- Written by Ronald Sofe, Research Fellow, Economic Policy Research Program, PNG National Research Institute Ronald Sofe, Research Fellow, Economic Policy Research Program, PNG National Research Institute
Papua New Guinea (PNG) produces one of the best coffees in the world. Yet, majority of its citizen hardly taste locally-grown coffee. Drinking espresso brewed from freshly roasted, grinded beans is a new thing for many. But this is changing as people live, work and travel around the world and experience way of life that inextricably connected with coffee. Within the precinct of Port Moresby, for example, one would now find cafés serving espresso latte, mocha or cappuccino brewed from locally-produced beans.
The country’s majestic, pristine highlands provide a perfect climatic condition for the cultivation of high-quality coffee beans, mainly Arabica. In the early days, the crop was cultivated in large plantations but now, its production is dominated by smallholders who grow it on their customary land. Coffee continues to remain an important agricultural commodity, generating sizeable foreign exchange and creating employment for bulk of the rural population. Majority of the smallholders rely heavily on coffee income to meet daily needs and social obligations like school fees and medical expenses. However, over the years, the production level has alarmingly declined, impacting production of quality beans. This commentary briefly highlights notable challenges impacting performance of the industry.
Coffee is traded globally and therefore, its price is subject to instability in the international market. There is often fluctuation of global price of coffee where instances of high and unexpected swings are expected, often attributed to weather woes that may reduce supplies in major coffee-producing countries like Brazil and Vietnam. Consequently, this has adverse impact on coffee production in PNG. Coffee income remains highly vulnerable to volatile market price which subsequently constrains the ability of growers to earn a stable form of income. Better prices from sale of parchment or green beans can be considered an incentive for coffee farmers to remain committed in coffee husbandry and post-harvest undertakings. However, it is different when the price is unfavourable. Farmers are very sensitive to price these days. They are more inclined to switch their time and resource to horticulture or alternate activities that show promise of higher return.
One of the issues unique to PNG coffee is its inconsistency and unreliability of quality. Whilst this can be argued as ill-effect of price disincentive, the quality is greatly influenced by the smallholders’ production method which is different from the one practiced by the plantation. Smallholders tend to think that quantity is a function of price, and hence hardly focus on quality aspect of production. The problem is further aggravated by declining or non-existent extension support that supposed to promote effective husbandry and post-harvest practices.
Crumbling infrastructures is widely acknowledged as a chronic problem in PNG. Growers of organic premium coffee variety in higher altitude and remote places often find it difficult to access market in the face of failing rural roads and ailing bridges. High costs associated with transportation and processing of beans discourage the drive to produce quality. Rife in law and order problems hardly create an environment conducive for entrepreneurs to invest their capital, time and resources. Fragmented land ownership system is another inherent issue that limits expansion of coffee cultivation. Moreover, ongoing tribal conflicts and increasing population exert enormous pressure on the use and availability of land. The rural–urban migration in search of better opportunities is shifting needed labour away from cultivation of the crop. Many smallholders can only get as far as farm-gate price because the requirements for organic certification and export licence are beyond their capacity.
Despite these challenges, the personal touch and organic nature of PNG coffee through smallholder production, has its own uniqueness and value for niche markets. There is a great potential to tap into global demand for organic coffee to access premium price. However, pragmatic and innovative solutions are needed to address the challenges in order to revamp the industry and improve production of quality coffee.
This article was first published in the Post-Courier’s 29 April 2021 edition and on its website’s commentaries and features page.