Equator Travel Blog

Nicaragua Trip - Securing Quality and Microcredit - January 2008

Posted on Mar 05, 2008 Bookmark and Share

by David Pohl
I traveled to Nicaragua at the end of January to visit our main supplier there, Aldea Global. The objective of this trip was to secure quality through farm visits and evaluation of our first microcredit initiative. img_9560.jpg

Aldea Global is managed by Warren Armstrong, a former Peace-Corps volunteer with ties to Jinotega that go back the early 1980s. In 2001, Warren returned to Nicaragua to conduct research for his PhD. dissertation, but put this aside to take the reins at Aldea, which was in need of an executive director. We first met Warren shortly thereafter when he called on us with samples of his coffee, and we have been buying his coffee ever since. Warren has constructed a formidable export cooperative that is comprised of 1200 members and 25 staff members. In addition to organic and Fair Trade coffee, Aldea Global exports malanga, a tuber akin to the potato, but about five times the size. The malanga provides much needed income to coffee farmers during the off season and helps them diversify their sources of income. hpim0909.JPG

The offices of Aldea are labyrinthine and fast-paced. There is a large coffee percolator brewing coffee all day and night, as people regularly work until seven, while Warren usually stays on until ten. I asked him why he worked such long hours and he said it is the only way to build an organization - hard work and elbow grease. His door is always open and people are constantly coming in to see him. Warren and his staff are very knowledgeable about the coffee market. They watch the market constantly, and fix contracts when the market is favorable and only after most of the coffee is in the warehouse. This ensures that they have the coffee they have agreed to sell and can afford to pay farmers the going market rate. If Warren fixes contracts too early, he runs the risk that he will not have the funds to pay farmers the market rate, if the market happens to go up. And if he can’t pay the farmers the going rate, they will probably sell to someone else. hpim0917.JPG

Warren is also acutely aware that Aldea can’t have all of it eggs in one basket. The coffee market is, after all, predictably unpredictable. This is why Aldea is pursuing a malanga export program to complement its coffee activities. To my surprise, malanga is popular in areas of the US with a high Latin American population, especially Miami. Coffee farmers have always grown it, and used it for domestic consumption or sold it on the local market. By tapping into the international market, Aldea is attempting to generate another source of income that complements their coffee crop. Malanga is harvested during the off season, and it therefore provides income when farmers need it the most. I discovered during my brief visit to Aldea that perhaps the most difficult obstacle for coffee farmers and the rural poor in general, is that they have virtually no access to long term credit. With an average income around $2000, coffee farmers have nothing left, after taking care of basic needs, to reinvest in the farm. Thus the $3000 microcredit fund we set up with the Sopegsa coop, an affiliated member of Aldea and the producer of our coffee the past two years, was very welcome. The nine farmers that received funds from this program have built fermentation tanks, improved their depulpers and laid concrete drying patios – all critical elements in the production of quality coffee, yet for most farmers out of reach due to a lack of credit. I was amazed at how far $400 dollars could be stretched, but also at how much more work was yet to be done. At the end of my trip I reviewed the amazing work Sopegsa had done and expressed a desire to the credit office at Aldea to find more funds so that Sopegsa can continually invest in their farms, as much to improve their coffee as their quality of life. I am awaiting a report from Aldea on next steps. With this I will meet with international lending institutions that might be able to offer long term credit to beef-up the revolving fund we have already set up. img_9501.jpg

Our Aldea Global/Sopegsa coffee arrives sometime in April or the beginning of May. In past years it has been characterized by a sweet acidity, light body and chocolate notes. We love it and you will be able to buy it as a single origin, or in our Volcano Blend. We hope that with the funds we have invested in Sopegsa, and the wonderful technical, processing and export skills provided by Aldea Global, this year’s crop will be the best yet. Web Album: http://picasaweb.google.com/davidnpohl/NicaraguaAldeaGlobalJinotegaJanuary2008

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