Last week we spoke about sustainable supply chains and how they can help to create a sustainable
coffee industry by empowering the farmer.
The Rwanda Trading Company (RTC) is a sister company of The Coffee Guy’s suppliers, Falcon Coffee.
RTC is a successful example of what it means to have an effective supply chain.
RTC was established in 2009 in Kigali, Rwanda. Its main intention was to create a positive social impact
by providing the means to achieve economic freedom and security for the small-holding farmers.
Before the arrival of the trade company in Rwanda, coffee farmers had no central organization that
could oversee the delivery of the crops to the mills nor the prices paid for the produce. Growers were
selling their beans to intermediaries.
Beans changed hands multiple times, sometimes crossing borders before processing. The expense of
simply moving and changing hands added costs without adding value and people outside of the coffee
industry were benefiting more than the farmers and millers.
RTC decided to focus on quality and production by offering farmers access to invaluable training in
financial literacy, agribusiness management and agronomy.
Before the Rwanda Trading Company, the system of intermediaries meant that the farmers were paid
the smallest percentage of the products real worth. And the profits and traceability were lost in
translation.
RTC removed the middle men by establishing cooperatives where the farmers could deliver their
produce directly. The cooperative would then send the beans to the mill and set up a link for export.
There are many benefits that came from minimizing intermediaries;
By reducing the costs of moving beans, this system has improved the accounting and
transparency along the chain. The farmers are now able to see that they get a fair price.
Risks are reduced by providing a stable link to buyers
Full transparency means data from sales gets back to RTC and is communicated to farmers. RTC
can then reward a second payment where profitability was high in line with market trends
The farmer’s income has become more predictable and more profitable and they are able to
plan and implement changes to meet with demand, using the data they receive
Clearer, more direct connection to consumers allows farmers to adapt to retailers’ preferences,
creating opportunity for specialization and scale planning
The RTC are also able pay farmers on time and at higher prices
Falcon Coffee Company links RTC to reliable buyers
Access to training and funding has greatly impacted the lives of the farmers;
Farmers are incentivized to produce high quality coffee to meet with the demands
Farmers are motivated to implement sustainable farming practices after their agronomy training
and witnessing the positive results
Farmers have access to credit and technology that can help to grow their business and create a
more stable future for their families.
The cooperatives have helped to establish a stronger farming community amongst the growers.
Enabling them to set up community savings and loan funds.
The farmers have begun to teach more sustainable farming methods
Involvement with RTC has seen a direct increase in yield and quality
In 2018, statistics showed that coffee yields were up by 211% and the average household
income had increased by 82%.
The collaborative work between farmers, RTC and Falcon coffee has created a ‘Sustainable Supply Chain’
in which everyone profits, costs are understood and controlled and the value of the product is realized.
When the social and economic structure of a system supports the worker and encourages a positive
environmental impact, we can increase the production potential of existing farm land without further
damage to the earth.
The Rwanda Trading Company follows a model that can be applied to other parts of the agricultural
industry. Investment in supply chains such as these could help to stabilize food security and reduce
farmer poverty in all commodities.
As a roaster, it is possible to play a part in a sustainable supply chain by choosing to buy beans through
companies such as these. This is one of the reasons that The Coffee Guy includes a RTC Rwandan bean in
its House Blend.
It is possible for the coffee industry to become sustainable if everyone works together to support
sustainable practices.