One of the most frequently asked questions we have been asked this year is: “How will Covid-19 affect the coffee industry?” and more specifically “How will it affect producers?”
It wasn’t easy during the first few weeks to navigate the uncertainty, and it’s definitely no easier now, but we seem to have learned to live with it for the short term future and we are challenging ourselves as a company and as coffee professionals to decide how do we really want to participate in the coffee industry given the impacts of this pandemic.
Now more than ever it has become evident the coffee chain is a chain. Each individual link is super important to the strength of the whole, and the communication between the different parts of the coffee chain have become a new type of currency. Understanding the context of one another used to be a privilege called ‘transparency’, but today we must understand where we stand and where we would like to go very well in order to manage expectations and ensure positive results are still happening on both sides of the coffee chain. Without doing this there will be no sustainable business.
When the pandemic hit we felt like we were swimming in the middle of a stormy sea. It was hard to know what was ahead of us or when we would be able to stand on firm ground again. It was the middle of March when Project Origin, as a team, decided our values would be our compass to guide us during 2020 – Quality. Sustainability. Community. We set goals based on those values and ensured our behaviour matched those values.
Goal number one:
Project Origin will finish 2020 without a single employee losing their job. No matter what.
If there was financial difficulty it would be equally distributed across all staff, regardless of their position. Everyone was valued and everyone would be protected. This decision was made a week before the Australian Government announced the Jobkeeper salary support program.
Goal number two:
Project Origin will do anything possible to ensure our roaster partners can continue to roast coffee.
This was very tricky as it required a huge effort from roasters to develop 3 types of forecast for the year: What happens if business drops 30%, 50% or 70%? When this conversation was first held, few roasters couldn’t even imagine a scenario where their business would drop 70% and many mentioned that if that ever happened they would consider closing down. And in less than 1 week after those conversation, we were navigating the 70 to 90% drop in most areas of Australia.
During those weeks one thing in particular became very clear to us: if we get through this, we will get through it together. That’s where our Together We Thrive message began, and now it’s become a cornerstone of our relationships on all sides of the coffee chain.
Goal number 3 (the last and most complex of all):
Minimise the impact to coffee producers, especially those we have long-term relationships with.
We knew it was inevitable there would be an impact. We couldn’t just continue business as usual in the context of a global pandemic. But there were many things we could do to honour our existing commitments, contracts and agreements and ensure that producers didn’t bear the brunt of the losses.
The first decision we made was to prioritise existing, long-term relationships over new ones. This wasn’t easy, but it was what made the most sense to us as we have always worked to grow sustainable relationships, and that means it survives the good times and the bad times.
We worked hard with roasters to instil realistic expectations of quantities that could be shipped and prices when they arrived, considering our Australian dollar was swinging wildly during March-April – from a high of 0.67 cents to 1 US Dollar to a low of 0.55 cents in a matter of days!
And now, we want to share with you what happened.
The Project Origin Family grows bigger
Not only did we keep all our employees, but we hired a person in the Accounts department and another in Marketing and Design. After our end of financial year review we also decided to pay back to all staff members for any salary losses incurred during the month of April because of reduced hours.
The most important part of our business is its people and it was only thanks to the commitment and incredibly positive attitudes of the team that Project Origin managed to stay afloat and hold true to the values that drive us during 2020.
More coffee than ever with minimal disruption.
We managed to honour almost every single commitment to our coffee producers as we have originally discussed with them in November 2019, before their harvests began. Any shipment timings that changed were negotiated up front, and quantities that changed were discussed together with the producers and mutual agreements made. We are most proud of this in an environment where we heard lots of stories of companies abandoning contracts due to the circumstances.
All carbonic maceration (CM) lots were very successful and almost 90% were pre-sold before they even shipped out of origin. The premiums of these lots helping add extra value to producers which was a great benefit this year.
We managed to arrange all our purchases with a win-win scenario in mind with producers and guarantee the continuity of those relationships for 2021.
Minimise the impact to coffee producers… so how will Covid-19 affect origin countries?
This has been the hardest question to answer since this all started. The simplest answer is: as long as roasters continue to roast, demand for specialty coffee will continue to be there. That demand will ultimately support producers. The kinds of coffee roasters choose to buy and roasters will ultimately support the producers that create those coffees. If roasters prioritise specialty coffee, then specialty coffee producers will benefit.
Specialty coffee is not something that just happens. It’s a careful decision made by producers to invest their time and money into getting excellent results. All farms could produce commercial coffee and few have the potential to create specialty graded lots. But for producers to see the specialty coffee industry as offering sustainability of their incomes and livelihoods really depends on importers and roasters having an out loud commitment to specialty coffee, and offering stability to producers in their buying habits, and remembering that sustainable and long-term relationships must weather the bad times as well as benefit from the good times. If our relationships only survive the easy times then they are not truly sustainable… are they?