roasted by their neighbors. We even did the calculations of scoops per cup. Selling a cup of freshly brewed coffee for 35 Pecos (US $0.80) would net them over 500 Pecos per bag in profit. Admittedly, it was a bit strange for the lodge owners to be given a sales pitch by a couple of dusty tourists toting the coffee roasted from an hour down the road, but we had fun. We gave away all ten coffees on our journey back south with contact information to reach Father Val. 

During our two day stay at the Parish, the Fathers also shared with me the inner workings of the cooperative, prices paid to farmers for Robusta and Arabica coffee beans,  limitations and profit margins, challenges they have encountered since they were established a little over a year and a half ago, and the origins of the project.  Father Marion noted, "planting coffee in Lagawe as a business venture began in the 50's, years before any roaster was introduced in the community."
Sharon in Coffee Heaven!
The Philippines adopted a One Town One Product promotion to encourage rural development. The OTOP promotion for Lagawe was designed a team led by Sharon Grace. “Fortunately when the new mayor was elected he came to me to ask what the OTOP should be. He wanted to change to making handmade brooms but I was able to convince him to stay with coffee. The new mayors usually want to change everything, to make their own mark on the community.” Father Marion added, "He did not change it but made the program more strategic. Mayor Cabbigat of Lagawe and his team proposed a new direction for its OTOP--to produce Arabica-Based Coffee Blends or in short Lagawe Arabica Blends...Thus,in partnership with the department of Trade and Industry and SN Aboitiz Power Inc, the coffee program in Lagawe began to take shape. Lagawe Blends became the brand that preceded coffee brands in Ifugao. Another brand -Terraces Brew by Unique Cooperative was also introduced almost at the same time and it was generally marketed in Banaue, Ifugao."

Under Sharon’s guidance, the LG, or local government unit spearheaded the development of Lagawe’s coffee enterprise, establishing minimum prices paid to farmers for organically grown high quality beans. Father Marion explained, “When the time came to make it a business, the government had to create a cooperative, or to tap local investors to put into the OTOP. So we created a cooperative.  We have 71 members now.”

Although Arabica brings in twice the price per kilogram, the farmers have 2-3 Robusta coffee trees on their lands left over from the Halcyon Days when the Philippines was the number 2 exporter of coffee in the world. To revive those neglected trees takes an effort, but it is an immediately available resource. In addition, CoRDI farmers are planting Arabica with great care to ensure they meet the requirements for organically grown. 
 
Father Marion explained that CoRDI had to accept a few provisions set by the LG in order to take over the business venture started by the LG. One was to maintain the prices paid for green coffee beans. “Last year when the farmers realized when we bought their coffee direct from them, they were surprised. The LG started buying for 100 Pecos / kg for Robusta while Nestle was paying 65/kg at that time. They were surprised, but it was in the general interest of the farmers.  LG set the pricing and we had to keep up all the programs and the pricing.” 
Arabica Seedlings!!!
Another requirement was to continue the reforestation efforts. After our discussion they showed me around the premises. Walking by a nursery on the way to the coffee roaster behind the church Father Val noted, “We have already produced over 20,000 Arabica seedlings and distributed them to the farmers who ask.” Reforesting with Arabica coffee, what a great idea!  It takes three years for the trees to produce, and in a few years, there will be a lot of Arabica produced in the nearby area of Tinoc. To this, Father Marion added, "In Lagawe, most of the 53,000 Arabica seedlings distributed and planted in 2009 died during the drought in 2010." Despite the setback, I see their ambition is far ahead of their marketing strategy, but in doing the work of the Lord, I suspect they will have an advantage in what will amount to be a venture in Fair Trade coffee.   

While learning about the challenges and functions of a cooperative, I inquired about Fair Trade. New to the concept, Father Marion admitted he was still in the process of learning about the principles beyond providing fair prices for farmers. Over the time we shared, my research with CoRDI Cooperative turned into an opportunity for capacity building and experience sharing. I spent many hours with Father Marion as he graciously took me around the area to meet local farmers, and allowed me to join him and Sharon Grace on a coffee buying expedition to a village near Sagada, a few hours’ drive away from Lagawe. 

For those interested in the coffee buying expedition, please go to my facebook page where Chou has posted many photos of our journey. Also feel free to connect with me there, I am always interested in meeting the people who read my blog.  
Sharon Grace and Father Marion let Chou and I join them on a coffee buying expedition
Father Marion summarized the mission of CoRDI, "We are working to establish a real local coffee industry in Lagawe, in Ifugao Province and in the Cordillera, in partnership with as many who share our vision and our concept that coffee can be a sustainable fuel for growth and that can be seen from a myriad of lenses or from many perspectives....from enterprise, from sustainable agriculture, from environment conservation, from eco-tourism..."

During my stay in Lagawe and in Sagada, I began to see more clearly the reason Vie and Basil Reyes make Fair Trade a step-by-step process that can take a period of 2-3 years depending on the community.

To say,
      "Fair Trade is about Social Change"
                                       is an understatement!

Locally, Fair Trade challenges a myriad of issues: the concept of business as usual; the role of women in the household, in society and within an organization; the participation of children in family operations; the role of organizational management and levels of participation by members/producers; and how to deal with partnering organizations and suppliers. Fair Trade is a game changer. Nothing remains the same once these concepts are adopted.

For Bote Central to introduce Fair Trade first by technically supporting local partners which depend 100% on their local economies, is as practical as it is useful. Their undertaking is nothing short of a commitment to initiating social change in every community they engage. Meeting with the partners, I saw directly the challenges and social issues they embrace. I also saw the value of localizing Fair Trade. 

I believe that Vie and Basil have begun moving Fair Trade in the direction it needs to go in the future if it is to be a sustainable endeavor. Complete dependence on trade with the North has proven to be unsustainable. Reflecting on the lessons learned from the recent Global Recession, I believe more attention has to be focused on developing Fair Trade in local communities.  Local outlets supported by local economies. I am not advocating for the end of trade with the North, but to introduce Fair Trade as a locally applicable model for doing business.  To diversify markets. 

As for introducing Fair Trade to a community, providing practical support and easily integrated guidelines is a good place to start. Fair Trade in action more than words.

Imagine this: 

Local beans, local processing, local roasting, local sales, 
and local consumption all contributing to a local economy. 

Not one bean exported, but Fair Trade localized! 

Thank you for joining me in this journey. Feel free to follow this blog and to add your comments, ideas or suggestions as we go.

Sincerely,

Mitch Teberg, MA

3 comments:

  1. Thank you for the post, Mitch! Its a comprehensive summary of the salient parts of the discussions we had. We should also add that planting coffee in Lagawe as a business venture began in the 50's, years before any roaster was introduced in the community. Then sometime during the 9-year term of Mayor Joaquin Dugyon enrolled coffee as the One-Town-One-Product of Lagawe.In 2007 when a new mayor came in, Mayor Ceasario Cabbigat, unlike most new leaders who would like to change everything, the new mayor agreed to sustain and recreate the coffee program as a one-town-one-product. He did not change it but made the program more strategic. It had an actual OTOP plan. It was in September 2007, 3 months upon asssumption of Office that Mayor Cabbigat of Lagawe and his team proposed a new direction for its OTOP--to produce Arabica-Based Coffee Blends or in short Lagawe Arabica Blends...Thus,in partnership with the department of Trade and Industry and SN Aboitiz Power Inc, the coffee program in Lagawe began to take shape. Lagawe Blends became the brand that preceded coffee brands in Ifugao. Another brand -Terraces Brew by Unique Cooperative was also introduced almost at the same time and it was generally marketed in Banaue, Ifugao. Fr. Val was right that Lagawe Blends was marketed locally--but that statement should have been --Lagawe Blends is also marketed locally NOW via KAPEHAN, the coffee shop. Previously, between the years 2007-2010, Lagawe Blends had reached many places outside of Ifugao already. AS IT WAS DESIGNED PRIMARILY AS A CORPORATE GIVEAWAY and a "PASALUBONG" item for the people of Lagawe. “pasalubong” means a gift or a token or a memento of travel...Lagawe Blends was initially bought in bulk and still continue to be bought in bulk by SN Aboitiz Power, Inc (the original partner that helped create this coffee brand)for their corporate giveaway. It was only recently that Fr. Val through a good proposal was able to get SN aboitiz to support SADC initiatives towards using coffee as a reforestation program --but in another area: in TINOC. Such that, we are all happy to see that from Lagawe, the concept of using coffee as a reforestation tool begins to spread to other areas of Ifugao. In Lagawe, most of the 53,000 arabica seedlings distributed and planted in 2009 died during the drought in 2010. CoRDI Coffee Cooperative began as CoRDI Group where CoRDI is actually an acronym and it stands for Coffee Research and Development Institute....the group carried its mission in its name. The mission was an ambitious attempt to try to establish step by step a coffee research center for robusta and arabica in Lagawe and in Sagada, respectively. And so we have began in 2007 to trek step by step towards this vision with local coffee enterprise and reforestation as twin goals comprising a vision of sustainable local community development. Well, it really is a long story but we can sum it all up by saying that we are working to establish a real local coffee industry in Lagawe, in ifugao Province and in the Cordillera, in partnership with as many who share our vision and our concept that coffee can be a sustainable fuel for growth and that can be seen from a myriad of lensed or from many perspectives....from enterprise, from sustainable acgriculture, from environment conservation,from ecotourism...
    Thanks mitch for the post and for the very interesting conversations...happy journey! God bless!

    ReplyDelete
  2. From 5 -10 pesos to 30 - 60 pesos, the difference is so high! By the way, I believe it should be Pesos rather that Pecos. Is it because of the transportation that they use for trading? These crops should be their fortune and thanks to Father Marion, they can get the proper guidance that they need. Now every crop would be a means for living.

    ReplyDelete
  3. Mitch, please send me the contact info to reach whomeverto converse about purchasing coffee,Ifugao Kape,directly from the source. Thanks.
    Charles Kennerson/owner
    www.philippinecoffeecompany.com
    www.pinoycoffeecompany.com
    customerservice@philippinecoffeecompany.com

    ReplyDelete