The Independent Voice
May 2020
“Best Agricultural Newsletter in Hawaii”
Newsletter of the Kona Coffee Farmers Association
PO Box 5436 Kailua Kona Hawaii 96745 USA
www.konacoffeefarmers.org info@konacoffeefarmers.org
Contents
Message from Colehour
Angst in the Time of COVID-19
A Green New Deal for Hawai`i
COVID-19 Resource Guide
Sell your Coffee to USDA
Time to Fertilize
Pesticide Safety Webinar Series
40 uses of Coffee Grounds
Supporting Business Member
Recipe: Kona Coffee Banana Pie
Editor – Clare Wilson
Message from Colehour
Aloha and greetings to all of you out there!
My sincere hopes that everyone has established, and is maintaining safe and respectful behaviors for yourself and community wellbeing, as we meander through these unique times.
Please remain broadly respectful, and more so, remember that the KCFA is here for you in order to address any of your Kona coffee concerns or needs. Reach out to us, and together we can work to keep Kona safe and healthy.
In that regard, leadership is already communicating to coordinate with District 5 House Representative, Dr. Richard Creagan, a virologist, who is working with the community to eliminate coronavirus from Hawaii Island, and other outer islands, as a starting point for elimination from Hawaii. This is great news, and we will continue to work together; please watch for upcoming specifics for coffee farmer members to help with this team approach that will be a relief for us all.
— Colehour Bondera, President
Angst in the Time of COVID-19
I have been worrying how COVID-19 will affect this coffee season. I asked KCFA about this and was invited to write up my own thoughts. My thinking has focused on demand, price, and labor. I did a bit of research and the following is some of what I’ve learned about topics I found relevant/interesting. My primary source was the internet and I read many articles. I also used reference books and spoke with some farmers and experts in the field. I did not use footnotes throughout but, I did provide many of my resources at the end.
As you know, the COVID-19 crisis forced millions of people to stay at home and most coffee shops around the world have closed their doors to the public. As a result, the sale of brewed, roasted, and green coffee have been affected. American agriculture overall has been hit hard by the shutdown. Locally, in a recent StarAdvertisor, the director of HDOA said “some farmers reported losing 50% to 60% of their market last month largely because of hotel and restaurant shutdowns.” I imagine that KCFA members are affected differently depending on whether they sell cherry, estate, or wholesale. Most members have small farms and we won’t be affected by changes for several months.
Governor Ige shut down the state to visitors in March and tourism has virtually stopped. Southwest has no flights scheduled until June. Hawaiian Airlines is still flying but canceling trips through mid May. So, there is a continuing risk of no local market demand or low increases in demand as the state slowly reopens. However, I believe the future should be much better.
I think the commodities market reflects much uncertainty. The wholesale market has crashed and roasters have an excess of inventory, similar to the oil industry, due to store closures. On the other hand, some retail sales have shifted to online purchases. In the beginning of the crisis, there was a tick up in sales due to hoarding but that demand will stabilize once the unemployment level starts to decline and people feel safe enough to go out. Farmers who have built good relationships with retail customers and have a good website are likely to have some cash flow at this time. Farmers thinking about trying online sales may find this a good business strategy going forward.
There is actually a relationship between GDP (gross domestic product) and coffee sales where a 1% increase in GDP brings a .95% increase in coffee sales. If GDP decreases, the relationship holds for a slight decline but as GDP declines beyond 1%, coffee sales decline more. GDP in the second quarter was -12%. I have seen some forecasts for 5% growth in the fourth quarter and 7% in 2021, which would at least maintain current pricing. I doubt the forecasts included the possibility of a second surge of COVID-19 in the fall.
During the SARS outbreak in 2003 and the financial crash in 2007-2008, prices plunged so a repeat now shouldn’t be a surprise. Coffee prices on the commodities exchange have been lower and volatile, but forward contracts imply an 8.8% increase in prices later in the year. Although the commodity exchange doesn’t really bear a strong relationship to specialty coffee prices, it does serve as a beginning point of sorts. Future pricing may also be affected by inflation given the amount of money that has been injected into the economy. This makes the dollar weaker and a weak dollar makes it harder to sell into overseas markets.
Oil prices are expected to continue to be low until excess inventory can be sold. Don’t let what you hear about the negative pricing in futures market cause alarm. Negative forward prices probably won’t affect the pump but rather industries that use petroleum. One of the most important uses of petroleum is in the production of ammonia to be used as the nitrogen source in agricultural fertilizers. Pesticides are almost all produced from oil. Plastic and packaging utilize petroleum. If prices remain low, it’s possible that we will see shortages in oil dependent products. Shortages usually mean higher prices.
Farmers take the brunt of changes further up the supply chain. Tight cash flows reduce purchases, and the expectation is for lower demand in the second and third quarters. All the uncertainty may even cause lenders to call loans or increase rates. But, there is some hope of assistance for small farmers in the latest funding bill. There are many funding and SBA programs other than PPP and Sen. Schatz’s website has a great deal of valuable information on the government programs. One program helps offset losses greater than 5% but that isn’t useful to many of us until later in the year. Crop insurance won’t cover losses related to a lack of labor, trade wars, or quarantines. I recently read that Sen. Hirono and Rep. Gabbard have requested additional funds for specialty crops, but I think Congress is growing tired of rescue bills.
My conclusion is that demand may increase moderately the rest of 2020 as we recover from COVID-19 and then continue to grow 2-3% in 2021 as tourists return. Prices will be about the same or somewhat higher due to inflation and increased input costs. Continuing to push for the 51% legislation seems critical for our ability to ultimately increase pricing to reflect true costs and a relevant quality premium.
The main issue I am concerned about is labor. Farm labor availability is a big problem. Last season was challenging and I think this year will be hugely problematic.
Before the crisis bloomed, visa application processing was running months behind and the State Department had decided to forego the interview portion for new applicants. My understanding is that Sen. Hirono has asked for an ag exemption from the 60 day freeze on immigration and that may be addressed in the next bill. However, I wonder if any attempts to help will be timely or truly helpful.
Foreign workers are also concerned for their safety in coming to the US since COVID-19 is still rampaging. They would also have to abide by the many COVID related rules. (I’ve attached a copy of a checklist from UC Davis about safe practices for farm workers in the age of COVID-19.) I think workers are also concerned about being stopped for being out. A “Safe Passage Letter” is recommended to be given to each worker. The Kona Police Department confirmed that this would be helpful for them. I imagine the immigration process and health concerns make it too much of a hassle for some foreign laborers.
I paid pickers more per pound last year and I suspect that local workers may be able to command even higher pay this year given a shortage. Obviously, that wage increase would need to be offset by lowering other expenses or making a profit will be even more difficult.
To conclude, I think prices will start out even with last year or a little lower and then increase through the season as demand picks up and the economy recovers. Costs will be higher and some crops may be lost simply because there is no one to harvest it. Ironically, less Kona coffee would increase prices.
I think all of us are craving more information and trying to plan accordingly so, please, if you have thoughts or questions to share, please write to the newsletter editor clare@huahuafarm.com
Resources (click on links below to view)
- Specialty Coffee Association (SCA) Community-Contributed database of resources, including sources relevant for all roles in coffee.
- Novel Coronavirus & Coffee: Resources and FAQs collected by the National Coffee Association (NCA).
- Supply Chain & Logistics updates in countries monitored by Sucafina
- Impact of COVID-19 on the Global Coffee Sector: the Demand Side. ICO Coffee Break Series
- How COVID-19 is Affecting Coffee Importers, In Their Own Words. April 2020 compilation in Sprudge.
I also appreciate the time given to me by some KCFA members and others to talk story.
NB-The COVID-19 Agricultural Worksite Checklist may be found here
–Submitted by Carolyn Witcover
A Green New Deal for Hawai`i
Just Transition Hawaii Coalition has produced this open letter to our state government suggesting that our post-pandemic economy include a Green Farming Revolution leading to food security for our islands.
To Rebuild the Economy, Focus On A Hawaii-Grown Infrastructure.
An open letter to the Governor and LG, the federal delegation, legislators, mayors and councils.
https://www.civilbeat.org/
“The Hawaii House of Representatives Select Committee on COVID-19 Economic and Financial Preparedness has announced that it has been holding briefings with business, government, nonprofit, and labor leaders for several weeks to plan for a post-coronavirus economy in Hawaii.”
“We, the undersigned, request that Resolution 54’s economic task force make the Green New Deal central to its strategic plan. We also request that the task force and its Special Committee include regenerative farmers, indigenous groups, zero-waste experts, and members of the Democratic Party of Hawaii Green New Deal Working Group.”
The steering committee of Just Transition Hawaii Coalition welcomes more farmers to become part of the coalition. This is a partnership between farmers, labor, native Hawaiian groups and other working people to form a broad coalition for a just transition to an economy that works for everyone. It costs nothing to join, other than lending your voice to say you stand for a Just Transition. This is the people power that is needed to make real, long-lasting change. To join, please email your name, the name of your farm (if any), and what community you live in, to koohanpaik@gmail.com.
–Submitted by Chet Gardiner
COVID-19 Resource Guide from Senator Hirono
Attached you will find a resource guide (updated as of April 27th) for Hawaii’s Ag Industry. click here
Recognizing that Hawaii’s ag producers are not only farmers, but businesses, homeowners, and employers, we wanted to provide a guide that could serve as a one-stop-shop for available federal relief. In it you will find information about USDA’s Coronavirus Food Assistance Program (CFAP), SBA Programs (both PPP and EIDL/EEIG), Residential Mortgage Provisions, and Federal Tax Provisions.
As programs are dynamic and details are subject to change, this guide provides links to websites where you can access up-to-date information from the relevant federal agencies.
Please let us know if you have any questions and feel free to share with folks that would find this helpful.
From Jen Burks
Senator Mazie Hirono’s Office
Sell your Coffee to USDA
COVID-19 has caused coffee sales to slow or halt for many businesses. Synergistic Hawaii Agricultural Council has been in conversation with USDA to facilitate purchases of Hawaiian-grown products for government use. If you have roasted coffee that you would like to make eligible for USDA purchase, please contact suzanne@shachawaii.org as soon as possible. Be sure to include the total quantity you would like to make available, the packaging format (i.e. bag, pods, commercial packs), and the requested price. All information will be kept confidential.
From Representative Nicole Lowen’s Office
Throw that Fertilizer Now!
If you haven’t already- Time to Fertilize. Ground is nice and wet and ready to absorb.
FYI- the series of numbers on the bag refer to the percentage of (N) Nitrogen-(P) Phosphorus-(K) Potassium in the mixture.
Fertilizer marked for example, 11-5-25 or 10-5-20 is specifically formulated for our coffee and has added minor elements- all essential for healthy growth. If the middle number in the formula -phosphorous- is too high (recommended is 5%), beware, the phosphorous will eventually bind and accumulate in the soil and over time will become toxic. That’s why the recommendation for (P) Phosphorous is 5%.
Q: My coffee trees are yellow even though I have fertilized them. Help!
A: How much fertilizer are you using? A single coffee tree needs about a POUND of fertilizer per tree twice, not a simple handful. The fertilizer needs to be scattered broadly around the entire circumference of the tree-out to the edge of the leaves. A healthy tree is a green tree.
Addendum: The tree could be unhealthy due to circumstances beyond your control; for instance, it could be growing on a rock, it could have a poorly developed root system or it could be growing in a poorly drained area etc.
–Submitted by Cecelia Smith
Pesticide Safety Webinar Series
AgSafe is excited to offer a four-part pesticide safety webinar series for a small fee. Each live webinar has been approved by HDOA for 1.0 continuing education units. If you, your family members or your workers spray Botanigard/Mycotrol/Roundup or any other chemical then you are REQUIRED to follow the Worker Protection Standard.
Courses will be held:
May 11, 2020
Intro to the Worker Protection Standard & Hawaii Requirements
Hawaii Department of Agriculture CEU Course 3132
9:00 AM – 10:00 AM (HST)
English Only
May 18, 2020
Determining Your WPS Employer Responsibilities
Hawaii Department of Agriculture CEU Course 3133
12:00 PM – 1:00 PM (HST)
English Only
June 1, 2020
WPS Worker and Employer Requirements
Hawaii Department of Agriculture CEU Course 3134
9:00 AM – 10:00 AM (HST)
English Only
June 8, 2020
WPS Handler and Employer Requirements
Hawaii Department of Agriculture CEU Course 3135
12:00 PM – 1:00 PM (HST)
English Only
The cost is $20 per webinar or $70 for the entire series. To register and for more details, visit https://www.agsafe.org/hawaii-
We look forward to your participation!
Amy Wolfe, MPPA, CFRE
President and CEO Emeritus
AgSafe
40 Uses of Coffee Grounds
This article has an amazing list of 40 uses for coffee grounds, several we have noted before. My favorite in this list is how to make espresso powder. Many recipes that use coffee call for ground espresso.
https://practicalselfreliance.
–Submitted by Clare Wilson
Supporting Business Member – Coffee & Tea Ltd.
About Coffee & Tea Limited– We are a local coffee roaster and tea importer located in the heart of Linden Hills in Minneapolis, Minnesota. Our operation is family owned since the 1970’s. We offer a variety of fresh roasted coffee and loose leaf tea, sourced from over 60 producing countries. It’s a convenient spot to pick up fresh beans, loose tea, or a custom brewed cup of coffee or tea.
www.coffeeandtealtd.com
2730 West 43rd Street
Minneapolis, MN 55410
(612) 920-6344
***Please support our Business Members as they support us.
Recipe – Kona Coffee Banana Pie
Macadamia Nut Crust
¼ cup macadamia nuts
1 cup graham cracker crumbs
¼ cup sugar
¼ cup melted butter
Combine ingredients in a food processor. Press into a 9” pie pan. Bake at 375 deg. for 10 minutes. Cool
Filling
¾ cup sugar
5 tbsp flour
¼ tsp salt
1 cup Kona coffee
1 cup evaporated milk
1 egg, beaten
1 tsp vanilla
3 bananas
Stir together sugar, flour and salt in a saucepan. Add coffee and evaporated milk. Bring to a gentle boil, stirring frequently until mixture begins to thicken. Beat egg, milk and vanilla together in a bowl. Add ¼ cup of the hot mixture to the bowl, stirring constantly. Add egg mixture to the pan over low heat and stir until mixture thickens. Remove from heat and cool.
Slice 1 banana on the pie crust. Pour in half of cooled pudding, top with another sliced banana, and the rest of the pudding. Slice the last banana on top and spread with whipped cream topping.
Whipped Cream Topping
1 cup heavy cream
½ cup powdered sugar
1 tsp espresso powder
¼ cup chopped macadamia nuts
Whip cream. Add sugar and coffee. Spread on pie and sprinkle with nuts.
Recipes Wanted! If any of you have coffee recipes that you would like to share, please submit them to the editor: clare@huahuafarm.com
LET US KNOW WHAT YOU THINK! >> Write to us. We welcome Letters to the Editor up to 150 words. We reserve the right to edit for clarity and length. Include your name and email address >> Email: info@KonaCoffeeFarmers.org with SUBJECT: Commentary.