Sunday, April 17, 2011

Coffee industry ‘stagnant’, at cross roads: CEO

The coffee industry has been “stagnant” for the last 10-15 years and needs to be revived, according to Coffee Industry Corporation chief executive officer Navi Anis.

Coffee Industry Corporation head office in Goroka.-Picture by MALUM NALU
Coffee is currently averaging 900,000 bags per year since the all-time high of 1.23 million bags in 1998, following the drought of 1997.
Papua New Guinea is one of 60 coffee-producing countries and accounts for 1.1% of world exports, however, has found a niche market as one of the great coffees of the world.
Despite this hibernation, statistics show that coffee remains the single most- important commodity at smallholder level in PNG – ahead of coconut, cocoa, palm oil and rubber - and smallholder coffee growers remain the backbone of the industry, given the decline in the estate (plantation) sector
Anis made no secret about this in an interview after last Tuesday’s launch of the coffee segment of the US$46.3 million Productive Partnerships in Agriculture (PPAP) project at the University of Goroka.
“The industry is stagnant and at its crossroads,” he said.
“It has been for the last 10-15 years.
“It needs a push start.
“This PPAP facility is very timely.”
Anis said to overcome this stagnation, investment in coffee – specifically through rehabilitation and new planting - was required.
“The PPAP project is timely and represents the single-biggest intervention since the coffee leaf rust eradication programme of the late 1980s,” he said.
“Successful implementation will have a positive impact on the industry.”
Anis said apart from the stagnation in production, other major issues and challenges for the industry included:

• Decline of the estate sector;

• Inconsistent smallholder coffee quality with resultant discount (up to 14%) in the World Market (NY “C”);

• Potential threat of coffee berry borer;

• Rural infrastructure and transport;

• Land tenure issues;

• Coffee theft (cherry); and

• Lack of Investment (growth and production)

Anis said the way forward in production was through mobilisation of smallholder coffee growers as production units (co-operatives); demand-driven research and extension; rehabilitation of all aging senile coffee trees; establishment of nurseries; and expansion into new growth areas.
In marketing, he suggested mobilisation of smallholder coffee growers into co-operatives; promoting marketing systems which revolve around quality and price premiums; and product development for niche market such as product profiling and consistency, certification and branding.
CIC was established under the CIC (Statutory Powers & Functions) Act 1991 and is a company registered under the Companies Act, empowered with state regulatory powers and functions.
It represents a merger of Coffee Industry Board, Coffee Development Agency and Coffee Research Institute.
It has board representation by government (three) and industry (nine) – comprising of smallholders (six), blockholders (one), plantation processors (one) and exporters (one).
CIC get its funding from export levies and other internal revenue, direct national government funding through recurrent and public investment programme, donor agencies, provincial governments and private sector.
Functions are industry regulation; research and extension; and promotion.
Mission is to maximise financial returns to all coffee growers; and contribute towards the government’s economic and social policy goals.

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