Ever had that “isn’t it payday yet?!” panic?
Or been left waiting on outstanding invoices for weeks on end, no matter how many (increasingly passive aggressive) emails you send?
Being paid for your hard work is something no-one likes to wait for. Especially when you’re living paycheck to paycheck as a result of low salaries, zero-hour contracts or - if you’re a coffee farmer - devastatingly low prices paid for the cherries you’ve grown.
The FNC: for the good of all Colombian coffee farmers
The FNC, or National Federation of Coffee Growers of Colombia, is the biggest association of coffee producers in Colombia - and one of the oldest, clocking in at 92 years old.
It’s both democratic (because coffee growers get to vote for their representatives), federal (with 16 committees across the country), linked with the Colombian government (the contract for which they re-establish every 10 years), and 100% private (owned by the coffee growers).
What does it do? Well, there’s a lot to that answer too.
They conduct world-leading research in coffee, like developing new disease-resistant strains. They run the Juan Valdez café chain, the profits of which go to the National Coffee Fund. They organise teams of agronomists to go to each and every farm, whether they work with the FNC or not, to provide much needed advice and technical suggestions. And they also legally have to buy coffee from any farmer who wants to sell to them.
FNC Purchasing Guarantee
Here’s how it works.
All coffee growers with 1 hectare of land or 1000+ plants have the right to a coffee grower’s ID. With this ID they can sell to any FNC warehouse - of which there are many, spread across Colombia. It doesn’t matter how much coffee they’re bringing, or what quality it is - the FNC have to buy it at that day’s market rate, with a differential applied (which depends on the quality of the coffee, its traceability, any certifications it has e.g. Fairtrade, Rainforest Alliance).
The price paid for their coffee is immediately transferred to their ID, which can then be transferred to their bank - so it also is accepted in most shops and restaurants, as a payment card in its own right. Their card also gives them the right to vote every four years for their local representatives!
Pact’s visit to a speciality-only buying warehouse: a step-by-step
This October, we visited a warehouse that deals only with speciality coffee - that’s coffee that scores at least 84 points when cupped by experts. Here’s how they do it:
- A farmer comes in with their lot of coffee, wanting to sell it. Great! Friday, Saturday and Sunday tend to be the busiest days - as the farmers have usually been working throughout the week
- At this particular warehouse, there’s a lab for cupping the coffee to determine its quality. That’s not the case everywhere, but here, that’s exactly what happens
- The lot of coffee brought in is weighed
- Next, the differential is determined. This is essentially working out how many kilos of parchment (farm-fresh dried beans) do you need to get 70kg of green coffee. That’s the beans with the papery top layer removed, and any damaged beans or twigs (for example) removed. This is done by taking out a 250g sample, seeing how much is left, and using that to create a factor - the average is 94kg
- Other factors are applied to determine the price too: coffees denoted ‘regional’ have more traceability to a particular place, so earn more than standard. And coffees with any certifications get more too
- Once the price owed is determined, it gets electronically transferred to the coffee grower’s ID (because they’d have to keep a lot of money on site otherwise)
- And that’s all done in 10-15 minutes!
No matter what the demand, or number of growers producing, or state of the market - Colombian coffee growers can always sell their coffee. And that’s largely thanks to the FNC.
Pact’s ‘extra’ payments
We’re lucky enough to have a very close relationship with the FNC - which we’re proud of, due to all the incredible work they do. By buying through them, we know the farmers we work with are never waiting on their base payment - and they get a back payment with the extra we pay, too!
That means immediate security and stability for them. But it also means they get a hefty check with the premium we’re paying at a later date - and sometimes we get to hand these out in person!
On the same October trip, we got to do this with the Asomuprisma members who had produced Micro-lots - and there is nothing better than seeing someone be rewarded for the hard work they’ve done.