34 • Honduras • C&CI May 2012
Twin Trading reports on Honduran coffee market
to good volume. Over the past few years, however, this perception has begun to shift. The privatisation of the Honduran Coffee Institute (IHCAFE) in 2003 appears to have been an important point in the development of an effort to transform the volume of pro- duction and improve the quality. This is particularly marked in western
H
Honduras, where a number of dynamic co- operatives have benefited from certified cof- fee premiums (particularly Fairtrade and organic) and greater interest in specialty coffees (mainly from the US market). This has enabled them to invest in improving quality, from farm management through to milling. More recently, higher prices on the New York market have encouraged greater interest in coffee, leading to increased pro- duction and quality initiatives.
Investing in quality
The investment that co-ops have made in quality is, however, varied, with some mak- ing more substantial improvements than others. It is noticeable that co-ops with younger, more dynamic managers are lead- ing the way. Proximity to the Guatemalan border has
meant that, historically a lot of coffee disap- peared over the border, due to the higher local market price in the neighbouring coun- try (an estimated 10 per cent). However, it is suggested, the flow of coffee over the bor- der has reduced recently, which may be related to the lack of margin to exploit between the price of coffee in Guatemala and Honduras. Farm sizes average around six hectares,
with yields reported at 1,600kg per hectare (ha) for organic coffee and reaching around 2,000-2,500/ha for conventional. One of the main reasons for the higher yields appears to be tree density, with 4,000 trees per hectare common. One of the most important effects of
higher prices is that there has been a huge amount of new planting. Moreover, this is
Coffee grown by the Honduran co-ops enjoys multiple certifications and much of it is organic
actively encouraged by IHCAFE. This means that many anticipate Honduran pro- duction will increase by about 50 per cent, to 6 million bags, by 2014. While impressive, the focus on produc-
tion over processing has raised concerns about bottlenecks, particularly at the drying stage. This was clear from this year’s har- vest, as coffee cherries matured during a comparatively short period. In some areas, mills were reportedly open for buying only half the week. (Subsequent to my trip, this bottleneck was reported to be easing). The main varieties are: catuai (including yellow catuai) and, more recently, catimor, along with paca, pacamara and sarchimor.
Flexible approach
The co-operatives in Honduras are of a decent scale and seem to approach the market flexibly in relation to certification. As Fairtrade gives the greatest premiums there is an obvious preference for this. Nevertheless, this is tempered by a pragma-
tism that not all coffee can be sold as such, and so combinations of some or all of Fairtrade, Rainforest Alliance, UTZ and CAFE Practices are the norm (see below). The way coffee is processed has similari-
ties to Guatemala and Costa Rica, including extensive use of vertical pre-dryers and cylindrical dryers (guardiolas) instead of dry- ing fully on patios. Farmers either deliver to the co-op in cherry or wet parchment (moja- do). Drying patios are used to get the mois- ture content down, initially to around 48 per cent (oreado) before using mechanical dry- ers to get to 12 per cent. Most co-opera- tives will have wet milling facilities. Among the co-operatives I visited was
Beneficio Santa Rosa (BSR) and a number of affiliated co-operatives. BSR is a private- ly-owned mill that started in 2004. It is majority-owned by an American ex-pat and has six other shareholders, including farm- ers, though by no means small (one with around 140 hectares). It has a very dynamic manager, Douglas Urquia, who has focused very strongly on the specialty market, with
istorically, Honduras has been viewed as a low quality washed Arabica origin, producing moderate
Matt Horsbrugh, Head of Trading at Twin Trading in the UK recently visited Honduras, and offers his insights here on
developments in the country over the last 10 years and looks at the current output of a number of certified coffee co-operatives
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