Coffee Coops in Rwanda

-Project status: Active
-Sectors: For-profit Activity
-Funding source: Government Funded
-Location of project: Rwanda | Sub-Saharan Africa
-Project type: Consumer Products Activity | Business Development Activity | Agriculture Activity

Managing Organization: The Maraba Coffee Coop

Activity Description:

Rwanda, a tiny East African country recently rent by a famously savage civil war, has found hope in that most colonial of crops: coffee. By riding booming demand in the developed world for specialty brews — and, to a certain extent, by turning its own challenges to its advantage — Rwanda has made premium coffee-growing a national priority. That has not only brought in a trickle of money to a country with little else to trade, but provided a stage on which one-time blood enemies can reconcile their terrible history.

“By improving the quality of their coffee, about 40,000 of Rwanda’s 500,000 coffee farmers have at least doubled their incomes,” said Kevin J. Mullally, who runs the office of the United States Agency for International Development, or A.I.D., in Kigali, the Rwandan capital. “Coffee has played a crucial role in the positive changes in Rwanda.”

Since 2001, A.I.D. has invested $10 million in helping Rwandans improve the quality of their coffee, mainly by providing farmers’ cooperatives and small entrepreneurs with financing for washing stations and training in their use. The Rwanda government’s goal is to make all coffee produced in the country specialty coffee by 2008.

At the washing stations, or wet mills, farmers clean, sort, pulp and dry coffee cherries — the bright red berrylike fruit produced by coffee trees. Then the beans, or seeds, that they contain can be sold to the lucrative specialty market, where demand and prices remain relatively high even when conventional coffee prices dip.

The big canned coffee companies currently pay about $1 a pound for C-grade coffee beans, while the higher-grade specialty coffees preferred by Starbucks, Green Mountain and other chains generally fetch about $1.50 a pound or more. In Rwanda, premium roasters will pay as much as $3.50 a pound for the best beans.

When these prices are paid to cooperatives, instead of to private dealers, the profits go directly to farmers, 20 percent of whom are widows and orphans because of the genocide. In the United States, gourmet coffee has generally accounted for 15 percent of the market, but 40 percent of the revenue (currently $11 billion, up from $7.6 billion in 2000), so roasters are eager to develop relationships with cooperatives that can deliver consistently high-quality coffee.

Rwanda is still a desperately poor country, with a per-capita economic output of only $1,500. Sixty percent of Rwandans live below the poverty line, and even though 90 percent are engaged in subsistence agriculture, food production hasn’t kept pace with the population growth. Rwanda is a landlocked country that is the most densely populated in Africa — 8.6 million people live in an area slightly smaller than Maryland. The country has few natural resources.

Until the 1990’s, coffee accounted for 60 percent of total exports, but that declined to about 20 percent in 2001 because of the economic devastation of the genocide and a worldwide crash in coffee prices. Since then, the government has focused on increasing the volume and quality of coffee exports as it tries to revive the economy; coffee now accounts for 30 percent of exports, totaling $35 million, which is expected to double this year, Mr. Mullally said.

Gemima Mukashyaka, an orphan of Rwanda’s 1994 genocide, who has returned to her parents former coffee farm and, with the help of USAID and a local cooperative, has become part of a thriving coffee trade, which produces premium quality beans for export to the United States.

Ms. Mukashyaka, whose parents were murdered during the genocide, now works side by side at a coffee cooperative with women, whose husbands are in prison for taking part in the killings. Many hope that the communal work experience will alleviate the ethnic suspicions and hatreds, and sow the seeds of a sweeter fruit. So far, so good. Gemma Uwera, a mother of eight, whose husband is accused of taking part in the genocide, told the Times that, “After the genocide, I feared other people’s reaction when they got to know that my husband is in jail, so it was not easy to join the co-op. Now I have friends, I meet regularly with widows of genocide, and we plan how we can help each other if someone has a problem.”

And in addition to providing a social outlet for farmers still traumatized by the ravages of war, coffee cultivation has been the engine of economic growth in the region. “Five years ago, when worldwide coffee prices spiraled downward, her [Mukashyaka] neighbors in the densely populated region near Butare were uprooting their coffee trees and planting quick-growing food crops to survive,” The Times Reports. “But today, there’s a clean coffee processing station nearby, and sprouted around it are two restaurants, a pharmacy, a bank, six hair salons, and just last week, the village’s first Internet cafe.”

For the time being, coffee has been a boon for Rwanda, a landlocked nation with few natural resources and little economic activity. But there is some concern that Rwanda’s recent success with coffee is only temporary. Read more background on Rwanda's coffee industry here.


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