Coffee production is not new in Myanmar, but speciality coffee production is. Recently Myanmar has adopted new methods of harvesting cherries and processing coffee beans and starts to stand out for its high-end coffee in a global market.
U Myo Aye, chairman of the Myanmar Coffee Association, says demands for Myanmar’s speciality coffee has surged a lot, and it is being exported to Asian and Western countries.
“We sold coffee within small villages at a low price before. We never imagined that we were going to the U.S. and Europe to meet famous coffee buyers and companies. That is a significant change we have seen through this project.”
Speciality coffee generally means high-value coffee that is free from defects. In order to be graded, it should meet global standards and get a high score in a quality test. In the U.S., Europe, and neighbouring Asian countries, speciality coffee markets are already mature, and the demand continues to grow.
Just several years ago, Myanmar’s coffee communities had produced commercial-quality coffee.
It was not only because there was a lack of plantation maintenance or awareness of best practices. They also did not need to do that; they only catered to those who like three-in-one coffee containing coffee, sugar, and milk in powder form.
However, several organizations have begun to put more focus on the expansion of the coffee trade as the Myanmar economy has opened up. Especially over the past five years, there has been a marked improvement in the country’s coffee business.
In 2014, USAID and Winrock International, a nonprofit organization, started to work on a Value Chain for Rural Development (VC-RD) project. USAID provided a $27 million grant to Winrock to do this project. Its goal is to improve food security and increase the market competitiveness of agriculture products, including coffee, soybean, ginger, sesame, and melon in Myanmar.
They provided not only physical resources but also training, market linkages, and business skills, which impact on the coffee value chain. Experts have been teaching rural farmers how best to harvest and process coffee in a consistently high-quality manner, resulting in speciality coffee. They also put a particular effort to engage ethnic minorities and women at every step of the value chain from production to cupping.
“Our approach to agriculture development is to look at an entire value chain. We do not provide only technical assistance to farmers, that is just a beginning. We need to look at how to improve the quality, how to increase the yield, and how to promote products to market,” says Teresa McGhie, USAID Mission Director.
According to Winrock, as of January 2019, nearly 74 per cent of participants adopted one or more new farming practices or technologies including the use of improved seeds, fertilizers, moisture meters, and grain dryers introduced by VC-RD.
Shwe Taung Thu, the country’s first smallholder coffee enterprise, is among local producers who have benefited directly from the project. They have more than 300 farmers from 18 villages nearby Ywangan in Shan State.
With support from USAID, they could embrace proper drying technologies to make high-quality coffee, using a drying table and picking fully ripe cherries.
Domestic and international buyers are now paying quality-based premiums to the Shan smallholders. These premiums enable farmers to earn two-to-four times the prices earned before. The profit gained is using in education, community building, and environmental conservation.
“A big impact for us is that our Ywangan coffee can exist in the world map of coffee as a new Myanmar origin. We never hoped to receive the good prices before,” says Zaw Win Ko, a chairman of Shwe Taung Thu.
Now Shwe Taung Thu is emphasizing sustainable growth and continued success. They have raised their capabilities and experiences that are appropriate for the local situation.
“We are providing improved technologies to our members to maintain good quality. We will encourage farmers to understand the quality of coffee and the value of coffee as well as ownership,” he says.
Of course, there are many obstructions on the road. Productivity is currently quite low and inconsistent from the community to the community. In rural Myanmar, the frail infrastructure is not keeping up with the pace of demand for coffee as well.
“I remember that when we were trying to install the crop processing equipment, we were having difficulties with things like getting the electricity. It was hard to pump water because we could not find nearby,” says Nimish Jhaveri, VC-RD project’s chief of party working at Winrock.
Another is a finance matter. According to Winrock, the VC-RD project catalyzed more than $1 million in pre-harvest loans to smallholder coffee farmers through national and global banks, including working capital loans guaranteed by a major global social lender. However, high-interest rates are piling pressure on coffee stakeholders who need money.
Still, the future is bright for coffee in Myanmar. The people with the passion and dedication that we meet seem able to surmount any obstacle ahead of them.
“We also get 17 Arabica Q Graders including seven women graders by training them so hard. I am 49 years old but are still learning by the training to get good knowledge to make high-quality coffee. Education is software. It is not a machine. Coffee stakeholders should study to make high-quality products,” says U Myo Aye, chairman of the Myanmar Coffee Association.