Nescafé: Waking up the Philippine coffee industry

Nescafé is at the forefront of a campaign to revitalize the local coffee industry through grass roots initiatives designed to convince farmers to plant coffee.

According to Joel Lumagbas, head of Nestlé agricultural services department, these initiatives have done much to change the landscape for coffee farmers, creating much more favorable conditions for coffee farmers today than in decades past.

"Unlike before, coffee farmers now have direct access to Nescafé, assuring them that their coffee harvest will fetch the best possible price, whether it’s just one sack or a truckload," says Lumagbas.

Since the late ’90s, Nescafe has instituted a buying policy wherein coffee farmers are guaranteed sale of their crops at prices based on the prevailing market price and Nescafe’s coffee grading system. Buying stations located throughout the country have been set up to buy green coffee beans directly from the farmers, eliminating middlemen from the transaction and allowing farmers to earn more from their crops. Today, Nescafé is the single largest coffee buyer in the Philippines, guaranteeing that coffee farmers receive the full fruits of their labor.

From the ground up: Fueling an industry

But perhaps the largest challenge facing the coffee industry at the moment is how to convince farmers to take the first steps in planting coffee. Coffee plants need two years to mature before yielding their first harvest. But even this does not faze Lumagbas, who points out that thanks to the development of the Coffee Based Sustainable Farming System (CBSFS), in line with Sustainable Agriculture Initiative (SAIN) at Nestlé, farmers now have a means of planting cash crops in between coffee trees. The Nestlé Philippines Inc. Agricultural Services Department in Tagum City, Davao del Norte is one of a handful of locations where farmers can receive comprehensive training on CBSFS.

With the CBSFS, farmers are given step-by-step training on cash crops which can be planted along with coffee to supplement their income in the interim as well as provide additional revenues once the coffee plants mature. The CBSFS frees farmers from relying purely on coffee as a source of income and also gives them the freedom to keep coffee crops so that it can be sold at an optimum price.

Changing attitudes

To help farmers increase their yield and manage their crops, Nescafé established in 1994 the Nestlé Experimental and Demonstration Farm (NEDF) also located in Tagum City. The NEDF serves as a laboratory for new and improved farming methods, a provider of planting materials such as seedlings and cuttings, and a training ground for coffee farmers who wish to maximize their yield.

Through the NEDF, Lumagbas hopes coffee farmers will learn to change with times and become competitive on the world market once more. At one point, the Philippines ranked third, next only to Brazil and Columbia in terms of coffee production. But in order to reclaim our place as a coffee producer in the world commodities market, there is still much that has to be done.

To illustrate the need for initiatives and programs like the NEDF, he cites farmers in Lipa, the historical center of coffee growing in the Philippines, who are reluctant to part with old farming methods like single stem cultivation despite irrefutable data that show the quality of the coffee is in no way affected by the multi-stem method which can quadruple the yield of a plant. It explains why despite its long association with coffee, Batangas has since been overtaken by several provinces in Luzon in terms of coffee production.

In terms of quality, Lumagbas is quick to point out that soil and weather conditions through many parts of the Philippines are ideal for planting Robusta coffee beans which are generally acknowledged to be of world class quality.

Eventually, Lumagbas hopes even more farmers will come to realize that with proper farm management and improved farming techniques, there’s money to be made through planting coffee. He is optimistic that renewed interest in agriculture will attract a new generation of entrepreneurial farmers eager to capitalize on inroads made in coffee farming methods developed over the past decade.