FAL Coffee

by Byron Holcomb Director of Agribusiness

What do all three have in common? They all produce coffee. Let me explain, but first. . .

It is now time to officially let the cat out of the bag – we purchased a CoE winning farm in Carmo de Minas – Fazenda Monte Verde. The coffee is absolutely delish, the farms topography is breath taking, and there is something charming about the humble and brilliant people in Carmo. I could go on and on for hours about this piece of land, how it is one of the featured farms in the Denomination of Origin program with all 4 aspects having coffee; north, east, south, west. It has about 40% Yellow Bourbon in production. We purchased the farm in January of 2014 and are just now starting to get our feet under ourselves. There are some really fantastic farm workers on the farm, who where fantastically trained by the prior owner Jose Roberto Canato, truly a brilliant man. This year we simply hope to keep up his winning streak in quality. I’ve identified a couple opportunities for improvement, but in all transparency my approach here is to learn from this system that is in place and what makes this coffee so delicious. Basically, I don’t want to screw it up. 

Fazenda Monte Verde

If things go according to plan, and they rarely do in agriculture, we should have some of this coffee for sale this year. Our roasting and retail operations will consume about 20% this year’s crop. Let alone from both farms.  So we will be looking to find a good home for some of this coffee for sure.

A couple months back it was all the rage to talk about the lack of vegetal growth on skeleton pruned coffee in Brazil, which would compromise the harvest in 2015 severely. (Vegetal growth = branches and leaves = nodes = where coffee flowers = where coffee fruits = usually measured in pairs of leaves = 10 pairs of leaves is a great number). Brazilian farmers know a thing or two about selling coffee and coffee markets. As much as they hate to see production dip, they love to spread bad news in hopes of pushing the market up even just one point, which doesn’t mean penny, here it means 100th of a penny on the pound. 

I thought it was too early to start spreading that kind of news when the “supposed to be rainy months” weren’t even over yet. Now they are over. Ok let's talk about vegetal growth – honestly I saw trees that grew several nodes in March. The rains came in and the trees grew horizontal branches like, well normal, just much later than normal.

Solar Panels – here I’m talking about leaves. Plain old green glossy leaves. That is what leaves do for plants. They absorb solar energy, use some CO2 and tadaaaaa the plant has energy to produce fruit and all the other vital things that enable our daily consumption of coffee. More sun, more solar energy. This harvest should start early because well the trees have been basking in lots more sun than normal. Not only that everyday the UV indices are “red” as in danger. On Santa Izabel and our new farm in Carmo we now start at 6am so the workers can spend less time in the intense summer/fall sun.

Water Pumps – here I’m talking about trees. That is what trees do. They pump water from the ground up and out through the underside of their leaves. Sure they have been under massive stress and so much so that the tree was signaled to actually flower. I have lots of pretty pictures of flowers in February. But what happened March – well we had some rain. April? More rain. Last week I almost didn’t’ make it to the office. In 4-wheel drive low, my tires spun all they way up the hill at a snails pace. Again, another argument to expect an early harvest.

The effect of these solar panels and water pumps is like a cars’ turbo. It takes the normal system and kicks it into high gear. In theory the harvest should come early. When I look at our farms through my Central American lens – it is time to pick. In Brazil they say wait until the top of the tree start to over ripe then start. Our farm managers say hold the line until the normal picking season (mid May) then release the pickers to get the coffee off the tree.

The dangers here are never as simple as wait for it to turn red (or yellow). In years like this I like to say you can’t trust your eyes, because a tree that is loaded with coffee starts to direct its energy into its fruit so red doesn’t mean ripe. So when heavy rains hit during a harvest the cherries sometime “explode” or the cherry skin cracks open and of then the cherries are also pushed off on to the ground. Trees coming out of such a stressful final development (too much sun, not enough water), are going to try and “rush” their coffee to be ripe to make that seed viable. I simply hope for light rains that don’t really saturate the soil and think we shouldn’t rush in and start picking because a few trees are ripe - errr red (but this is really tempting). I don’t really have faith in the Brix meter to indicate perfect ripeness but we will be using it again this year.

Picture taken from Santa Izabel on April 1st. 

Picking in in Brazil is like trying to hold a fire hose off a hydrant. It takes many people and you must think twice as to where you point it. Picking in Central America is like holding a garden hose with your thumb. A little here a little there and back again.

by Byron Holcomb Director of Agribusiness

The Ype’s (flowering trees) are exploding. This is a good thing. I’m told the bright yellow flowers are the first sign of spring. When I traveled here as a buyer I only came in the July/August season to cup coffees and see the farms. So my impression of Brazil is of a dry, often dusty country with cold nights. Well having arrived here just before the harvest started and seeing it through, I now celebrate the bright yellow Ype flowers like never before. I’ve watched the grass go from a verdant green to dusty hay. The coffee trees went from beautiful green to a less green and less leaves version.

We had several light frosts on the farm. The only death was of the already dry grass on some of the pastures. The tips of some coffee leaves on the lowest parts of the farm did “burn” a little.

I have a rather complicated history with avocados. My Peace Corps project in the Dominican Republic was centered around them, my coffee farm had 495 of them when I purchased it (it now has two), and I like eating them. Eating isn’t complicated. Avocados are a great fat. In the Dominican Republic they are used as a meat replacement (often in poor rural areas). It usually did the trick. They were the long shiny green avocados (variety 6032) or small purple “criollo” (some heirloom variety there) that tasted better with beans and rice.  Last week, I cut a piece of avocado and put it with my beans and rice to eat. As I walked out on the porch Jose Angelo, leaned back in horror, “you are going to eat avocado with rice and beans?” Before I could explain he launched into a tirade about how he made guacamole once and how it was so awful he threw it away. “YOU are supposed to eat avocado with sugar”. I never understood this until recently. I love savory but sugar on my Has (small black avocados often sold in the USA) avocados didn’t sound like anything I wanted to eat. Jose Angelo challenged me to eat the rest of the avocado with honey. It was delicious, much better than the salty version I made. I guess it all comes down to the variety. This was a big deal for lunch last Tuesday.

by Bryon Holcomb Director of Agribusiness

I've been mulling on how to say this since the drought started in January. It isn't an obvious bad news, good news answer. Clearly the market has taken advantage of the moment to break historical records. 

This really is a question of perspective. Every year it pours rain in January here. Sometimes as much as 25% of the annual rain comes in the month of January. This year was extremely different. If you are a small farmer coming out of low market prices, this is a perfect storm (especially if you went to the bank with pictures of the text book flowering to get a loan). If you are a medium sized farmer, you might be adjusting your crop expectations down as far as 30% because that flowering simply didn't convert to greens on your trees now. If you are a big farmer with irrigation, I have no idea because I'm not one, but you probably think you are a genius to have installed irrigation on part of your farm. If you are a person living in the State of São Paulo, you might be talking about the water rationing going on because the water reserves are now below 30% and that same water can't turn the turbines of the hydroelectric damn, hence the brownouts or electricity rationing in the State. If you are a commodities speculator, you love the volatility.

Questions to ask farmers in Brazil: 

How sandy/rocky is your soil? 

Could you (did you have the $ to) fertilize in November or December? 

Did you fertilize with urea or nitrogen? 

The only thing I can tell you specifically from experience here on Santa Izabel is that rocks and sand are the current enemy to the coming harvest of Brazil. The only bigger enemy is a bulldozer. I'll get to that later. 

Rocks and sand are great because they provide an extra dose of minerals for coffee and tend to produce more coffee in normal conditions. And the coffee in rocky areas looks just healthy. 

Rocks and sand are the worst for this crop right now because they don't retain water and they do retain heat. A lot of the problem with a drought isn't what is above the soil it is what is below the soil. All day long 90-100º F temperatures on soil is a lot. Especially when this season is supposed to be more like 80-85º with a few hot days in between daily rains. The solar radiation drives the moisture way and the rocks and sand soak it up like lizards. Over night when the cool damp air moves in the rocks and sand slowly start to normalize by releasing that heat. Unfortunately the long summer days win and the short cool nights can't give coffee planted in a rocky area a time to recover from the heat of the day. Only one section of Santa Izabel looks visibly stressed, and that is the section that has sandy and rocky soil.

Now the coffee with heavy clay based soils looks fine. Here on Santa Izabel our coffee leaves in this soil only started to droop after three plus weeks of no rain. In other areas like Espiritu Santo do Pinhal, they looked like they were barely hanging on only two weeks into the drought. In Carmo de Minas over all the plants looked pretty good. I lend this to the fact that their nights are actually cold. Down to 55 to 60 at night is normal there. 

I think the fall in production in South Minas will be around 10% - 15%. I can't really speak to other regions but sandy-based soils with out irrigation . . . that might be serious.

The fall in production in South Minas would more likely be to people converting to cattle production from coffee. Aka bulldozer treatment. We have a few neighbors here who this last harvest "broke them". Now they are doing what has a lower cost of production, planting grass for cattle. Some might not be financially broke but they did give up on coffee. Cost in local market was about R$220 to R$240 per bag and the cost of production in this region is R$350 to R$400 per bag. 

Because many farmers can't pay the bills from last year many are eliminating sections of coffee of the farm to only maintain a section or half of what they used to have. Many can't afford fertilizer so the development of what could have been a near perfect crop (after near perfect flowerings), is now a burden that the trees can't handle. So they are pushing greens off (aborting) or simply not able to develop them to cherries, so the develop black defects.

The last fertilizer application (nitrogen) depends on moist soil and light rains. Most regions don't have either. So the result are trees that are now stressed from too much sun, lots of coffee on the tree and now are showing nitrogen deficiency. - Yellow in the middle of the leaves. Farmers don’t want to apply nitrogen because they know the tree will never get the “food”. Nitrogen will volatize before it ever gets integrated into the soil.

Rain . . . well I can tell you what little I know. In January and February last year we had 301mm and 159mm of rain, respectively. This year we had only 90 mm and 45 mm of rain. It is actually better than many people who had even less. The rains that were scheduled in late February have not restored the damage done only given a little bit of hope. It was enough for us to resume planting, but not what the plants need while they are all forming the coffee cherries. We stopped planting again today because the soil is dry and hard. . . again.

Greetings from August in Brazil - I know that it is January, but it feels like August here, extremely hot with occasional rains to stop you from sweating. This January our farm in Ouro Fino has received only 90 mm of rain. In 2013 we had a typical January with 301mm of rain. Actually it has been so dry I’ve seen flowers on both of our farms open because of the slight hydraulic stress on the trees.

Speaking of our second farm. We doubled-down on quality by buying our second farm in Carmo de Minas. After months of evaluations of dozens of farms we decided on Fazenda Monte Verde. The coffee is super delicious. The farm is a CoE winner every year. The production is with about 4000 bags projected for this year. It has 40% Yellow Bourbon covering the farm.

We are extremely excited about this farm joining our family. Unlike many farms that were evaluated, which needed massive amounts of investment (AKA old tired coffee trees and mill improvements) Fazenda Monte Verde is “ready”. It has a proven pedigree in quality, the staff here keeps the farm looking like a through-bred horse, and on top of that there is something special about this piece of land. Don’t believe me; just come see it and you can see if I’m crazy. I don’t know if is the 29 water springs that start here or the East – West orientation of the valley. It could just be the topography and aesthetic.

by Byron Holcomb Director of Agribusiness

I’m not sure why but usually about 2/3’s through a coffee harvest I can’t wait for it to be over. Some time next May will be so excited for the harvest to start. Then I predict next August, I will be hoping the last cherries are picked and dried.

Our first harvest on Santa Izabel was pretty great considering our volume estimates are being hit, we had some promising cups on the cupping table and have realized that we were lucky to have some fantastic people in place when got here. We were actually very excited to make it through the National Finals of the Cup of Excellence. I’m not sure what our place was but there were only 57 coffees that made it through out of almost 400 entries. We didn’t make it through the International Jury, but I’m not disappointed because for our first year the National Finals was a huge success.

September 30 marks the beginning of the next “ano agrigola – agricultural year”. That should be the date when your harvest is over and you launch into prep for the next harvest cycle: weeding, fertilizing and pruning all at full tilt, but not in that particular order. Usually pruning, cleaning and then the first set of fertilizers.

The first flowering in Ouro Fino was textbook perfect. A very dry August helped stress the trees (hydraulic stress = more flowers), then a couple light rains helped queue up a nice bunch of flower buds, the flowers opened in late September, and the best news is that 4 days of rains followed. I honestly think we had about 95%+ of those flowers take. Then the second flowering followed a similar pattern, it was a touch smaller than the first but still pretty large and it also had a few days of rain following which is great for what we hope to be a big harvest.

I was counting my lucky stars when I left Brazil for a trip to the Dominican Republic last week. My tiny little farm is starting to harvest. The leaf rust here is pretty terrible and some farmers have said, “I don’t even have coffee to drink this year, much less to sell”.

Then today I got an update from Brazil and it was pictures of hail damage. Yes hail. I knew that something had to go wrong because the first two flowerings were too perfect. Not all hope is lost. We only are operating with a hole in the roof of the office but the hail was small so the employees in the field and the coffee trees are ok.

Our terraces are doing pretty great so far. There is one that has been problematic, but that also means it is also the one that is teaching us the most lessons.