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Coffee Co-Op in Honduras
Category: Microcredit | By Steve, 30-May-2018 | Viewed 1728  Comments 0 | Source Kevin Hanson

Coffee Cooperative develops successful Microfinance community

SANACAFE Coffee Drying Racks

This last April, Rotary and Rotaract members primarily from Rotary District 5360 had the opportunity to visit a coffee cooperative in the Santa Barbara region of Honduras. 

This coffee cooperative is called SANACAFE, and it originally started in 1967. It closed briefly in 1991, but then re-started in 1994. There are 240 families who work in this cooperative, some of whom are third generation members! Together this cooperative produces 15,000 to 20,000 sacks of coffee each year (one sack = 100 lbs), much of which is exported to destinations such as Denmark, Finland, Germany and the United States. The coffee plantation is at an altitude of 1000 to 1400m, and covers an area of over 1600 hectares! The quality of coffee coming from this region of Honduras is considered quite high.

The farmers of SANACAFE cooperative get external support from two separate means. The first is that their cooperative is fair trade certified. This means that the coffee they sell has a guaranteed price that is approximately $20 per sack higher than the market price. For example, at a baseline price of $140 per sack, the SANACAFE cooperative would be able to get fair trade pricing at $160 per sack. This extra $20 then gets directed towards various initiatives to improve the quality of life of the cooperative members. Approximately a quarter of this ($5) gets spent on better wages for the coffee farmers, while the rest ($15) gets spent on community social projects that benefit the cooperative as a whole. This can include things like school construction or watershed reforestation projects.
Coffe Cooperative Executives

In addition, the SANACAFE coffee farmers get investment support from Rotary partner IDH Microfinance, which provides small loans to the cooperative that allow for the expansion of their business. The coffee growing business is very cyclical with only one harvest per year. In addition, with unpredictable weather variations and climate change leading to the occasional failed harvests, farmers can often go long periods without taking in new revenue. Small business loans as offered by IDH that are available during the low revenue points in the coffee growing cycle can be a very useful bridge and lifeline that allows for members of the cooperative to build infrastructure, expand their farming acreage, and otherwise make improvements that will improve the productivity and yield of their subsequent harvests.

One of the farmers in SANACAFE that we spoke with was Benjamin. He along with his wife Kenya are among the founding members of the restarted cooperative, and they are using loans from IDH to improve the size of their farm, and also to diversify into sugarcane. Over the last five years, living conditions on their farm have improved, their soil erosion management practices have progressed, and the size of their farm has doubled.
SANACAFE Insight Trip Participants

Going forward, Rotary partner IDH will continue to operate a branch office in the Santa Barbara district of Honduras, where they will assist in setting up new coffee cooperatives in the area, along with providing ongoing support to existing partners like SANACAFE. The members of Rotary District 5360 are proud to provide continued support to coffee farmers like Benjamin through IDH, and we look forward to our next visit to Honduras to see the continued progress they are making in their lives.

Kevin Hanson is a member of the Rotaract Club of Calgary, and is employed as an oil & gas petroleum engineer. Kevin has traveled extensively in Latin America and southern Africa, and has previously done overseas international development work with Engineers Without Borders Canada. kbhanson@hotmail.com 604_789045704.JPG
Kevin Hanson Rotaractor
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