Coffee Processing in Africa
Here at the BGF we talk about how one of the ways for developing countries that depend on coffee production can keep more value in-country is to move into processing as well as growing. For fresh roast and ground coffee, this is difficult as, once coffee is roasted, it only has about a 12-month shelf life, so if it is be sold into the US or Europe or the emerging markets, such as China, it would have to be air-freighted and would still need to be sold quickly.
It’s easier for freeze-dried instant coffee, for several reasons. Firstly, it has a longer shelf life; secondly, it is processed to a pretty uniform standard (unlike fresh-roast coffee which is roasted to local tastes); there is also a large and growing domestic market in the developing World for instant coffee.
On the down side, freeze-drying coffee is a massively capital intensive process and requires a huge amount of capital investment, which is often beyond the reach of developing country budgets. This opens opportunities for the multi-nationals to step in, locate the processing plants in the growing countries, and to keep the value from this. This extract from the Ugandan press, report on a new processing plant being developed there.
Kampala, Uganda – After failed attempts by foreign investors to set up an instant coffee plant in Uganda, the Private Sector has now taken up the initiative to implement the project.
The instant coffee plant will add value to Uganda’s coffee that is currently being exported in its raw form with no value added. Being a capital intensive project of about $15 million, the private sector wants Public Private Partnership (PPP) with Government in order to deliver it. When in place, the plant will be able to add value to Uganda’s exports by a factor of six.
“Way back in the early 1990s, many people had been coming saying they will put up the plant. But this entire time people have been coming and going. Now we are saying why don’t we take up the project,” said Robert Waggwa Nsibirwa, the President and Chief Executive Officer Africa Coffee Academy.
“If we can add value to just 20% of our coffee, we would increase the value of the 20% by a factor of six from $1.5 per kilogramme of green coffee to $9 per kilo of instant coffee”
Uganda is the second biggest producer of coffee in Africa and 10th in the world, but the country does not add value to her exported coffee. Statistics show that “If you asked me about the instant coffee project, I will tell you that it is long over due. We would already be adding value to our coffee,” said Silver Ojakol, the Commissioner External Trade, Ministry of Trade Industry and Cooperatives. “My argument has always been that you can’t ask a foreigner to come and set up an instant coffee plant when the private sector is here”.
The Minister of Trade Industry and Cooperatives, Amelia Kyambadde urged Uganda coffee processors to put emphasis on branding. “Branding of Uganda products is still a problem. Even to look for the word made in Uganda s a problem,” Kyambadde said while observing one of the tins packed with Star Coffee.