Casa Brasil & Torchy's Tacos Brazil Trip
Last August our friends and partners at Torchy's Tacos traveled with us to Brazil. During the visit they had the opportunity to meet with some of the growers that produce the coffee that is sold alongside their famous tacos.
We were fortunate to have Torchy’s partners Mike Rypka and Jay Wald travel with us to Brazil this harvest to meet some of our growing partners.
We’ve had the pleasure of working with Torchy’s from their early days, and it has been exciting to grow with them over the years.
Their growth has been great for us as a company, but I wanted to write a short blog about the impact a company like Torchy’s can have when its coffee is sourced directly from the growers and there is not only traceability, but a relationship that is maintained throughout the supply chain.
Hopefully you have had the chance to try Casa Brasil’s Torchy’s Blend. Here is a little bit about the coffee:
- The coffee scores at or above an SCAA 83, a score that is significantly higher than coffee offered by Dunkin Donuts, Starbucks, Peet’s, and many others.
- We source directly from growers, import the coffee ourselves, and then roast the coffee fresh to order in Austin, Texas.
- We pay a price that is detached from the commodity market (more on this below) and offer full transparency to our growing partners.
I wanted to focus on two ways that Torchy’s and Casa Brasil are directly impacting lives through our partnership.
How Coffee is Traditionally Sourced.
First, let’s look at how coffee is traditionally sourced. Almost all coffee worldwide is purchased at a price that is based on the commodity market price. Coffee of higher quality may receive a premium over that price, while coffee of inferior quality may be discounted. While commodity markets serve a valuable function, there are several problems with this model.
One of the main problems is that the commodity market price is not linked to a grower’s input costs. Add to this the volatility of the market, and a grower cannot be certain of the value of their product at the time of sale.
Let’s Make a Sandwich
Imagine that you are a sandwich maker and you make and sell sandwiches for a living under the following conditions. (1) The price at which you will sell your sandwich is not linked to your costs. (2) You neither control nor know what that price will be when you sell your sandwich. (3) Your livelihood and the livelihood of your family comes from sandwich sales.
Under these conditions, how will you go about making your sandwiches? Will you go out and source the highest quality ham, the freshest lettuce, and succulent heirloom tomatoes? Probably not. More than likely, your main concern will be to keep your costs as low as possible to minimize your chances of selling at a loss.
This is the situation that predominates for the coffee grower, and while the growth of specialty coffee has provided larger premiums that mitigate this risk, it is still there along with the resulting caution against taking measures to increase quality, both on a seasonal basis and in terms of investing in infrastructure that leads to higher quality.
Now—back to sandwiches—imagine knowing that you will be paid set prices that are completely detached from the commodity market and based on the quality of your sandwich. The paradigm changes. You know that you will be rewarded for quality and will therefore likely make the effort to go out and make a damn good sandwich.
The impact of our direct trade business model really came out on our trip. Through Torchy’s growth and their partnership with Casa Brasil, an increasing number of smallholder growers, trapped for generations in the commodity market cycle, have been able to invest in quality and make the transition from being beholden to commodity markets to artisan growers that largely control their own destinies.
Alessandro Hervaz installed a solar dryer and raised beds on his patio to ensure quality. He is also expanding his production to a plot above 1,300 m, among the highest in Brazil.
Augusto Borges purchased a coffee cherry color sorter that helps to ensure that unripe coffee fruit, which tastes astringent, like unripe bananas, doesn’t make its way into his higher quality coffee. This investment of around $10,000 USD was made possible by the partnership.
Ademilson Noiman expanded his production, planting coffee at higher altitudes that will likely lead to higher quality coffee.
Sérgio Borges installed raised beds on his property, getting the coffee off the ground where it can dry more evenly, with a lower risk of contamination.
Sérgio Borges participated in our selective harvest project, moving from strip picking to hand-picking ripe fruit for select microlots [more on that here]
Knowing Their Work is Appreciated
So much goes into these growers’ coffee. Not only are they literally surrounded by it, it is their life passion. Historically, growers took their coffee to the local coop, and that was it. They never knew where it went, who drank it, or if people appreciated their work.
Knowing where their coffee is going and hearing directly from Mike and Jay how much their hard work is appreciated was an incredible moment. Some of the growers were brought to tears hearing about Torchy’s commitment to finding passionate suppliers who were experts on their respective trades. For growers that have historically been at the bottom of the supply chain, hearing and seeing the mutual respect given to them by Torchy’s was, in the words of Augusto Borges, “a life changing experience.”
Augusto Borges, a young coffee grower who is passionate about quality and sees coffee not as a commodity trade that he inherited and is beholden too, but a path where he can express his passion and creativity, and be rewarded for his innovations. Initiatives like Casa Brasil’s direct trade business model help make coffee production a viable option for younger growers, instead of leaving the farm for the city.
So next time you grab a cup of coffee at Torchy’s, know that those beans were grown by passionate coffee growers that care about your experience, and that each cup adds to the enrichment of lives, from you enjoying the final product to those who supply it. If you would like to send a message to the growers to let them know, please reach out to us on Facebook, Twitter, or Instagram and we will be sure to pass on to them.
Thanks again to Mike and Jay for making the trip. Words cannot express enough how much it meant to us and the growers. Thanks guys.
For the 10+ years that I have been coming down to Brazil to source each harvest, the process has usually been similar: request samples from some of the best farms and pick out their best lots. Over the years as relationships developed, this morphed into a model of transparency and pricing based on SCAA score for the coffee, independent of the C market. (The normal process, even for specialty, is to pay a premium over the C market price, wherever it may be at the time of purchase.)
This year I decided to try a different approach: rather than show up after the fact, why not guarantee price before the harvest for the growers to follow a series of protocols that had a better chance of yielding a higher quality coffee? These protocols consisted of choosing a high-quality potential farm lot (based largely on cultivar and altitude), performing selective harvesting of that lot, and then slowly drying the coffee (in raised beds and in a greenhouse, when possible).
The results were varied, but there were some incredible coffees that resulted from this project, including a coffee from grower Ademilson Noiman Borges that won the Fair Trade Coffee of the Year competition in Brazil. In general, the scores for these coffees were higher than the scores we had given in previous years for similar, non-selectively harvested lots. In the cases where the coffee scores were lower than anticipated (the expectation was that each lot would score at least an 86 using the SCAA cupping methodology, which is our cut-off for a microlot), while it’s a bummer, it does potentially provide insight into cultivar potential and post-harvest practices. Below I have elaborated more on this as well as some information about the project.
Some more details of the Selective Harvest Project
I. What is Selective Harvesting, and Why Does it Matter?
Short Answer: Picking only ripe fruit. In general, the coffee tastes better.
Medium Answer: Coffee goes through several blossoming events, meaning that the fruits “start” and therefore “end” their life cycle at different times – so the same plant and even branch can contain fruit of different maturations. Unripe coffee, sometimes referred to as “green,” has an astringent flavor that is akin to unripe bananas – not something you want in your coffee. With selective harvesting, only ripe fruit is picked, and the same tree must be picked several times as the coffee fruit ripens.
Long Answer: While the correlation is not exactly defined, it is accepted that seed maturation (what we really care about) corresponds with fruit maturation. That said, fruit maturation ends up being quite important because the visual appearance of the fruit, as well as its rigidity and the strength of its connection to the tree are factors in determining the point of harvest. Seed maturity, the point where the seed can germinate, actually occurs before the fruit is fully ripe. The last two phases of fruit maturation are the filling phase, where the endosperm fills in the cavity created by the perisperm, with its volumetric expansion defined by the hardened endocarp, and then maturation. While maturation is usually defined more by what happens in the fruit, mainly the softening of the mesocarp (mucilage) and the color change of the exocarp (skin), we know that the seed too undergoes changes, though these changes have not been completely defined. The endosperm continues to accumulate reserve compounds in its cell walls, and this is a good thing, since those compounds lead to a better beverage.
The other extreme of maturation is “dried on tree” coffee. This is coffee that has passed its point of physiological maturation and remains on the tree, drying and gaining a withered appearance. While these coffees can, in fact, be quite good, they carry a higher risk as, just like us, if left in the elements in this “elderly” state, they are more susceptible to degradation through, for example, mold attacks. This is especially true if it rains during the harvest.
Of note too should be the fact that it is largely accepted that coffee does not ripen after it is picked, nor does the application of ethylene while the fruit is still on the vine lead to more homogeneous seed maturation. Though it is currently an area of study, and their might be other benefits of such applications (weakening the peduncle for non-selective mechanical harvesting, for example), it is largely accepted, at least in Brazil, that while the use of ethylene does lead to a more homogeneous fruit color, it does not lead to homogeneous coffee seed maturation.
II. Why Don’t They Do Selective Harvesting in Brazil?
Short Answer: It costs too much. (This is actually a good thing.)
Medium Answer: The minimum wage in Brazil has risen significantly over the past 20 years, while coffee prices are largely the same. Add to this urbanization which has led to a sharp decline in the available rural workforce, and you have a lack of labor, and high labor cost when it is available.
Long Answer: Regarding the availability of rural labor, according to the Instituto Brasileiro de Geografia e Estatística (IBGE), the rural population in the Southeast region of Brazil (where most of the coffee is grown) has decreased from around 25% in 1970 to around 5% today.
Regarding the cost of labor, the minimum wage, called “one salary” in Brazil, largely serves as the basis for payment for any job. Given the required skill and labor supply for a job, the employee will make a multiple of the minimum wage (a tractor operator in southern Minas Gerias, for example, will make generally 1.5 to 2 “salaries.”) The additional tax burden per employee in the Sul de Minas region is 42%. In other words, for every $100 you pay the employee, you must pay an additional $42 to the government.
The minimum wage in Brazil increased from 155 reais per month in 2000 to 880 this harvest, or 5.7 times. While all of this is not a real (inflation corrected) increase, as there is an adjustment for inflation, the fact that coffee prices are pegged to the US dollar renders the real adjustment irrelevant, apart from the impact of the inflation on the exchange rate. And while they fluctuate greatly, coffee prices now are not significantly higher now than they were in 2000. Let’s say you have a sweater shop where, in the year 2000 you sold sweaters for $30 and paid your employees $5.15 an hour (US minimum wage). In 2014 you would still have to sell your sweaters for $30, but now you would have to pay each worker nearly $30 an hour.
For the harvest, which represents the largest cost for the coffee grower, workers in the Sul de Minas region demand at least $100 reais a day, or 3.4 times the minimum wage (the US equivalent of this would be $24.65 an hour). To get pickers to do selective harvesting (i.e. get good pickers and motivate them to be very selective), you need to pay far above $100 reais per day.
To get a basis for how much the selective harvest costs (and thus a fair price to pay), here are some base calculations. The numbers vary greatly depending on many factors, but after doing this, the biggest limiting factor was not determining price, but the lack of available labor. Even if you pay a lot, given the increased labor demands of selective harvesting, there are just not enough people to perform the harvest in the necessary time frame. Anyway, here are the base calculations
- Liters of coffee one person can harvest per day: 80*
- Ratio of fruit to 15+ green beans: 8 to 1, meaning that one person can pick 10 kilos, or 22 lbs. per day**
- Harvest labor cost per lb.: 100 reais/3.2 = 31.5 US dollars per day
- Therefore, the USD cost per lb for performing a selective harvest is 31.5/22, or $1.43.
By coincidence, the C Market price (Brazilian naturals) for July 2016 was $1.44 USD per lb. In other words, you lose a penny, just on the harvest. Of course the harvest is not the only cost. A good general cost number per bag of coffee excluding the harvest is 300 reais, or around $0.70 per lb.
* Our estimate of how many liters an average picker can selectively pick in an 8-hour day. Since selective harvesting is not done in Brazil and since this varies greatly depending on the maturation level of the fruit), this number varies and is hard to estimate. Based on my master thesis experiments and the estimates of our partners, we thought 80 liters was a good estimate, and, in fact, it turned out to be accurate (though again, these numbers varied greatly).
** This number again varies, depending on season (rainfall during the endosperm filling phase), cultivar, fertilization, maturation, etc. We used an 8 to 1 ratio – 8 kilos of cherries will render you 1 kilo of green coffee, screen size 15+
III. Why is Casa Brasil Coffees Doing this Project?
Short Answer: To source the best possible coffee. And we did. As mentioned above,a coffee from this project, a microlot from grower Ademilson Noiman Borges, won the Fair Trade Coffee of the Year award. This is the first time a grower from APAS has won. Several other coffees from the project scored in the high 80’s.
Medium Answer: To create quality and aggregate value at the farm level, thus justifying higher payments to our growing partners while offering our customers the highest possible quality. If you allow the fruit to mature on the vine and are careful in the post-harvest, then your coffee will generally be better than if you had not done so. As shown above, the reason most growers don’t do this is that they will lose money if they don’t get a massively higher price for their efforts. By knowing ahead of time that they were guaranteed this price, the growers could justifiably perform the selective harvest and take the necessary care in the post harvest.
Long Answer: On top of aggregating this value, Casa Brasil is doing this project to reap maximum results from a given terroir in both the short term and the long term.Regarding the long term, the intent of the project is to inform growers which cultivars are yielding better quality. With selective harvesting and careful post-harvest treatment, the interaction of genotype with the environment becomes more evident. In other words, if you remove the factors of various maturations and defects, then how different cultivars perform on certain farms, or lots in certain farms, becomes more apparent. Three lots of selective harvest coffees scored below 83 (our cutoff for microlots is 86). All three were Mundo Novo. While it is premature to judge all Mundo Novo, it does raise questions about its potential, at least in that specific microclimate. If those results continue, then growers must opt to either pull it up and plant a cultivar with higher potential (i.e., one that scores higher and thus receives a higher price), or relegate that lot to commercial grade coffee that is strip harvested. Other factors such as slope facing, shade, etc. enter in. Granted this is not done with the scientific rigor that would be best for making these kinds of decisions, but it is far and away better than the status quo, and it uses what, in my experience, is the largest motivator for growers to change their practices for the better – seeing their neighbors get a higher price per lb.
After 10 years of doing this, much of which has been spent in the field working with growers (and pursuing a masters degree in coffee production) I have been fortunate to have cultivated partnerships with growers with similar values, and it is these shared values, not oversight (real or BS), that lead to real aggregation of value, not merely the necessary “sustainability” copy that so much coffee marketing seems to demand.
IV. Where and when will these coffees be available?
We hope to ship the first container with these coffees by early November, meaning that the first lots will hopefully be available by late-December to early January.
Dulce Borges – APAS Coffee Roaster
For those that have had the chance to catch a glimpse (or a sip) of the Associção dos Produtores do Alto da Serra, or APAS, hopefully you have seen the incredible spirit of this small community of coffee growers in the hills outside of São Gonçãlo do Sapucaí, Minas Gerais. Dulce Borges is a member of the association and embodies a lot of what we love about working with them (apart from their incredible Brazilian coffees, of course). [read more]
A Look at Some of the Artists that Inspire Us
As we launch our new packaging (and complete our 10th year), I thought it might be worthwhile to show some of the artists that have inspired us along the way.
While the first connotations of Brazil are often soccer, beach, Amazon and bikinis -and perhaps often not in that order- there is an enormous cultural depth in art, music, and cuisine that unfortunately is not readily available through the normal channels and must be sought out.
Perhaps this is somewhat analogous to Brazilian coffee. When we started this coffee adventure, Brazilian coffee was often regarding as lower quality, lacking the depth and complexity that many in the specialty coffee industry sought. It wasn’t that the quality did not exist, but rather it was not being sought out. A decade later, Brazilian coffees are fetching record prices and are found in top-notch roasters the world over.
As we launch our revamped packaging this fall, here is a look back at our brand incarnations over our 10 year history. From our cultural center house theme to our Brazilian promenade-inspired new packaging, it has always been about bringing a little bit of Brazil to you. [read more]
Last week I taught my first Q Grader Course at the Brazilian Specialty Coffee Association (BSCA) in Varginha, Minas Gerais. For those not familiar with it, the Q Grader Cupping Certification is the main certification for coffee tasters, or “cuppers” as we call ourselves, in the specialty coffee industry. [read more]
As many of you know, for the last year I have been pursuing a masters degree here at the Universidade Federal de Lavras, or UFLA as it is known. UFLA has become one of the top coffee research universities in the world and one of the major forces behind that is Dr. Flávio Meira Borém. Here is a video of Dr. Borem discussing coffee processing at this year’s SCAA Symposium that they were kind enough to post on youtube [read more]
It’s harvest time here in Brazil; the culmination of the year’s work and the moment when growers can finally transfer this work into a product they can sell. But not matter how good the coffee is on the tree, all can be lost if the harvest is not carefully planned and managed. The Magalhães Paiva family has been growing coffee for 5 generations at Fazenda Recanto. We asked them to give us some essential things that must be done pre-harvest to ensure that the quality makes its way from the tree to the bean. [read more]