international agro consulting ... Laos Highland Site Visit, Paksong November 16 to November 24, 2009 Paksong Highland Co., LTD

Transcription

1 Daniel Kuhn International Agro Consulting. P.O.Box 250 Kualapuu, Molokai Hawaii, USA international agro consulting Laos Highland Site Visit, Paksong November 16 to November 24, 2009 Paksong Highland Co., LTD

2 OBJECTIVE OF THE VISIT 1. Cupping Review of Prepared Coffee Samples to Chart Processing Directions 2. Plantation & Current Planting Review 3. Wet Mill & Dry Mill Review 4. Drying Area Review 5. Supervisors Training 6. Other Comments: The previous report Laos Highland Site Visit, Paksong &Pakse, from November 7, 2008 (IAC; Daniel Kuhn) should be reviewed in conjunction with this report. In regards to cupping, read Hand Harvest for Cupping Analysis (Oct. 09) The objectives of this visit could not all be met due to time restrictions however much was addressed. Last year showed great progress with the planting of hectares of coffee in the ground. Key decisions need to be made immediately, involving considerable capital expenditures, regarding wet & dry processing equipment, construction and drying location and installation. All photos by Daniel Kuhn, unless otherwise noted

3 ITINERARY OF MR DANIEL KHUN VISIT TO PAKSONG HIGHLAND, LAOS PDR 15-25/11/ 2009 Date Time Proposed Plan Place & Transportaion Sun 15/11/09 Depart from Hawaii To be arranged Mon 16/11/ hrs Arrive Bangkok 0100 hrs Check in hotel Novotel Airport Hotel, Bkk Tue 17/11/ hrs Arrive Paksong, Laos PDR hrs General Discussion hrs Field Inspection-Nong Hin and Kong Toon Plot 1800 hrs Check in hotel Phu Dhevada Resort Hotel, Paksong Cup test for all prepared samples Wed 18/11/ hrs includes 12hr, 24hr, 36hr fermentation hrs Field Inspection-None Kratad Plot and pruning practice Thr 19/11/ hrs hrs Technology and field inspection analysis Pest control and IPM Fertilizer application Weed control Soil and tissue sampling Coffee Mechanization and Harvesting Techniques Mechanization Plan Fri 20/11/09 Sat 21/11/09 Wet mill process, lay out and equipment include presentation of hrs suppliers hrs (continue) hrs Wet mill location evaluation Dry mill process, lay out and equipment include presentation of hrs suppliers hrs (continue) - 3 -

4 Coffee Logistics and Remaining Sun 22/11/ hrs Issues hrs Presentation preparation hrs Arrive Ubon Ratchathani hrs Arrive Bangkok By Thai Airways 2100 hrs Check in hotel To be arranged Mon 23/11/ hrs Presentation and report preparation hrs Presentation to Company Executives Visit coffee houses in Bangkok Tue 24/11/09 Leave for Hawaii To be arranged Wed 25/11/09 Arrive Hawaii Training Discussion for Coffee in Laos Nov.18 &19, Nov. 18. (need at least one day) Cup test samples for comparison. See: a. Proposed Planning for Nov. visit to Paksong b. Hand Harvest for Cupping Analysis c. Key to quality coffee and previous sample analysis (Mennon) d. SCAA cupping guide 2. Nov. 19. Coffee Physiology a. Flowering (induction, multiple flowerings) b. Overbearing c. Shade and sun d. Balancing inputs e. Quality objective 3. Pruning Practice a. Principles involved (no coffee on old wood) b. Limitations of size of operation (hand labor) c. Beaumont Fukunaga d. Molokai e. Kauai f. Equipment and suppliers - 4 -

5 4. Agronomy and Field Technology a. Pest control and IPM i. Nematodes, Stem Borer, Coffee Berry Borer, Green Scale (Ant control) ii. Rust, Coffee Berry Disease iii. Sanitation and control, Chemical and IPM iv. Equipment b. Fertilizer and Application i. Commercial, compost ii. Application, fertigation, granular, broadcast, side dress, foliar, slow release iii. equipment c. Soil and Tissue Sampling i. Desired levels of major and minor nutrients, soil and tissue ii. Tissue analysis, soil analysis, testing lab iii. Equipment 5. Mechanization Plan a. Concept and Planning, hand labor availability b. Equipment selection c. Where to buy 6. Harvesting a. Harvest Strategy, Quality Objective- multiple flowering b. Harvest distribution, Harvesting curve by month, Or,R,UR c. Single pass, multiple pass d. Type of machine to use, pull behind, self driven e. Equipment manufacturer f. Brazil, Kauai, Molokai, Australia g. How to handle OR, R, UR h. Transportation from field, Over row, trailers 7. Processing a. Siphon tank, washer, elevators b. OR,R,UR separation and processing c. Fermentation d. De-Mucilaging e. Pr Harvest distribution, Harvesting curve by month, Or,R,UR f. Pre-Drying g. Sun drying, mechanical drying h. Storage i. Dry Mill j. Grading and Standards k. Export and shipping 8. Suppliers review (strengths) Bendig (Costa Rica), Agromachine ( Brazil), Cimbria (Austria), Pinhalense (Brazil), Mc Kinnon (India), Palini Alves (Brazil), Oliver(USA) - 5 -

6 Points Not Addressed Harvest Strategy Harvest Machine Options Mechanization Plan Fertilizer and application Soil and Tissue Sampling Wet and Dry Mill Processing design and functions (except Pinhalense address) Treatment of processing water Supplier Review (strengths) Marketing and Roasting Points Addressed Cupping Analysis with view of wet and dry processing design Conservation and Drainage Plan Planting Modifications Transplanting versus direct seeding of pre-germinated seed J-root problems Die-Back of young plants Weeding problems of hoe Coffee Physiology Pruning Practices Agronomy and Field Technology Pest control and IPM Supervisor intervention in planting and maintenance tasks Need for filed inspection (scheduled and written) Windbreaks - 6 -

7 A. Key Decisions in Looking Ahead 1. Production Philosophy and Price To be or not to be.specialty Coffee or Commodity Coffee, Robusta or Arabica, or all of the above? Karnataka India has shifted from Arabica to Washed Robusta on account of production costs being 30% less, (reduced Stem Borer damage with Robusta) and their washed Robusta is almost equal in price to Arabica. Now there is 70% Robusta production as to 30% before. On the other hand, Kona Coffee in Hawaii is getting $10 to $12 per pound across the board for the region. Jamaica, Blue Mountain coffee pricing is similar. Last year, Esmeralda Farm in Panama has gotten $ 120 per pound for selective lots at a SCAA auction. It is clear that Specialty Coffee has its rewards. It will require more capital expenditures and it will take some time to develop and brand the product. In the end there will be a combination of all of the above coffees. The lower grades from the Specialty Coffee production will sell as Commodity Coffee. It is recommended to start a roasting program as soon as practical, as it can utilize the various grades in a better price fashion then green coffee only. Laos coffee is not known for its Specialty production. Laos coffee has been sold for commodity pricing, set at the New York Commodity Exchange. Laos coffee has typically been discounted from NYC price by 10 to 20%. Better producers get NYC price plus 10 to 20%. I am told that Dao Coffee has been getting $ 1.50 per lbs. this year which would indicate a NYC plus 10 %d to 15% which would be a good indicator of possible pricing. A goal for well produced and graded coffee should be similar to Kenya AA pricing, for around $ 1.90 to 2.20 per lbs. this would be a good initial goal. It is critical to have a Production Philosophy and put the necessary components in place and then adhere to the implementation of this philosophy. 2. Cupping Analysis Laos coffee as of recent, has not cupped in the 80 + range (needed for specialty classification). The coffee exhibits good body with lesser acidity. A balance of the two is necessary. The coffee is also described as lacking in any outstanding or significant traits. The recent cupping samples indicated better acidity with longer fermentation. This stands to reason as the temperature was on the cooler side, therefore taking longer for the fermentation process to complete. It is important to understand that the reason for the cupping analysis was not to determine the actual cupping score. The reason was to find the best way to process the coffee given the available options and select the best path from these options towards Specialty Coffee

8 It would be a nice surprise if the scores would come in the 80+ range. I don t think this will happen. This would not discourage me in having the goal of Specialty Coffee. The cupping scores will help however in determining the best avenue for processing towards Specialty Coffee. For example the Kauai plantation in Hawaii took several years to develop into a $ 5 to$ 8 per pound coffee producer. In time the coffee and especially the top grades evolved as Specialty Coffee with appropriate pricing. Specialty Coffee is a path and will likely not be developed over night nor with the first crop. It is strongly recommended that the different samples be sent to at least two or three US cuppers to confirm the findings form this trip. 3. Physical Set Up The whole coffee world is trying to produce specialty coffee on account of higher prices. Some producers can succeed others cannot as the processing set up is not allowing for good processing. Good processing is primarily separation of unwanted beans in the step by step processing until the final product. Quality therefore depends on the inherent quality of the growing beans however quality is also determined by the physical conditions of the beans (size and allowed defects per grade). It is critical to build a processing set up to allow for Specialty Coffee Production It is critical to develop a System for Grades and Standards for this coffee This is a chain with the weak link analogy. All aspects are important from the planting to growing to harvesting, processing to grades and standards to sales and marketing. Again, this will be a path and probably not everything will be together at the first harvest. Not everything in this report can be addressed again. The different issues were discussed on the trip and this is a short recap, touching on the highlights

9 B. Review of Key Issues Cupping Analysis with view of wet and dry processing design The cupping analysis has been discussed and the conclusion is that wet processing with longer fermentation produces the best cup. This finding is subject to review. 1. Wet Mill Design Mechanical harvesting will produce 3 types of coffee, Ripe (R, red or yellow), Over Ripe (OR, brown) and Under Ripe (UR, green). The percentage distribution is difficult to predict but it will have a larger percentage of under ripe on account of uneven flowering. Therefore good GREEN BEAN SEPERATION is critical. The best green bean separator (old style) is from Bendig SA in Costa Rica. This is a wire cage construction as opposed to a flat steel cylinder with slots cut out (Palini Alves and Pinhalense). Flat steel cut outs Green Bean Seperator by Palini Alves and Pinhalense. Not as effective as the wire type. Bendig, Green Bean Separator with a wire cage. Best proven old style Both these Green Bean Separators need a Skin Remover in conjunction. In essence the Green Bean Separator becomes the pulper and consecutively the skin has to be removed. This can be done in a vertical skin remover (Pulper) or a rubber breasted horizontal machine. The results are about the same and based on a rotating drum with knobs pulling out the skin from the pulped beans. There are new style machines that combine Pulper / Green Bean Separators and Skin Removers all in one. These newer machines use considerable less water and combine the 3 functions and give less damage to the good beans. These machines are now available from Agromachine. They are also constructed from stainless steel having more durability. Green bean separator above pulper drum, acting as skin remover. Old style used by Plalini Alves and Pinhalense. Not as effective as the Bendig machine. New combination Pulper, Green Bean Separator and Skin Remover. Made from stainless steel from Agromachine Brazil. Uses half the water of the other styles

10 ith UR green bean separation, a separate By-Pass Pulper needs to be installed for the UR green cherry. They can be sold as commodity coffee and are best processed pulped to speed up the drying process. Prior to green bean separation a pre-cleaner for stick and leaf removal and a washer (Pinhalense) to separate OR and remove stones is necessary. The Overripe Cherry after separated in the waterbath (by flotation) can be processed as a Natural coffee. The importance is to transport these separated OR to the drying ground ASAP (within 3 hrs). The use of a Pre-Drier for the OR is a consideration. It removes about 10% of the moisture and still requires quick transportation to the drying grounds. As Pre-Driers require considerable energy and still requires a quick transport it is better to transport the OR to the drying ground in a timely manner (every 3 hrs) without letting the OR sit around with moisture. They will deteriorate quickly; therefore they need to be transported to the drying ground ASAP. The additional separation of R cherry in the OR should be an option for later installation. The additional equipment needed with elevators and silos etc. is not worth the additional gain. The use of a wet criba is recommended. This will remove floaters after the pulping process and help with the classification and removal of secondary beans from the premier coffee. The rejects from the criba should be combined with the UR cherries. Washer to separate OR and rocks from R and UR (. Pinhalense ) Having an elevated terrain to allow for gravity would help with the processing. If necessary an elevation difference can be constructed with machinery which would help in the long run with the flow of processing and save energy and elevators. Wet Criba in Nicaragua producing excellent washed coffee. Roll On /Off dumpsters should be considered for all transports. Field to wet mill and wet mill to drying ground This would save on truck purchase Photo: Hometown Dumpster rental

11 2. Flow Chart in Wet Processing 1. Reception silos ( steep sides to facilitate flow, 35 to 45 degree, at least 15 cubic meters) 2. Belt conveyor for flow control 3. Pre-cleaner (shaker) 4. Washer ----remove OR and R&UR and stones (heavy objects) 5. Elevator 6. Silo (as buffer to regulate flow to pulpers) 7. Pulper / Green Bean Separator (UR green removal, Pulping and Skin removal) 8. Criba removed floaters go to green UR line 9. Fermentation 10. Demucilage 11. Transport to drying ground ( in a timely manner but not as critical as OR) OR; separation in Washer (#4) 12. Conveyor for OR direct to Truck / Trailer / Bin (needs to go to drying ground ASAP) 13. Transport to drying ground 14. Finish drying process in drier after patio (better quality finish and equalizes moisture) UR Green; separation in Pulper /Green Bean Separator / Skin Remover (#7) 15. Elevator 16. Silo (to allow flow control to By-Pas pulper) 17. Hard Bib Pulper (to speed up drying of green) 18. Elevator to silo or Truck / Trailer / Bin 19. Transport to drying ground 20. Conveyor / Elevator for pulp direct into Trailer / Bin 21. Transport to composting grounds In order to reduce the number of trucks, it is recommended to use trailers. This is more cumbersome in hooking up and unloading but would save driving time and energy. The other option is the use of Bins that can be self loaded onto trucks and deposited for filling in the various locations including the transportation of cherries from the fields. In general I would recommend securing equipment from the best available sources in terms of price, quality and transportation costs. It is unlikely to get all this from one manufacturer. I would recommend the use a designer with the knowledge of his different equipment and have them draw plans and help with equipment selection. For example, purchase special coffee equipment from Brazil or Central America and Silos and Buildings from Vietnam

12 3. Drying of Coffee The coffee to be dried has to be moved from Paksong (wet mill) to the drying grounds. The steps are as follows: 1. Receiving parchment and OR, Over-Ripe and UR, Under- ripe immature at the Drying Ground. 2. Spreading and raking of beans hourly (do not let temperature on top of drying parchment build up). Preferably need raking machine. 3. Dry to a moisture content of about 10.5%. The Hawaii grading allows moisture between 9% and 12.2 %. The higher the moisture the better the color in the beans, on the other hand the lower the moisture the better the storage capability. Depending on the storage time and the climate in the area coffee can be stored for some time, or it has to be milled and shipped sooner. If there are storage problems, fans can be installed in storage silos to help maintain given moisture content. 4. Pick up product from drying patio and move to drier and storage. A vacuum broom machine is available to mount on the tractor and trailer to pick up the dried coffee. 5. Parchment can be dried on the patio or finished in the drier (need to cost analyze patio and drying costs). Natural Dry coffee should be finished in the drier for better quality results. Immature UR and Robusta can be finished in the drier for quicker results. The question of whether or not to dry on the patio or to dry in the drier is a difficult question to answer. The cost of cement and the cost of construction have to be analyzed against the installation and maintenance costs of driers. The energy cost for drying is also a determining factor. For efficient drier operation a boiler with hot water distribution is recommended. The question is the energy source. Coal was mentioned as a cheaper energy source and can be used in a boiler. A boiler can also take wood logs (from the forest plantings in Paksong) or woodchips. Chips can be mechanized for feeding into the boiler. Logs can be used but need manual feeding. As there is lots of wood in the planted forest in Paksong this should be considered as an energy source. The use of logs is very easy to use in a boiler situation. The drying situation needs to be analyzed too and find the best and most cost effective solution. For the drying operation driers are necessary for the Naturals to obtain a better quality (3 to 4 days in the sun and approximately 24 to36 hrs in the drier). Finishing naturals in the drier gives a better quality product as it equalizes the moisture in the beans better then on the patio. The drying time is also considerably shorter

13 The parchment can be finished on the patio in 5 to 8 days. Depending on the quantity of parchment which arrives, it might have to be 2 days in the sun and finished in the drier (24 + hours). There is also Robusta and Immature UR to be dried, for this the drier is probably more cost effective. In Kona Hawaii, the old farmers recommended 3 days in the sun and finishing in the drier 16 to 20 hrs). The ultra violet light seems to have a very beneficial impact on the drying of coffee. Typically in many patio drying operations, the coffee is raked into a pile and covered at nights with plastic. In Hawaii moveable roofs are used to cover the coffee at night. The reason for covering is to keep the coffee from picking up moisture at night (dew). I am not sure about the night conditions in Pakse. I did not see any bunching up of coffee for the night at Dao coffee. If the nights are dry, then the time consuming bunching up for the night is not necessary. If night moisture is a problem, then finishing in the driers is better for the quality of the coffee. Getting drying coffee wet again, will diminish the coffee quality. Covering of parchment coffee for the night. Keeps out night moisture and helps equalizing moisture. Nicaragua Movable roofs in Hawaii. Easy closing at night. Can also be used to cover during the hottest time in the day to keep parchment form splitting open. The drying operation is critical for the preservation of coffee quality. This is the place where most quality problems originate. The thickness of the parchment layer is important. A thin layer (8 cm to 10cm) will speed up drying, but will increase the temperature to where the parchment can split open resulting in marbled color of the finished beans. A thicker layer maybe up to 18 cm may be considered to limit the build up of heat on the patio. With a thicker layer however the possible problem of molds is present. Frequent raking will be necessary. Raking needs to be done hourly. I the beginning when the parchment is wet the frequency needs to be increased. In the beginning the rake needs to be wider to allow the concrete

14 to dry up quickly. Once the surface moisture (between the parchment layer and the bean) has dried the rake should be changed to a narrower configuration. Problems in drying can result in the formation of Ochratoxins resulting from the formation of molds in the bean. The European Union the US and other countries have varied limits on Ochratoxin levels for importing coffee. The combination of thickness of parchment and the frequency of raking needs to be closely watched and adjusted to local temperature and climatic conditions. The parchment should dry evenly. Even drying will result in the desired greenish blue color of the finished bean. The coffee bean temperature during drying should not exceed 45 degree Celsius either on the patio or in the drier. When the drying time is over, the coffee needs to be stored for milling in the dry mill. Picking up the coffee from the patio is a labor intensive operation either to move it to the drier or to put it in storage. There is a tractor driven vacuum-brush machine that loads coffee into a trailer pulled by the tractor. The PTO of the tractor powers the vacuum-brush. This device could save considerable labor. 4. Storage and Dry Milling of Coffee Coffee should be stored in parchment or in the shell for Naturals until a sale is consummated. Milling should be done to order. Coffee can be stored in parchment or the shell for 6 to 12 months. The color might fade with age which can be a problem to pass grade if color is a grading requirement (which it should be). In the case of Naturals on Molokai Hawaii, the storage time needed to be 3 months to eliminate riory off flavors. Almost to the day after 3 months the quality improved. A series of silos for storage should be placed under a roof to minimize sun exposure. The size of the silos should be the volume to accommodate 4 driers which would be approximately kg. of parchment. Each drier or drier volume of coffee prior to loading into the silos should be cupped for quality analysis. Mixing bad coffee, with for example excessive black beans into one silo, will contaminate the rest of the silo s coffee. Therefore whatever is stored together needs to be of equal quality. Problem batches need to be combined and isolated so they can be milled separate. A decision has to be made as to how much storage is needed. If all coffee harvested and purchased needs to be stored, a large number of silos will be required. If milling and sales can start after the harvest then fewer silos are required. The supplier of the equipment or the Each silo should hold 4 drier volumes of coffee or about kg. Photo, Collision Co

15 design engineer needs to figure on the required storage requirements. Once the dried coffee is in the silo, it can rest and equalize moisture while waiting for milling. The method of loading the silos will depend on the equipment selected. Driving with wagons over a hopper will make loading easier. This will depend on what type of pick up equipment is selected to retrieve parchment from the patios. There is no need to condition the parchment coffee for two weeks in wood silos as the coffee can rest in the regular storage silos. There is some debate on how long the coffee should rest prior to milling. In Kona Hawaii the coffee is milled immediately after drying. In Nicaragua they prefer a one month rest period. In actuality a cupping analysis will give the answer on how long the coffee should rest. 5. Milling A major question has to be determined as to how many different milling lines are necessary to accommodate the different coffees. In general there is no need for different lines. Multiple lines are necessary to accommodate the milling in a timely manner. Since multiple lines are necessary (from a time point of view) it is recommended to separate Robusta lines so that coffee is not mixed in the milling process. The equipment sequence is however the same. This will also depend on the design engineer or the manufacturer. There is one difference as to milling parchment or naturals. Naturals and parchment should have a separate huller. This can be built into the milling line were a simple elevator drop will drop into each different huller and the rest of the line will remain the same for either coffee. Of course after milling naturals for example the line needs cleaning prior to milling parchment coffee. All the elevator bottoms etc need cleaning prior to milling parchment or naturals. Sequence: 1. De Stoner 2. Huller 3. Catador 4. Silo 5. Polisher 6. Seizer 7. Silos 8. Gravity table 9. Silo 10. Color Sorter ( depending on the quality of wet and dry milling a color sorter might only be needed for problem batches) 11. Blender for one container volume of coffee lbs 12. Silo 13. Scale and sewing machine

16 Depending on the design engineer and the manufacturer the various elevators and silos might differ in sequence. The interconnecting elevators and options will vary as well. The selection of the size of the shipping bags can vary. Brazil uses 135 lbs. bags. Central America 150 lbs bags. Hawaii 100 lbs. bags Australia 50 lbs. bags. My opinion is that 150 and 135 lbs are too heavy for a roaster to lift without two people. Therefore 100 lbs bags should be used as they can be handled by one person in the roasting operation. Bags need a responsibility statement, country of origin and grade markings. A tag is usually sewn into the closing bag with certification mark if applicable. The most sensitive machine in the dry mill is the gravity table as it is the tool where the actual grading takes place. My recommendation is to use a US Oliver table or a German Heid table. These tables are expensive but deliver superb classification and grading possibilities and minimize the need for color sorters (very expensive). The equipment selection will depend to a large degree on the design engineer and or the manufacturer. Oliver gravity table. US My recommendation is to use different manufacturers selected based on their strengths, quality and price of the equipment. The freight and installation costs should be considered as well. I would use driers and buildings and silos from Vietnam. Specialized coffee equipment I would purchase from Brazil or Central America. The gravity tables I would purchase from the US or Germany. Green coffee ready for shipment with tags sewed into it Green coffee bags with logo, responsibility statement and grade markings. Oliver table on Molokai Hawaii. Replaced a Brazilian copy with very good results

17 6. Grading Standards The Dry Mill has to remove the problems left from the fields and he wet mil. The coffee has to be milled and the defective beans have to be removed to comply with the grades and standards specified. The Dry Mill cannot operate effectively without a predetermined Grading System. A grading system has to be adopted. For specialty coffee production, the grading is stricter than for commodity coffee. Laos does not really have any grading system to deal with specialty coffee. Therefore the company has to adopt its own system. I would recommend a modified Hawaii system or the SCAA classification. A grade is comprised of a size requirement and allowed defects per grade. 6a. A simplified Hawaii Grading table: Grade Size Color Defects Allowed Requirement Kona Extra Fancy 19 yes 8 / 300gr. Full Defects (FD) Kona Fancy 18 yes 12 / 300gr FD Kona # yes 18 / 300gr FD Kona Select optional no 5% defects, not more than 2% Sour, Stinker, Black, Moldy Kona Prime optional, 15 less no 15% Def. (5% So,St,Bl,Mo) Hawaii #3 no size no 35% Def. (5% So,St,Bl,Mo) Off Grade no size no Not specified (special markings) Moisture allowed 9% % In addition to Grades, Hawaii has also a Certificate of Origin specifying the region where the coffee is grown. This certificate is Trademarked and helps in the possible fraud of mixing different origins that have different and higher pricing

18 6b. A possible Laos Grading System: Grade Size Color Defects Allowed Requirement Laos Extra Fancy 19 yes 10 / 300gr. Full Defects (FD) Laos Fancy 18 yes 15 / 300gr FD Laos # yes 20 / 300gr FD Laos #2 optional, 15 less no 15% Def. (5% So,St,Bl,Mo) Laos #3 no size no 35% Def. (5% So,St,Bl,Mo) Off Grade no size no Not specified (special markings) Moisture allowed 9% % for all grades Color requirement means, good greenish uniform color Roast quality has to be Excellent for grades EF, F and Good for grade #1 Roast quality for grades #2 and #3 does not allow for off flavors Peaberry is separated and has grading based on size and defects Triangular beans are not classified and are ignored, unless they have a defect The lowest common denominator applies. If you have size 19, and less then 10 defects but no color then you can only grade as #2 because that grade does not have a color requirement. Defects have to be predetermined, for example: 5 broken beans 1 full defect 1 black one full defect, 1 sour one full defect etc. It would be advisable to have a Certificate of Origin for Laos coffee as well. This would have to be issued by the Export Association or the State to be meaningful. This is extra paperwork but might be worth the trouble, especially in the long run. The Seizer will grade to size and the Gravity Table will remove the defects to the specified tolerance. If there are still defects then a color sorter is needed, which is very expensive. In Central America with excellent wet mills there is no need for color sorters. In Kona Hawaii there are no color sorters in use, based on excellent hand harvesting and good wet milling (very few exceptions). On Molokai Hawaii a color sorter was used for the low grades only. If there are too many black and brown beans in the lower grades then a color sorter is the only alternative for a final clean up

19 C. Field Issues 1. Direct Seeding of Coffee in the Nursery The objective is to preserve the tap root. Transplanting from a seedbed into planting bags has two times the exposure to break or damage the emerging tap root. Removing the seedling from the seedbed and planting the seedling into bags. A better alternative is to pre-germinate the seed in a warm environment and then plant into the seedling bags. The seed has to be covered very lightly so as not to inhibit the emergence of the first two leaves. If seeds are too deep they break upon emergence or can not come up. Because the seed is planted very shallow it is important to check for available moisture and don t let the top of the seedling bag dry up. An automated sprinkler system or misting system is advisable. In addition straw mulch can be placed on top of the bags to conserve moisture. This mulch has to be removed when the first leaves emerge. Conditioning for the light conditions of the fields is essential as well. If seedlings are grown in low light and then are transplanted into high light conditions of the fields sunburn of the leaves will occur and the plant is set back. Depending on the light differences between the nursery and the field condition the plant has to be grown in full light (for two leaf pairs) prior to transplanting. This can be done by removing the shade or transport the plants into full light prior to planting. When plants are very tight in the seedling beds the leaves will shade out each other again resulting in sunburn upon transplanting. It is strongly recommended to direct seed pre-germinated seeds into seedling bags taking into consideration the above points of caution.. Direct seeded seedling bags in full light in Nicaragua. Cloud cover and some shade make sunburn unlikely. Excellent roots from seedling bags. No j-root. 6 leaf stage for transplanting

20 Superior seedling from dibble tubes instead of seedling bags. No j-root is possible. The tight root structure makes planning with a planter much easier. Transplanters can plant through plastic mulch. Direct seeded seedling bags. Note mulch cover in the back of the picture. Needs to be removed when leaves emerge. Dibble Tube a reusable container will air-prune the roots on the bottom of the container and prevents any formation of j-root or circling of the roots on the bottom of the container. Seed too much advanced for transplanting Pre-germinated seed that is good for transplanting

21 Importance of shallow planting and cover with good soil or compost. Cover bag with mulch to prevent drying out. It is best to have automated misting system. Check regular. The temperature was low in Paksong. Therefore any protection from the cold would speed up growing. 2. Planting of Coffee in the Field This has been discussed in details on the trip. Some additional comments: The planting through plastic mulch has many advantages. Without drip irrigation under the plastic it is absolutely essential that the plants are firmly pressed into the soil to allow for water to transfer to the roots readily. If plants are not firm in the ground then they are insulated and subject to drying out. The pressure applied needs to be with fingers below the surface to insure contact below. Tapping down from the top is not a good idea as it will put pressure in the wrong place. Transplanting without drip irrigation needs to commence with the rains. The plastic needs to be narrow to allow moisture to the roots maybe 10 inches wide on top. The plastic mulch laying machine needs to be adjusted well, otherwise the wind will rip the plastic from the ground. The planning trial conducted did not have the plastic machine adjusted at optimum. There are plastic machines without a rotovator in front which will do a better job in laying of the plastic. They have a furrow disc that opens the ground to lay the plastic inside. Then they have a press wheel and a covering disc. The rotovator mulch layer will work however if adjusted properly. The existing ripper can be lengthened if hooked up in the back of the 3 point frame Coffee plants 20 months after transplanting. These were planted through plastic mulch. The sudax windbreak is in background. Sudax seeded with grain drill machine, with double rows 10 inches apart. It is recommended to use plastic mulch for the planting operation. Mulch will reduce the need for hand weeding and consequently reduce damage to the trees with the hoe. If a hoe is used it should have a rectangular blade to control the edge of the hoe and not damage the trunk of the coffee

22 Repeated weeding has hollowed out the planting line and now the plants are in a depression which accumulates rain water. If the plants are elevated the water will drain to the side which is more desirable. If plastic mulch is not desirable mulching around the plants with straw is possible. The use of pre-emergence herbicide such as Goal would be advisable to eliminate or reduce hand weeding. In the case of plastic mulch hand weeding is practically eliminated if combined with Goal spraying along the plastic and around the planting hole. 3. Sequence to planting with plastic mulch: 1. Mark planting line 2. Rip as deep as possible with single shank ripper. With existing John Deer tractor 47 is possible 3. Rip planting line with harrow to expose rocks. Remove. 4. Amend rip line with pre-plant fertilizer, calcium and magnesium if necessary 5. Rotovate planting line 6. Mark planting line to make sure to be over the rip line with plastic 7. Lay plastic. Top maybe 10 inches wide 8. Plant through plastic making sure to press seedlings with fingers into soil 9. Cover planting holes and plastic around hole with soil to prevent flapping 10. Spray Goal along plastic edges 6 to 12 inches wide, at same time spray planting hole Rotovate and mark again, so that plastic is over the rip line Rip planting line after marking. Follow with harrow to expose rocks Drop pre-plant fertilizer into rip line

23 Lay plastic and check on spacing between planting lines Plant the coffee and press well into the soil with fingers below the surface. The planted coffee in the picture looks spindly indicating low light while in the nursery. It is recommended to remove the shade for the last two leaves to expose the plants to the regular sunlight. Otherwise sunburn will likely result and setting the plant back. Whether or not the plant will sunburn depends on the light difference between the nursery and the light in the field. Also plants that are very close together in the nursery tend to shade each other out resulting in soft and spindly leaves. In Paksong the light conditions are often cloudy and overcast. If the light in the field is not too much different from the light in the nursery, then sunburn is less likely to occur. This can easily be answered with a test planting of nursery plants direct from the nursery and a set of plants that were grown in full light prior to planting. Sunburn on coffee seedling that was not conditioned to the light of the field. The two pairs of leaves should be grown in full light

24 4. Maintenance Tasks The planted coffee is the foundation of the whole enterprise. If the coffee plants are damaged during planting or weeding, these small plans will not deliver the expected returns in the future. Planting by the piece work should be reconsidered in favor of pay by the hour for certain critical tasks such as planting. Planting should be done carefully and with attention to details Fertilizer can not be put in clumps into the planting hole otherwise the plants will die due to excessive salt build up. Plants that were planted last year seem on the small side. High rainfall and water-logging could be a problem Weeding needs review and change of hoe. Use of plastic mulch should eliminate most weeding The clumping of fertilizer below plant. Fertilizer not mixed with the soil. This will result in burning of the plant Weeding with the hoe creates a depression for the water to accumulate. The topography needs to be the other way around. The plants need to be on top Damage to stem from triangular hoe. Triangular hoe does not allow control of the edge under the soil. Need to change to rectangular hoe to have a visual edge

25 5. Conservation Plan There are some lacking elements for a conservation plan. Drainage should be channeled along waterways that flow along natural drainage. Such waterways should be grassed and not planted. The planting lines of the coffee can continue in a straight line with leaving the waterway unplanted. Waterways should end up in drainage channels that are grassed as well to prevent erosion. If there are low spots that cannot drain, a pond should be dug where water can accumulate. Such ponds might have to be pumped out if they fill too much. Rocks should be removed prior to planting. Better field preparation should be done prior to planting either in strips or the whole field should be disked and leveled. The space between coffee lines needs to be nice and level otherwise harvesting machines will have a difficult time. The speed of planting should be tailored to field preparation. Temporary windbreaks should be considered such as sudax grass (every 3 lines to start with). If windbreaks are used they should b e seeded prior to planting of the coffee. A soil and water conservation engineer should design such a plan. Grassed waterway through field. Broad shouldered terraces are in the field as well but not visible. The size of the waterway depends on the drainage area. Road will be grassed and serves as drainage area as well. It is probably to wet in Pakson to use the road as drainage. In that case a separate drain is necessary

26 In Paksong it might be too wet in the rainy season to use the road as a drainage area. In that case separate drainage ways need to be established. They should be grassed in and sized for the amount of water to be channeled. Erosion should be avoided. In order to have a good drainage system in place a professional Soil and Water Conservation engineer should be consulted to draw and layout the conservation plan. Temporary windbreaks should be used due to wind damage. In Hawaii sudax grass is used successfully. Sudax is a sterile hybrid and will not make viable seed. It is typically seeded with a corn planter with small seed plates for sudax seeds. Two rows are seeded 10 to 12 inches apart with tee tape in the middle in dry areas. In Paksong no irrigation is needed. Some field preparation needs to be done for the planter to work properly. Every other or third row should be seeded. 5. Mechanization Plan In my view it is essential to have a good mechanization plan. This should have been in place before field planting to allow for more efficient maintenance work. The area is too large to relay on hand labor. Machine work can do much of the maintenance. Of concern is the rainfall during the year. June and July have 800 mm and 900 mm of rain with a total of 3600 mm per year. On Molokai we had 800 mm for the whole year. This amount of rain will make the use of machinery more difficult. On the other hand there is light equipment available that can deal with rain. Most farm equipment seems available in Thailand. Some specialized farming equipment might have to be imported. As an example most of the tractors on the farm now will have to be changed to orchard tractors as the present wheel base is too wide to fit between the established coffee rows. I have offered my services in the past in regards to formulating a mechanization plan. In such a plan, transportation of the crop and harvesting in general needs to be included. Hawaii and Australia are in the forefront of coffee mechanization as labor costs are too high (10-15$ US hr.) for hand labor. 8 foot wide mower which will allow one pass between coffee rows. Now two passes are necessary as the mowers are 5 ft wide. The second pass is partially wasted. Orchard tractor with narrow wheel base. Grape orchard

27 6. Harvesting and Harvesting Strategy Harvesting is not just driving a machine over the coffee rows. Fast, slow, aggressive, multiple passes, etc. When should one enter a field and what % of ripe over ripe and under ripe is acceptable in the harvesting operation. The fundamental consideration is the retrieval goal of red beans. In a multiple flowering situation this is not easy as ripe coffee berries do not release a lot easier than an unripe coffee berry. The fruit removal force for ripe versus unripe coffee is to one. In blue berries it is 6 to one. It is easier to retrieve red cherry even with multiple flowering if one makes repeated passes with the harvest machine. This means more machines per hectare however. At a price of $ US to $ per machine this is an expensive proposition. On the other hand making only one pass with fewer machines will require to knock off all berries at this one pass, with the result of 40 % to 50% under-ripe cherries harvested. Under- ripe or green cherries have not much value. One account of the coffee berry borer all cherries should be removed at the end of the season in any case so as not to invest next years crop form the onset. Harvesting machines are available from the US, Australia or Brazil. Freight will be a big factor as the machines are oversized and cannot fit into a dry rack. There is a possibility of negotiating a license agreement and build the machines in Thailand or arranging for the purchase of a knocked down machine with assembly in Thailand. This issue needs research as at least 20 harvesting machines are necessary or more pending on the harvest strategy. The question will be one pass or multiple passes for the harvesting machines. A possible alternative is a combination hand and machine harvesting. Allot will depend on the flowering patterns of the coffee. All indications are for multiple flowerings related to the heavy rainfall in the Boloven Plateau which makes machine harvesting more difficult. Typically, in Brazil a mechanized harvest using machines at the peak of the harvest with hand harvesting prior and after the peak requires one machine per 500 acres. In Kauai, Hawaii a one pass system requires one machine per 250 to 300 acres. On Molokai Hawaii for a multiple pass (3-4 passes) requires one machine per 100 acres. For Laos the requirements are around 10 to 25 machines pending on the actual situation and on the type of harvesting strategy selected. Hawaii is currently engaging research into molecular flowering control. Flowering control related to dry weather with irrigation after a dry stress period is a known way of controlling flowering. This method will not work in the Boloven Plateau as there is too much rainfall and not a real dry period prior to the main flowering period. Molecular flowering control will possibly help in flowering control irregardless of the rainfall patterns. This research will take some time however to show results. Transporting the beans from the field to the wet processing plant will require some considerations. In Brazil they often use an over the row conveyor moving beans from the harvester to a tractor trailer moving along in the next row. This system can unload without waiting for access roads. This requires on harvester and two trailers pulled by a tractor. Positioning roll off bins in strategic locations will allow the tractor to unload into these bins

28 That is picked up by trucks on regular bases. This will reduce the number of trucks required but requires appropriate bins. The same bin system can be used to transport wet parchment, over ripe beans etc. from the wet mill to the drying grounds. These questions could be answered by a mechanization plan. 14 Korvan machines on Kauai. The shaker mechanism is aggressive with heavy counter weights Austoff machine made in Australia. Cabin is located to one side, which makes driving more difficult. Brazil has adopted this machine and fabricates under Brastoff. Harvesting machine made in Australia. It is an excellent machine that could be built in Thailand under license. Home made machine by a farmer in Australia. Machine made from used parts. The question of machine harvesting and the best way to deploy the machines is a complex issue. If at all possible easing into the situation would be best, avoiding costly mistakes. The quantity of planted coffee coming on for harvesting will require some hard decisions soon. Research into how to best purchase and how to deploy the harvesting machines should start ASAP

29 D. Handling and Treatment of Processing Water The first step is to use little processing water by using machinery that can function with little water. Water for the transport of coffee beans can be recycled. Full fermentation will require water for fermentation and washing. This water needs treatment prior the reuse or release. The pollution of natural water bodies is not acceptable. Liquid waste can be filtered prior to treatment and solids can be composted with the pulp removed during pulping. Coffee pulp is high in Potassium and makes very good compost especially if mixed with the parchment from dry milling. The liquid waste is evaluated by odor, color, ph, (BOD) Biological Oxygen Demand, and total suspended solids. Coffee wash water has high concentrations of these components. Treatment involves the use of: Use low water processing equipment Removal of solids form liquids Collect liquid in a central equalizing tank Removal of settling solids Chemical treatment Anaerobic Lagoon Aerobic Lagoon Aeration equipment to oxidize water in treatment The Indian coffee Board has extensive recommendations to the treatment of waste water. Hawaii currently has a complete chemical treatment option which makes lagoons unnecessary. This issue needs further research into the best cost effective solution. D. Sales and Marketing Identity development should start ASAP. Name and logo becomes important. In my last report I suggested some names. The name needs to work with green and roasted coffee. Branding is expensive and takes time; therefore the name has to be working for green coffee as well as roasted coffee. Focus Group In order to develop branding items, the use of a Focus Group can be very helpful. Focus Groups give immediate feedback and help select the best alternatives from a consumer point of view. A focus group is a random group of female and male consumers that voice their opinion on various marketing issues. This allows marketing decisions to be made form the consumer point

30 of view and not the other way around. The question of name selection, the question of logo and other important branding issues can be evaluated from a consumer point of view in a very quick manner. I have seen the company advertisement publication titled Pakong Highland- Laos Coffee Paradise. I don t want to express my opinion too much, except it goes against practically everything I would do. There is no point in me pointing out my preferences except to say you should have a professional graphic artist work up some alternative concepts and present them to a Focus Group for comments and then decide how to proceed. There is a great investment in a name and it should be the best it can be. What I see does not go in that direction. I have been involved in the branding of coffee for more then 20 years. This does not make me an expert on the subject, but I have learned a few basic principles that I would strongly suggest for you to use. It is important to select a symbol and name that is unique to Laos and or Thailand. This symbol or name or logo should have international appeal. I know now where Paksong is, but most people I talk to have no clue where Paksong is. Laos is known and of course Thailand is known. A volcano can be from anywhere and does not identify with Laos or Thailand. Your name or logo should identify with the origin in an appealing universal way. Your market has to be international as the production will be too great for a regional market. Conclusion The coffee business is complex. Most producers either grow or move their coffee to a cooperative for processing and sales (Brazil, Columbia etc.). Most growers do not concern themselves with cupping as this is someone else s business. Sales and marketing again are someone else s business. Storage, processing, freight and transportation are the business of the cooperative or the national federation or association. To be involved from A to Z in the coffee business and have it all functioning within a few years is a gigantic undertaking. The largest coffee farm in the world is either Tata in India with about 8000 ha (not sure how much is planted in coffee) and Ipanema in Brazil with 3500 ha + in coffee and Daterra in Brazil with ha. Kauai Coffee in Hawaii has 1300 ha. in coffee. All these growers took years to develop the growing part and the sales and marketing part took longer. To create a successful fully integrated operation is a large challenge. To remember is that, the largest coffee businesses in the world are processors and sellers not growers. They are for example Nestle, Sara Lee, Kraft, etc. It is cheaper to buy good advice than learn the hard way, which is usually more expensive