Stephen's Brazil Trip

First, some facts and figures…

• Brazil anticipated crop 2012 harvest 50 million + bags.
• Brazil anticipated internal consumption 17m bags.
• Brazil Conilon (robusta) crop 17m bags from the above total 50m.
• Brazil produces twice the total coffee of the next biggest producer Vietnam (which is purely robusta) and four times Colombia’s arabica production.
• Brazil will out consume the USA for coffee within the next 3 years.

First stop was Pocos de Caldas – a personal favourite of mine not least because I have my own small farm there. In fact, parts of Minas Gerais were hit by a frost last year and more than 50% of my small coffee production (visit Has Bean - Fazenda Inglaterra – it’s good!!!) was lost to frost. So this harvest in May / June will be much smaller than it should have been.

This is a bitter irony, since the commodity market price for coffee has collapsed from highs of over $3/lb to the current level of some $1.80/lb – a fall of more than 35%. The reason, or part of the reason, is the coming Brazil harvest, which looks to be huge (more about this later). So, let’s imagine things had there NOT been a small frost in parts of Minas Gerais…..

I also visited Fazenda Passeio where Adolfo Vieira is doing fantastic work. What a lovely place, so well managed. Adolfo has a wonderful programme of ornamental tree planting for visitors to the farm. Adolfo is very clever here, saying that the first watering and fertiliser comes with the planting, but thereafter your tree only gets water and fertiliser if you buy coffee from Fazenda Passeio!! Let’s come back in five years and see how this small ornamental forest looks!!

I also stayed at Fazenda Irarema, whose 100% Bourbon coffee we will shortly have in stock in the UK. My great friend Raymond Rebetez is a wonderful host. Irarema is a beautiful farm located not far from the famous farms of Cachoeira da Grama, Rainha, Recreio, Santa Ines – all known from the Cup of Excellence and a long history of exportation of fine coffees. Raymond also owns nearby (virtually adjacent) Fazenda Breijoes whose coffee is about to unload in Seattle for our North American customers.

No trip to Brazil is complete without stopping to see Jose Francisco, Corina and Chico from Fazenda Monte Alegre. This exceptional farm is a brand of coffee in its own right – like Ipanema or Da Terra. Exportable production of about 80,000 bags / year, which I believe to be more than the entire country of Bolivia exports!

It is astonishing to learn that the production cost (including financing) is now so high in Brazil - even on an exceptionally well managed farm such as Monte Alegre - that it is likely that in future only family farms and mechanised harvesting for coffee will remain in South Minas, or any part of Brazil for that matter.

Brazil is contending with a very strong currency, making exports relatively uncompetitive; high costs of borrowing; relatively high labour costs; and urbanisation of the population, leaving labour scarce in the coffee growing areas. The future landscape of South Minas will potentially be very different from now. Monte Alegre itself could become perhaps about 50% mechanised, but other traditional South Minas coffee farms in hilly, mountainous areas do not have this option. Large scale, private and agro business coffee farms in non mechanised parts of Brazil may increasingly become a thing of the past.

From Monte Alegre it was a long trip to Belo Horizonte where we met with Ismael Andrade and later travelled 6 hours from Belo to his farms in the Cerrado region of Minas Gerais state – near the town of Carmo de Paranaiba (this is not the same Carmo made famous made famous by Cup of Excellence, which is much further south in Minas)

We stock Ismael’s Sao Silvestre and Capim Branco coffees and unlike further south in Minas Gerais the Cerrado region is an alto plano (flat plain) rather like a savannah whose topography and climate are ideal for coffee production and mechanised harvesting.

I also saw the unusual phenomenon of coffees trees branches broken and falling down under the weight of beans on the trees. This, in a nutshell, may be the best image to understand why the commodity market has fallen so precipitously from its recent highs.

All in all, it was a very interesting trip – as well as the farm visits I also cupped with two of our best export partners, in the meantime tasting an 85-90 scoring coffee from Espirito Santo, which was a very pleasant surprise and certainly something to keep an eye on for the future.

Coffeehunter has always been about unearthing fine coffees, sometimes in much lesser known origins or areas. We continue with this mission, redefined to take into account today’s massive information and social networking role in the distribution of information.

The beauty and intrigue of the specialty coffee business is that there is still so much unknown, unexplored, and misunderstood in our field.

I have often said coffee is the best known least known product being consumed, and this recent trip to Brazil underlined that fact.

Brazil surpassed the UK as the world’s 6th biggest economy in 2011. For those thinking that Brazil is some third world backwater, think again. This country is prosperous with minerals, oil, vast agricultural reserves, fertile land, virgin forests. The world’s biggest producer not only of coffee, but soybeans. Soon to be the world’s biggest CONSUMER of coffee also. Brazil has an advanced aircraft industry (Embraer), growing prosperous consumer class buying apartments clothes, and consumer goods in Europe and the USA at a fraction of the cost locally in Brazil.

You will struggle to find a better welcome than in Brazil and it was great to catch up with so many old friends, some of whom we have now been working with for more than a decade.

I foresee some big changes in Brazil in future, but I believe the country will continue to be a big producer (and also huge consumer) of coffee, even if perhaps the current typical growing regions change in future.

Stay tuned…

SLH 12th March

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