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Mexico Harvest Update

Hold on a Little Longer, Mexico Coffees are Coming

Sometimes coffee is a dance. Other times, it’s more like a rodeo. This year’s coffee season in Mexico was a bit of both – two steps forward with some cooperatives, one step back with other associations, and then a whole lot of holding on through to export.

This is a preview of Mexico’s 2021 harvest, with a focus on Oaxaca. It’s a top-level overview of what we’re bringing in, when to expect it, who we work with, how we work with them, and why we approach sourcing in this way. But, of course, coffee is more fun as a conversation – so contact your rep to learn more.

HARVEST OUTLOOK

Overview

The 2021 Mexico coffee season ran long, from January to July. On their way to port, coffees had to overcome quarantine and get through a bloody election on June 6th, the run-up to which saw 90 politicians murdered. Some of our friends in Oaxaca spent most of the harvest in the hospital, while others in Guerrero had to flee their farms as new gangs moved to the mountain.

On the other hand, quarantine meant fewer buyers in more remote places, which prompted many farmers to drink their own coffee; the past two years have seen the start of many rural cafes and roasteries. Interest in specialty is at an all-time high. At the same time, stronger markets and qualities continue to drive up farm-gate prices. And in response to recent stresses, indigenous farmer organizations are getting even more political.

Changes & Industry Challenges

In the 90s smallholder coffee from Mexico came through cooperatives. Then came coffee rust, where farmers lost more than their crops. They lost their customers, their contracts, and the business that bound them together as a group.

Most cooperatives in Oaxaca today are shells of the organizations they once were. Without cash they can’t buy. Without a reason to meet, they don’t meet. Others have pared operations down to a single warehouse. Others exist in name only. In their place grew informal networks to connect farmers to local markets and local markets to the export market in Oaxaca City.

It is through these networks, now, that coffee gets to Oaxaca City where one can find the mills, cupping labs, cuppers, warehouses, and financing needed to separate specialty for export. But these are farmers who live hours away from the closest local market – and for this, only deliver their coffee once a year.

It’s expensive to bring coffee down mountain. Even more expensive is trucking it Oaxaca for storage at a third-party warehouse and having it cupped. It’s nearly impossible for an average farmer to know what is specialty, and what that’s worth. It can take months to turn parchment into payment. This is where middle-men or coyotes come in. They take advantage of farmers by obscuring their sources and prices. They can also withhold full payments or information.

Specialty is on the rise throughout rural Mexico and farmers are more and more aware they can get premiums for selective picking. Also on the rise, however, is the term ‘Coyote-Q’, referring to Q-cuppers who use their knowledge to buy low at the farm and sell high in Oaxaca.

In this context, trust is difficult. Neighbors are watching one another to see what prices they can get. It becomes more of a competition than a cooperative.

In general, the chief challenge to sourcing specialty in Mexico is aggregation and in especially in Oaxaca. This is the process by which coffees get bulked at the bodega level or for transport to Oaxaca City. It’s a process that requires lots of trust, coordination, communication, and planning within a community and throughout the network that connects them to export.

And when it comes to how we work together, to building capacity, and building trust, we get to an area where Crop to Cup can truly contribute.

Our Approach

The easiest way to find quality is to cup across lots in warehouse in Oaxaca. This means buying from the network, agent, or more often the coyote who brought the coffee there.

Instead, we look for ways to aggregate at the community level. In some areas, this is through an agent whose house turns into a makeshift bodega during the harvest season.

Households like those of Guzman Feria in La Cañada, Joaquin Santana in Sierra Sur, and Jose Vasquez in Sierra Mixteca have inherited the trust of families further up the mountain. Many of these families do not speak Spanish and most of them only deliver coffee once per year.

Where we can, we look to work through existing cooperatives even if they are not active or no longer active in coffee. This is especially important in the region of La Cañada where cooperatives play a larger role in the community, but not through coffee as of yet.

In all cases, we look to build coalitions between communities, collectors, and cuppers. We work with Root Capital and other local banks to provide financing. We move between export mills like UNTAO and Galguera Gomez in Oaxaca based on what’s best for warehousing, milling, and export services. Prices are always transparent, as are the costs between farm and export. Farmers must sign off on these numbers while delivering their coffee, and again when receiving a second payment after export.

The ideal next step is to start a radio program that broadcasts coffee information in indigenous languages. In every form, the idea is to push information to farming families so that they can help in verification.

Timing

Harvests generally move from the south and east to the north, meaning that Chiapas and Veracruz can start collections a full month before farms in Sierra Sur, Oaxaca, and two months from higher altitudes in La Cañada Oaxaca. Overall, however, we start to see quality samples come in starting in March and continuing through June.

Exports have historically ranged from June – August. This is a little late and a little longer of a period than we’d like, but every year there seems to be a new and valid reason for delay. This year, for example, a few exports were about a month late due to the difficulty of operating during Covid-19 and because of tense elections in June.

Peak Harvest Lot Planning Shipments / Arrivals
March – May

June – August

July – Septemeber

We travel to Mexico before the harvest between October – November and again in early harvest between March-April. We rely on our in-country staff to execute on the plan set at each of our visits.

Producing Partner Highlights

Our dedicated facilitator in Oaxaca is Ramon Ruiz. He comes with decades of experience and relationships built on trust throughout specific stretches of Sierra Sur, Sierra Mixteca, and La Cañada. This year, in addition to achieving financing, Ramon is going to receive the assistance of a younger cupping team to speed up the lot separation process. This will also speed up the feedback loop with farmers. One of these cuppers will be dedicated to the lot separation; the other will focus on farmer feedback.

The three main supply chains that Ramon manages for us include:

Jose Vasquez – Huerta del Rio, Sierra Mixteca. Jose fell ill this year, and so missed most of the harvest. Without his leadership collection standards slipped. They had decent coffee and they’ve worked hard to build their brand. We decided to wait a year to bring up qualities.

Joaquin Santana – Lachao, Sierra Sur

Of our partners, Joaquin is the most proactive. Once the head of the now defunct UNECAFE cooperative, Joaquin now collects coffee in his house, which serves as both the bodega and meeting center for this now informal association of farmers. He also travels 4-8 hours at a stretch to visit some of the further out farmers, and an equal distance to Oaxaca as he follows their coffee through to export.

Guzman Feria – Sochiapam, La Cañada.

Sr. Feria had another excellent year, scaling up quality collections way up from last year’s 40 bags. He has proven to distribute premiums throughout his network, which has voted to reinvest a portion towards drying beds and shade nets.

In addition, we work with the cupping and logistics team at Ensembles de Cafe to support relationships with cooperatives:

Red 5 de Diciembre – Eloxochitlán de Flores Magón, La Cañada.

An agricultural extension arm of the Oaxaca-based CORO Cooperative, Red 5 de Diciembre is a group of 7 agronomists who provide services to communities who agree to share storage. One region they serve is deep in the mountains of La Cañada, centered around a town called Eloxochitlán de Flores Magón.

This is a beautiful area and a tight-knit community. They are far off the highway and rely on the Red 5 network to access information, transportation, and storage in Oaxaca. The challenge here is not engagement or access, but to separate micro lots for higher premiums, as opposed to blending premiums across container-sized lots, in a culture based more on equality than equity.

CAFECO – La Concordia, Chiapas

Outside of Oaxaca- especially in Chiapas- we find formidable cooperatives who effectively purchase and market coffees on their members’ behalf. The challenges here are similar; container-loads are easy, but anything like a micro-lot runs into a few challenges. The first being that of ethos, as mentioned above, many cooperatives are incentivized to provide equal payment to all members over more performance-based systems of payment. Next, these groups don’t have the cupping capacity, or space, to separate lots. And lastly, customers are few and far between – most roasters go a few kilometers south to Guatemala for these qualities.

LOOKING FORWARD

These coffees were booked when NY was between 130 – 150c. We practice flat-pricing, meaning that these coffees are at least 25c below their replacement costs. For this, and their qualities, we expect them to move quickly. If you are interested contact your trader about samples and consider putting in a SAS-NANS contract (subject to arrival sample, no approval, no sale) to ensure first right of refusal.

2021 MEXICO OFFERS

– The Crop to Cup Sourcing Team