I originally visited Sumatra for the first time in Aug 2004, just 4 months before the devastating tsunami hit Aceh. Although the upland coffee areas were not at all affected directly by this disaster, the country as a whole suffered considerably. Strangely enough, the tsunami may have jump started the peace negotiations to end the lengthy war in Aceh which has been seeking to establish an independent state in that province at the far north of the island. In 2004, Aceh had been closed to visits from foreign travellers but now our group was able to travel to the province which is now accessible to visitors.
Perhaps it would be useful to re-visit some facts about Indonesia, partly to dispel lasting folklore and misinformation which is prevalent in some parts of the commodity and specialty coffee industries.
Let’s not forget a few facts. First of all, Indonesia is a huge coffee producer – the 4th biggest in the world. Indonesia export some 7 million 60kg bags annually. Yet less than 10% is Arabica coffee. It’s quite ironic that Brazil suffers a ‘quality drag’ (particularly in the North American market) by being a producer of vast quantities of commodity grade coffee. Yet Indonesia does not appear to suffer the same fate. Specialty buyers are enthusiastic supporters of the best Indonesian Arabica coffees – Starbucks alone may account for more than half the Indonesian Arabica crop! There is no doubt that the best examples of Sumatra and Sulawesi coffees are exceptional and unique while the worst are common, earthy, uneven and inconsistent. In this sense, Indonesia is like Ethiopia in that we see considerable differences in quality for coffees ostensibly named the same (Yirgacheffe, Harrar, Mandheling, Lintong, Limu, Sulawesi, etc.). All of these coffees can display possibly the best and worst characters under the same label.
As a roaster, your green bean supplier in each of these categories is now more important than ever. And the cupping table (as always) is the only home for the real quality truth.
Some markets have become completely accustomed to an old, aged, musty character for Sumatran and Sulawesi coffees. Yet the best fresh examples from these regions can usually reflect fresh, very full-bodied sweetness and richness in the cup. Some ‘expert’ roasters reject the best Sumatran and Sulawesi coffees when they are fresh, not recognising the profile of fine freshly arrived coffee when compared with the more usual aged and slow moving stocks held by some importers.
Mercanta’s business is in finding the finest examples in those areas of the globe that produce – or have the potential to produce – a premium specialty coffee. So although we buy some small quantities of excellent Robusta from Indonesia, this report will focus on two of the four principal areas of fine specialty grade Arabica production in Indonesia namely:
- The island of Sumatra where coffee grows in two very distinct regions (historically called Lintong and Mandheling)
- Northern Sumatra around Lake Toba and Sidikalang where one village called Lintong has adopted the name for the entire area
- Aceh around Takengon where, bizarrely, the coffee is called Mandheling for reasons few can recall or accurately explain
Mercanta has tried to adopt a far more accurate denomination of these coffees and we will hope to even better define them in future. Somehow, neither ‘Lintong’ nor ‘Mandheling’ is anything close to an accurate name for these fine coffees any more than ‘Santos’ is a name for fine estate Brazils. We believe that the specialty coffee industry should adopt much more accurate provenance and Mercanta will be labelling the coffees in a manner more reflective of the origin rather than historical anomalies.
Fine coffee is also produced on the island of Sulawesi – perhaps a destination for a future trip but not visited on this occasion.
The neighbouring island of Java – now almost synonymous with coffee – produces some excellent specialty coffee also. Here, fine coffee is also produced on large government-owned estates.
Arabica coffee is grown principally on 5 estates – Blawan (alt. Belawan, Blauan), Jampit (alt. Djampit), Pancoer (alt. Pancur), Kayumas and Tugosari at around 4,800ft on the Ijen Plateau. The estates were established more than 100 years ago under the Dutch colonialists. Robusta coffee is grown in a similar fashion at 14 estates throughout East Java: Satak, Bangelan, Sumber Jeru, Gunung Gambir, Zeelandia, Rayap, Mumbal, Kalisanen, Silosanen, Gunung Gumitir, Tanah Manis, Malangsari, Kendeng Lembu, Sumber Jambe and Kaliselogiri.
Our group covered over 1,200km spending 44 hours in a tourist coach travelling inland to the coffee areas around Lake Toba and then to the Aceh region, previously off-limits to visitors.
We had first met with our milling partners in Sumatra – PT Sarimakmur – in 2004. And only 3 years later, I saw how this private mill had come on in leaps and bounds. As an importer of fine coffee from Indonesia, our choice of milling partner is absolutely crucial. Once the system of harvesting, pulping, collections, and milling is understood, you will know why. Unlike many of our origin partners in producing countries, Sarimakmur is a huge company – perhaps accounting for as much as 10% of all raw coffee exports from Indonesia. Sarimakmur has milling facilities in Medan (where we visited), Surabaya (Robusta), Lampung (Robusta) and collection facilities in Takengon Aceh, Sidikalang (both also part of our itinerary) and in Makkasar on the neighbouring island of Sulawesi.
Notwithstanding the enormous size of Sarimakmur, our negotiations with them have always been of the most professional peer-to-peer character. I almost cannot explain the fantastic commitment from them to take our group of (high quality / low volume) customers all over the island for a week while the next visitors may buy more coffee in a single shipment than we will purchase all year. Our business with Sarimakmur has grown nicely from a standing start three years ago and I will not be able to fully covey in these pages the hospitality and commitment of Sarimakmur to treat our group to an excellent, thorough, and most informative tour.
Outside of the Java government-owned estates, almost every single coffee grower in Indonesia is small – at around 2 hectares on average, perhaps even less. Some growers include coffee as a part of a vegetable, wheat and corn-growing plot while other larger 2-3 hectare farms may be devoted more or less entirely to coffee production.
The growers hand-pulp or (rarely) machine-pulp the coffee at their farm and deliver it very wet (say, 80% humidity) to a collection station nearby. Here, this wet parchment is bought and then dried on patios before milling. However, unlike all other coffee-producing countries, Indonesia has developed hulling machinery to mill even 18% wet parchment – a very likely cause of the unique blue / green colour familiar to the finest prepared lots and also the huge quality variance between best and worst as some coffee will surely be fermented if this process is too slow. Large mills buy from the collectors in the countryside (many collectors are allied to some trusted buyers but, in any case, they are free to sell their coffee where they choose and to the highest and most reliable payers). The export preparation at the large export mills is a key step in this otherwise tricky process. And on the basis of our visits, Sarimakmur’s Medan facility would take some beating.
As in 2004, we found conditions at the Sarimakmur Medan facility in good order. If further evidence were needed, a number of socially-conscious multinational coffee house chains and roasters have audited the Sarimakmur facility and found everything to meet their satisfaction.
Electronics sorters and over a thousand hand-pickers provide an amazing sight and coffee can be sorted to whatever price and quality level the buyer defines. Three years ago, Mercanta simply said that we are prepared to pay premium prices for the very finest selections by cup and preparation and this has served us well. We do not need to buy hundreds of containers (yet!!) from Sumatra so we comb through the lots with a careful consideration and select really the very best ones.
Sarimakmur provides employment for 1,400 workers in the Medan facility alone, surely making the mill an important local employer in this city of 3 million inhabitants. Our own enquiries (besides free access to look around as we wished) showed that the sorters were paid US$3.50/day equivalent (interestingly, this was $2/day when we visited in 2004) and it is above the government-set minimum wage.
Most specialty buyers realize that we cannot apply Western European or North American values to these numbers – one of our hosts told us that only 57% of Indonesia’s 222 million population (2006 census) has electrical power supply at home. Yet traveling around this vast island, the country does not appear impoverished at all and overall the soil is super fertile, is not prone to frost and the rainfall appears to be as abundant as the sunlight. Of course, a huge natural disaster devastated costal parts of Aceh just 3 years ago but in the highlands where coffee grows there was no obvious sign of this disaster.
Most growers receive around 13,000-15,000 Indonesian Rupees per kg (about 65 US cents per pound) for their very wet parchment. But considering the weight loss and the fact that these beans are completely unsorted (perhaps 20% will be lost in the milling cycle) this is a very fair price. A typical farmer may make US$1,500/year from coffee, supplementing his income with home grown fruits, vegetables and cereals and perhaps also poultry and cattle. Many small farms are not really ‘managed’ in an agricultural sense – no artificial fertilizers or pesticides are used and there is very little pruning or husbandry.
Nature’s bounty is evident in Sarimakmur’s mill in the form of lemongrass, nutmeg, cinnamon bark, cocoa beans, and other produce and it’s easy to see why early explorers, traders and settlers were attracted to the region.
Sarimakmur mentioned some future developments to us in 2004, and on this visit we were able to see a revolutionary new estate (the only one outside of the Java government estates) near Sidikalang. This estate (previously growing corn) is called Wahana Grana Makmur (meaning Prosperity and Good Fortune, if I remember rightly). Here, Sarimakmur will develop a 500 hectare estate for organic vegetables and coffee. A fascinating development was that a very rare Costa Rican Arabica coffee varietal, Villa Sarchí, was being planted as well as typica from Colombia, Jember from Java, Aceh longberry, Tim Tim (a local catimor strain), caturra and catuaí (also from Costa Rica). A well-known coffee brand had been advising on the plantings and Mercanta also chipped in with our recommendation to plant also a Brazil or El Salvador bourbon. Production may come on stream in 2010 and a guest house and facilities are also planned.
As part of the week-long trip, we had also arranged to visit the Gayo Mountain Co-op (not to be confused with the multinational mill brand of the same name). Danny and Rob were our hosts and explained this producer / co-op idea supported in part by their own hard work and inputs from USAID, UNDP and other NGOs. A dormant Dutch-built mill was recovered and dry-milling facilities re-instated. A wet-milling facility (for receipt of cherry) will also be developed. Gayo Mountain Co-op has about 2,000 members including some in remote and isolated areas badly affected by the fighting in past years. Some 30 villages are incorporated and 3 will be selected for a pilot project in the near future which will install stainless steel fermentation tanks. This co-op export under the name of ‘Aceh Coffee’ and comes under the umbrella of Indonesia Specialty Coffee Community Development. First export operations took place in March 07 and Mercanta has already seen some samples from Aceh Coffee. It is our experience in other specialty coffee producing countries that cooperation amongst (perhaps competing) suppliers will often yield multiplier results for the cooperating parties (witness Brazil and Guatemala where this system operates very effectively…and the Dominican Republic – where it does not!). Rob and Danny provided us a very informative and complete afternoon and we also enjoyed a nice meal with them at the mill at the end of the day. We will evaluate some new samples from Gayo Mountain Co-op in the coming months.
Like Colombia and Kenya, the northern coffee growing region of Sumatra (most commonly known as ‘Lingtong’) has two crops in May/June and Sept/Oct. The crops in Aceh (more commonly known as ‘Mandheling’) are more typically harvested around a month later.
A visit like ours around Sumatra – from teeming traffic chaos in Medan to endless fertile upland countryside (coffee is growing around 1000-1300m; higher in some cases) – will give the visitor a perspective of the potential of this huge country covering many thousands of islands. Three years ago, NGO’s and audit agencies were thin on the ground but now the area is crawling with Utz Kapeh, Fairtrade, Skal Organic, 4C, Cafe Practices, Rainforest Alliance – you name it. A veritable blizzard of certification agencies has descended on Sumatra as the place seems to have been ”discovered” in the past few years as doubtless vast quantities of aid (and aid agency staff) poured in after the tsunami.
At Mercanta, our methodology is simple – and perhaps it will not satisfy the ‘badge and label’ buyers who need to justify themselves to large retailers and their customers. But it will satisfy our Speciality Coffee roaster customers in 25 countries who rely on us to discover very fine quality (85+ points) Sumatra coffee.
And, hey – since it does matter – yes, we pay a lot more than certification baseline prices in order to ensure our pick of the crop.
Genuine specialty buyers are more aware than ever that premium prices are commonplace to secure the best of crop (witness Cup of Excellence average prices now at above USD$6/lb for testimony to that fact). We will continue to see the ‘badge and label’ and the ‘quality’ businesses diverge and diversify in two entirely different directions. The minimum guaranteed price will continue to provide a safety net for those growers lacking market access or unable to produce suitably high quality for the more discerning customers. Meanwhile, competition amongst the leading specialty coffee roasters and importers will continue to mean that prices far above these guaranteed minimums will be necessary to secure the pick of the crop based on cup quality.
