Difficult Conditions, Huge Potential: Processing Coffee in Eastern Uganda
When visiting Eastern Uganda, home of the famous Bugisu coffee, it’s advisable to set off from Kampala before dawn.
SHAKEEL PADAMSEY, DANA SIEDEM, and MICHAEL BUTEERA MUGISHA explore the challenges and opportunities of coffee production in Uganda.
The capital’s roads are known for being brutal and sitting in standstill traffic for hours in the tropical heat can hardly be considered fun. But if you leave early enough, you can cross the River Nile just as the sun is emerging over Lake Victoria. After another hour and a half’s drive, the foothills of Mount Elgon begin to emerge over the horizon. Initially a single looming mass of green, as you continue your approach the multitude of sheer cliffs and ridges start to become distinct. It’s impossible to see from the road, but this extinct volcano is covered by hundreds of thousands of tiny coffee gardens, scattered along the steep slopes and valleys all the way up to the forests of the national park, linked together by mud tracks that quickly turn to a thick sludge as soon as it starts to rain. This stunning but challenging mountain is where we decided to set up a micro washing station just a few years ago.
The Coffee Gardens Washing Station in Bukyabo (photo: Dana Siedem, The Coffee Gardens).
Ugandan coffee has huge potential but up until only recently was barely known in the specialty world. When my wife Dana and I (Shakeel) arrived in Uganda in 2016, our initial goal was simple: find some nice Ugandan coffee. We met dozens of producers and cooperatives, yet every seemingly interesting avenue turned into a dead-end, filled with disappointing, inconsistent, and defective samples. We couldn’t understand why no two batches of coffee, even apparently from the same farmer, tasted alike. Despite our frustration, we felt compelled to better understand why.
Why the Poor Quality?
There are lots of “myths” around why coffee quality in Uganda wasn’t meeting its full potential, but as we dug deeper into the question, many of them unraveled.
In discussion with various Ugandan coffee stakeholders - ranging from government officials to coffee processors to even many farmers themselves - the most common reason we were given for poor quality was the varied and often inefficient agricultural practices. In the East, farmers have tiny plots of land where coffee trees compete for space with a wide range of other crops. Even wealthier farmers rarely have large tracts of land and instead have many small gardens, often some distance from each other. Environmental degradation is rife, with annual mudslides a direct result of heavy deforestation. However, as we moved around, this explanation didn’t seem to be accurate: we saw many well-maintained gardens. To us it was clear that when farmers employed good agricultural practices, there was a real opportunity to produce high-quality coffee.
Another common complaint (or misconception) was that coffee processing methodologies in Uganda were poor and inconsistent. Unlike in neighboring Rwanda or Ethiopia, where nearly all fresh coffee cherries are taken to central processing stations, coffee is frequently processed in small volumes at farmers’ homes, using whatever equipment or methodology the farmer has or knows. Given the competing demands on their time, and the limited income the small volumes of coffee will bring, the argument was that most farmers do not process the coffee to a high standard but instead aim to sell as quickly as possible. This explanation also fell flat: the farmers we met clearly knew how to process coffee and we tasted some promising “home processed” coffees ourselves.
The real reasons are systemic and far more complex: despite the beautiful imagery of farmers working their gardens, coffee production in Uganda has a deeply ugly side, beset by a high degree of market distortion and an emphasis on extracting large volumes of coffee as cheaply as possible. Although red, ripe cherries are the basic starting point for producing specialty coffee, there is a huge market for underripe, overripe, and even diseased coffee. To turn a profit by artificially raising weight, “middlemen” [1] often sell processed coffee that has not been fully dried, or is mixed with sand and small stones. Further, some commercial traders mix cheaper, often defective coffees from the West and North with higher valued Eastern coffees, masquerading it all as the latter. This has affected the perception of Ugandan coffee, making it unattractive for producers to invest in creating something better, and disincentivizing farmers to improve their growing, harvesting, and processing practices. There’s just little reward for quality.
Yet within all of this, we saw so much potential. With our good friend (and now business partner) Michael Buteera Mugisha, months of late nights discussing the issues and exploring what could be done differently led us to the conclusion that we had to try something ourselves. The Coffee Gardens was born.
Annet Nafuna, TCG Staff, turning coffee in the dryer (photo: Dana Siedem, The Coffee Gardens).
The Way Forward
None of the three of us come from a commercial coffee or even a private sector background. Shakeel spent the last 11 years working for non-profits across sub-Saharan Africa, and was fascinated by how the private sector can be a force for good for smallholders. Michael, a trained economist and statistician, now has extensive experience in working with smallholder farmers in the Central region of Uganda, but at the time was only starting to explore how to raise the quality of robustas. When Dana shared her idea to set up The Coffee Gardens, we all jumped at the opportunity to try to produce some amazing coffees that properly rewarded and incentivized the farmers who grew them.
In 2018, after an exciting pilot with one farmer, we used our savings to build a small washing station in an area called Bukyabo, halfway up a mountain in Sironko District. Our plan was to process coffee in a similar way to the farmers from that area, introducing a high degree of consistency and quality assurance. When the results showed that we were producing the quality we wanted, our next step became trying to make it sustainable.
We are undoubtedly still early on our journey but there are a few things we believe have helped immensely up to this point. The first is the importance of building trust with farmers. In a context where they are rightly suspicious of all coffee traders, we worked hard to be transparent. Ordinarily, farmers rely on word-of-mouth to learn about coffee prices, and often find that the price they are actually offered is lower than expected due to ambiguous quality requirements. Farmers have told us that they believe such traders sell on the coffee at a higher price, pocketing the difference, but because coffee cherries deteriorate soon after picking, the cost of transporting coffee to a larger market is high, and that there are few local alternatives, they’ve had little choice but to accept the price offered - until now. We’ve invested in systems to build confidence, and we send text messages to all registered farmers with our buying prices and quality parameters as well as any other updates. Farmers who are unable to read, or have any questions, can call our hotline. These weren’t easy decisions; we were effectively sharing our pricing strategy in real time with all our competitors. In addition, although it’s extra work and cost, every farmer receives a receipt for every transaction, even if it’s 40c for 1 kg of coffee. We needed farmers to feel confident that they would not, and could not, be cheated. We made a decision at the beginning that if we couldn’t run this business the right way, then it wasn’t worth it.
Sam Kisolo, TCG Senior Field Officer, issue a receipt (photo: Panos Karakitsos).
Second, paying “high” prices to our farmers is important, but it’s not just about that. There is a big difference between earning more and earning enough. When nearly two thirds of our farmers earn less than US$100 a year from their coffee—their main single source of income—a 30% price increase is a start, but it doesn’t go very far. For some farmers, the higher payment for higher quality isn’t worth the additional effort as they have to visit their gardens multiple times, rather than being done with it once. It’s been important for us to work with experienced civil society partners to help us ensure that those with the least land get to the point where they can earn a “living” income, through tried and tested off-season programs to help farmers increase productivity and earn additional income, in an environmentally sustainable way. Although we’ve just started these programs, it’s already helped increase the number of smaller farmers who are working with us, and improve the overall quality of coffee we receive—much more noticeably than a price premium alone.
Third, in order to make this all work, it was crucial that we invest in robust, sophisticated, digital systems to register farmers, track each transaction, record inventory, and calculate outturns. At the end of each day, we can see how much coffee was received, which farmers have delivered and how much, and click through to an image of each receipt. We’ve seen that investing in tech isn’t about the size or age of the organization. Early on, we had a few relatively small incidents that gave us a big wake up call. If we didn’t have these systems, not only would we not have grown beyond 10 farmers, we probably would have made such losses that we would have given up. While we do end-of-season audits, we have clear indications in real time that our approach is working. During this past season, nearly a quarter of farmers chose to give us coffee on credit, receiving payment days or weeks later. This is only possible because of the trust we’ve built and the systems that underpin it.
Over the past three years, we’ve gone from working with one farmer to working with nearly 400 farming families. We’ve seen that by valuing, transparently paying, and training our partner farmers, they are motivated to not only supply us with great coffee cherries but also work alongside us. In order to meet our growing targets, every day during the harvest season, despite the non-stop rain, tons of coffee need to be brought down the mountain to our processing station within hours of picking. This is only possible because of our dedicated team of women and men who run down the steep mud paths with 50kg bags on their backs. Through this and other jobs at our station, we’ve been able to create employment opportunities for over 100 people from the farming community. Our successes so far stem from the community knowing that The Coffee Gardens is their project, too.
SHAKEEL PADAMSEY, DANA SIEDEM, and MICHAEL BUTEERA MUGISHA are the co-founders of The Coffee Gardens.
Endnotes
[1] “Middlemen”—brokers or “local buying agents”—is a term used here in Uganda to describe someone who meets various farmers, buys their coffee (either raw or processed), and sells it on, usually in a non-transparent way. Typically, middlemen trade in lower grades of coffee (which are then mixed with better coffees to bring up their price) or work on a commission basis for the large exporters operating here.