Caravela Coffee

It is with great pleasure that we want to share with you the news that, for the second year in a row, a Virmax coffee had the SCAA’s highest scoring coffee of the “Coffees of the Year” award with a  coffee produced by farmer Carlos Imbachi, in his farm “Finca Buenavista”, from San Agustin, Huila.

Follow this link to the SCAA post announcing the winners.

Congratulations to the winners in each category.

From Virmax:

Colombian UGQ diffs have continued above 50 cents/lb during the last month. The scarcity of Colombian coffee and the continuous appreciation of the Colombian Peso vs the US Dollar (moving from around 1963 Pesos per Dollar at the beginning of June to 1840 at the end of July - a 6% appreciation in the last 2 months) are the main factors contributing to the firmness in diffs. The average differential during the last 12 months is 60 cent/lb.

With today’s close of USD 1.73/lb, expect to pay at least 2.36/lb (FOB) for your average Colombian UGQ …if you can find any. Supremos are even more expensive at USD 2.55/lb (FOB) due to the bad physical quality of what’s being produced.

The second semester harvest in Colombia is under way!  I was in Huila and Santander a few weeks ago to see how the harvest was looking and to meet up with the guys from Virmax.  I traveled with Alejandro Cadena of Virmax and started my visit with Steve Ford of Ritual Coffee Roasters and finished with Jeremy Tooker and Tal Mor from Four Barrel Coffee Roasters, both based in San Francisco, CA.

We started by going to La Plata, Huila and visiting the Occicafe growers association.  Virmax has a cupping station set up inside the association’s warehouse where members deliver coffee.  Virmax does a very strict quality control (physical and cup analysis) and only buys coffee that meets or exceeds the minimum physical requirements and displays a minimum set of cup characteristics.  Alexis Villamil is the Virmax analyst stationed at the Occicafe warehouse.   In addition to purchasing coffee, Alexis also visits the farmers and gives agricultural extension advice to the small coffee farmers that work with Virmax in the region.

Occicafe Growers Association in La Plata, Huila

With Alexis, we visited Finca Nueva Orquidea, the new farm of Cerbulo Yara.  Cerbulo has been delivering coffee to Virmax for a few years and has formed a relationship with Ritual Coffee Roasters.

Cerbulo Yara

Then we moved on to Pitalito in the southern part of the department.  Pitalito is the second largest city in Huila and it is where Virmax has a buying warehouse. Pitalito is surrounded by coffee farms, being right at the center of a U-shaped coffee region. Thank to its unique location, Pitalito is where many of the growers associations we work with in south Huila deliver their parchment. During this trip we also visited the farms of Remigio Quinayas and Omar Viveros, two more farmers with direct relationships with Ritual.

Slopes of Remigio Quinayas’ farm

From Pitalito we traveled north to the town of Gigante and the El Desarrollo growers association.  El Desarrollo produces the coffees under the Matambo brand.  During our visit we met with the leaders of the group in their facilities in town, where they also have a full cupping lab.

Edilfonso Yara at the El Desarrollo warehouse

That evening I went back to Pitalito and spent the next day at the Virmax warehouse with Luis Samboni, one of the Virmax quality analysts stationed in Pitalito, to watch and participate in the buying process from beginning to end.  Unfortunately I was there during the very first pickings and only a few lots were delivered.  But these lots were good enough to be purchased.

Click here for a photo set of the step by step process of the purchase of lot PIT-1405

The next day I met up with Alejandro and the guys from Four Barrel.  We went to visit the Andino Especial growers association in Bruselas, Huila, a municipality not very far from Pitalito.  We visited the farms of Helio Rico, former president of the association and his neighbor, David Burbano from whom Four Barrel had recently received a farmer lot that they were very happy with.

Helio Rico on his farm

David Burbano and his family

After spending the night in Pitalito, the next day we returned to the Andino warehouse for a day of cupping and buying… but unfortunately, the power was out in town and the generator wasn’t sufficient to power the operation.  We met with members of the Andino group who were gathering for an association meeting.

Andino Especial warehouse in Bruselas

With our new-found time and in the Colombian habit of fitting one more thing in the plan, we decided to visit San Agustin and the farm of Alejandro Ortega before speeding off to Neiva to catch our flight to Bogota.

Alejandro Ortega in his beneficio

The following day we flew from Bogota to Bucaramanga in Santander and then drove one hour to Hacienda El Roble.  This is a large, Organic, Rainforest Alliance, Bird Friendly, certified farm with which Virmax has begun to work with providing technical assistance to improve coffee quality.  We stayed at the hotel on the farm, ate wonderful meals, and toured the farm on horseback.

Horseback under the canopy

We toured the farm’s coffee varietal garden with 40+ different coffee varieties and we cupped some of the very early harvest lots with Katerinne Gutierrez, the Virmax analyst who is working this harvest on the farm to help with quality improvements.  We saw their roasting operation where they roast coffee from the farm for the domestic market.  Tal was able to give some advice on roasting, which was well received.  After that we headed out to the airport and back to Bogota.

Osvaldo Acevedo in the Hacienda El Roble varietal garden.

Observations and Analysis:

In Huila, coffee rust is still apparent and a concern for all coffee farmers.  Some farmers are doing a better job of controlling the fungus than others by applying systemic fungicides such as Alto-100 and regular applications of copper oxide.  Some farmers, whether for lack of funds or misinformation are choosing to ride it out.  With falling leaves and dying branches, these trees are being pruned and won’t produce for at least eighteen months.

Early indications are that the second semester harvest has better physical and cup quality than the first.  And while volumes will be better, we are not expecting a return to a “normal” Colombian output.  We are not expecting any significant volume out of Cauca.  In Huila and Tolima, this harvest will be short, it started late and constant rain in southern Colombia is not helping with harvesting or drying.  But improved quality is encouraging.

For the future, many farmers are following FNC lead by planting Castillo trees, with hopes for reduced disease and increased volume, but at the cost of cup score potential.  Lower yield, higher risk varieties, such as Caturra, Typica or Bourbon, require more attention but have the ability to produce better quality farmer lots.

Increased rains during the months of August & September caused a late flowering that combined with pruning and replanting are the ingredients for a later than usual first semester harvest in 2011. We will have to see the end of the 2nd semester harvest and how the weather progresses during the next few months to have a better idea of volumes for the 1st half of 2011.

In Santander, Hacienda El Roble is beautiful, well organized and has great potential.  First steps were a reorganization of the farm into different lots based on topography, micro climate and coffee variety.  Interns from coffee specific programs in technical schools were brought in to lead the picking.  Physical improvements were made in processing and drying.  And a Virmax quality control technician has been living at the farm overseeing quality improvements and conducting daily cuppings that help provide feedback on the ground.

Results are encouraging, picked coffee cherries have much better ripe consistency and the processing improvements are reducing defects.  It is still very early in the harvest in Santander, and since this is the first year of this new partnership, Virmax is establishing the baseline.  Preliminary cuppings are positive and we are anxious to see what we’ll have to offer from Hacienda El Roble during this crop.

Badi Bradley

It’s time to wrap up 2010 and say hello to 2011.  As we do this, we’ll take a moment to reflect on 2010… and to look forward to 2011.

Our first year has fortunately been a success.  From our launch at Tertulia 2010 at SCAA in Anaheim through the end of December, we’ve been able to accomplish what we set out to do: find efficiencies in the export/import process while establishing a transparent connection between growers and roasters, creating value for all those involved.  

However, we faced a number of challenges in 2010:

• Lower than expected coffee volume in the first and second semester harvests, due to a wild climate and to roya and broca infestations
• A rising and volatile C market
• The challenges of buying quality coffee in a rising market
• Increased value of the Colombian Peso to the US Dollar.

Despite these challenges, we’ve been able to establish new partnerships between North American buyers and Colombian and Ecuadorean growers.  A number of customers traveled with us during the year, visiting established relationships, or starting to develop new ones. And learning about the intricate process and commitment to quality of the Virmax buying model. We encourage all of you who couldn’t make it down to Colombia last year to travel down this year.  Don’t forget that the WBC this year will be held in Bogota from June 2-5!

Looking Forward…

We start 2011 with a bang! Our Finca San Luis Organic this past weekend was selected as one of the Good Food Awards Coffee Finalists!

I’m back in Colombia visiting some of our producers to see how the upcoming 1st Semester harvest is looking.  From what I’ve seen already in central Cauca, some growers will not be producing any coffee as they preferred to plant new trees or prune their existing ones to avoid having to deal with coffee leaf rust.  Others will be having a harvest, but they won’t have the usual volume as the flowering was not optimal due to heavy rains during the 2nd half of 2010. In east Cauca, Huila and Tolima the weather leading to the 1st semester harvest has been more favorable and therefore growers are expecting good volumes and an earlier start of the crop.

It’s too early to say how the 2nd semester harvest will be.  As I write these lines, growers in several regions are telling us that coffee trees have been flowering these days. So if weather permits it, the 2nd semester harvest will start earlier than usual.  But we’ll have to wait until May/June to see how volumes will look like then.

Most analysts predict prices to remain at current levels or above due to fundamental issues such as the predicted deficit in world coffee production vs demand and the increased influence of funds and other financial players in the market. This environment will pose great challenges both on the producer and the roaster sides. For us the challenge will lie mainly in the following three situations:  

• In order to entice growers to deliver their coffee to us and subject their lot to our rigorous quality control process, we must offer a quality bonus versus the market price sufficient for them to decide that it is worth their extra time and effort.
• Growers’ loyalty to the Relationship model and their long time customers will be tested as the temptation to sell to less demanding buyers at a better price than they achieved last year for their best product, sets in. Mediocrity could have its way in these conditions. 
• The rising market and increased volatility is creating a difficult and risky environment for us to write forward contracts well ahead of time. These contracts after all allow us to work with our grower partners to commit the necessary volumes and qualities.

Throughout the year we will work with our grower partners and with you in order to proactively find solutions that are beneficial to the whole chain. We will continue to monitor the market, growing conditions, harvest forecasts, etc… and keep you informed of how this situation is evolving. 

We’re looking forward to be able to catch up with all of you at:

• Coffee Fest in Chicago in February;
• The SCAA in Houston in April, and seeing as many of our customers as we can fit in the waking day
• The World Barista Championship in Bogota in June, where we will be hosting our Tertulia 2011.  We are planning a few origin excursions as well as plenty of cuppings and maybe a party or two.

In 2011 we are also studying the expansion of our coffee sourcing into other regions in Colombia, as well as other producing countries, with potential leads in Guatemala, Bolivia and Peru.  If this is something you are interested in or have an opinion about, please let us know.

And, of course, we are looking forward to a full year of importing and distribution with increased volumes but with the same attention to detail and dedicated customer service.

We aim to become your import / origin partner by working with you to help you reach your goals. We would love to hear from you:  Where can we improve in 2011? How can we expand our partnership with you? What would you like to see us do in 2011?

As always, we welcome your comments and suggestions and wish you a prosperous and healthy 2011.

Here’s a link to the Whole Foods NYC Cooking Blog with a Producer Profile: Gimme Coffee.  In this profile, Colleen Anunu from Gimme explains their relationship with Finca San Luis in Tolima and what it means to commit to a relationship in coffee.