Green bean supply chain manager Olam Coffee has set itself an ambitious roadmap and targets to help safeguard the future of coffee production.
The sustainability of the coffee industry is facing many challenges, with millions of smallholder producers feeling the impact of climate change and volatile prices.
One of the world’s leading green coffee origin exporters, Olam Coffee, has spent more than a decade working on the ground in 18 producing countries to help coffee communities improve their livelihoods. This includes providing its sourcing network of about 424,000 farmers with greater profitability, access to education and training, and protection of surrounding landscapes.
In October 2020, Olam Coffee strengthened its commitment to sustainability, with the release of Coffee LENS. Standing for Livelihoods, Education and Nature at Scale, the roadmap sets the business’s first formal and public sustainability targets, which it intends to hit by 2025.
Juan Antonio Rivas, Senior Vice President and Global Head – Coffee Sustainability and Business Development at Olam Food Ingredients, tells Global Coffee Report that Coffee LENS unifies Olam’s efforts across the supply chain.
“We’ve been evolving our sustainability programs and ambitions in coffee for a long time,” Rivas says. “Devising a comprehensive strategy with clear ambitions was like putting together a complex puzzle with a lot of different pieces. It’s not only about finding a direction and setting targets, but taking action to make a positive impact.”
Aligned with the United Nation’s Sustainable Development Goals, Coffee LENS focuses on four priority areas: economic opportunity, education and skills, climate action, and healthy ecosystems.
In an industry as diverse as coffee, Olam had to identify the most pressing problems producers face across the globe.
“Each supply chain is different. This structured approach is geared towards partnering with customers, non-governmental organisations, and other stakeholders, to tailor support according to the particular economic, social and environmental circumstances of individual farmer groups,” Rivas says.
“As a company, Olam Food Ingredients works with many different agricultural products and has set a very comprehensive sustainability framework with 10 key material areas. We prioritised the four most relevant to coffee.”
In terms of economic opportunity, Olam Coffee aims to improve the productivity and incomes of 200,000 coffee households through technical support and enabling access to higher-value markets. A second target is to train 100,000 coffee households on sustainable agricultural practices and basic business skills.
“There is a growing consensus in the industry that farmer livelihoods must be the top priority to guarantee a sustainable future for coffee,” Rivas says. “If it’s not economically viable for farmers, then there is no incentive to continue farming and the industry will not be able to continue supplying the growing demand.”
Before Coffee LENS, Olam trained 34,000 farmers last year on sustainable agricultural practices and had registered more than 4000 farmers on its Olam Direct platform, a buying app that allows producers to access daily coffee prices, as well as negotiate and transact directly with Olam, so they retain more value of their coffee.
“With economic opportunity, the best way we can deliver improvement is often through delivering training on the ground to farmers so they can increase quality and yields,” Rivas says.
Education and skills, Olam’s second priority, focuses on ensuring training and resources go to those who need it most. Olam will implement education remediation plans in all “high-risk coffee supply chains”, areas the United Nations Educational, Scientific and Cultural Organization defines as having low school attendance.
At the end of 2019, Olam had 12 school infrastructure programs in place. One example is a high school co-funded and constructed in the Kasama district of Zambia with Promoting Equality in African Schools and the Costa Coffee Foundation, to improve access to secondary education in the rural communities around Olam’s Kateshi coffee estate.
Olam also runs family succession projects with 1390 coffee households worldwide. “Coffee has a demographic challenge, with the average age of coffee growers increasing. We want to ensure generational succession, by promoting opportunities in agriculture to a minimum of 10,000 children and youth through vocational training,” Rivas says. “Encouraging young people to see the value of coffee production is important for the sustainability of the industry.
“Another issue is gender representation. Coffee production is male dominated in most countries. We want a minimum of 20 per cent of those trained in good agricultural practices to be women.”
Training more farmers on sustainable agricultural practices will contribute to Olam’s third priority: climate action. Coffee production is heavily impacted by climate change, but it is also a contributor of carbon emissions.
Through improved land-use management, climate-smart farming and post-harvest practices, and more efficient energy use, Olam aims to reduce greenhouse gas emissions across its supply chain by 15 per cent by 2025.
“This will be extremely challenging for us, because if you look at the carbon footprint of any agricultural product, cultivation is the biggest contributor,” Rivas says.
“Reducing our emissions by 15 per cent requires a comprehensive and holistic approach across multiple areas of production and processing, like teaching farmers how to use energy and fertiliser in a more efficient way, planting trees, and ensuring there is no deforestation.”
Olam distributed 138,000 non-coffee trees to farmers in 2019 to help farmers diversify their farms, so they can act as carbon sinks, thus reducing CO2 emissions.
Creating and sustaining healthy ecosystems is Olam’s fourth priority under Coffee LENS. For Olam, this will mean ensuring coffee supply chains are deforestation-free and that farms have healthy soils and biodiverse landscapes.
To achieve these goals, over the next five years, Olam will plant five million native tree species, implement remediation plans in “high-risk sourcing areas” according to the Forest Loss and Risk Index, and improve soil health across more than 20,000 hectares.
“With the impact of climate change on coffee yields, there is growing pressure in some countries on farmers to expand or move their farms into forests and national parks in search of more suitable growing areas. We need to remove the economic incentive for farmers to encroach into these biodiverse-rich areas and protect them,” Rivas says.
“Another environmental challenge, especially with washed coffee, is water use. This processing method typically requires a lot of water so we need to help farmers reduce the amount they use and make sure it is treated and recycled to avoid contaminating soils and local water sources.”
Olam Coffee’s targets include saving one million cubic metres of water annually in coffee cultivation and processing, and reducing untreated wastewater effluent by 50 per cent.
Already, Olam’s Sironko washing station in Uganda was able to treat and recycle 150 million litres of waste water during the 2019 crop year. Before being released, wastewater was treated onsite, with the discarded pulp composted for use instead of chemical fertilisers.
Olam will share progress on Coffee LENS annually, which will be tracked and supported by data from its sustainability insights platform AtSource. AtSource was developed to allow coffee companies to trace their beans all the way back to the estate or farmer group they came from, with detailed analysis of the social and environmental footprint at each stage of the journey. Rivas says these metrics will provide Olam with accountability for reaching its Coffee LENS targets.
“It’s a five-year ambition. We’ve defined our priority areas, set targets, and are now in the implementation stage, which is the most challenging and exciting part as well. But it won’t end in 2025. We’ll continue to challenge ourselves in the future with new, more ambitious targets.” he says.
“Because of the size and scale at which we operate, we have a responsibility to contribute to the sustainability of the overall coffee sector. But no single company can solve all the industry’s problems alone. This is why we’re looking for new alliances with our partners – customers, governments, financial institutions, multi-lateral agencies and NGOs – to increase the impact of what we’re already doing to build a more resilient coffee sector, one where farmers prosper and landscapes flourish.”
For more information, visit www.olamgroup.com/products-services/olam-food-ingredients/coffee/sustainability-in-coffee.html