How The Coffee MSMEs Are Coping During The ECQ. How Will They Recover After?

In the Covid-19 global pandemic, all businesses regardless of size are facing serious challenges. In the Philippines, one of the greatly affected areas is the coffee industry.

- Aarichela L. Dela Cruz

De La Salle University Food and Water Institute director and coffee scientist Dr. Mel Garcia said that “the current situation is a huge setback for the coffee industry, especially the micro, small, and medium enterprises (MSMEs). The Philippines is poised for growth and the industry has seen steady progress over the past years. But right now, the International Coffee Organization is projecting a 0.95 reduction in growth for global demand for coffee for every single percentage drop in GDP growth, or about 1.6 million 60-kilo bags.”

From farmers to coffee shop owners and coffee training schools, the effect of the enhanced community quarantine (ECQ) is felt throughout the coffee value chain.

Current conditions

Kalsada Coffee, a local coffee purveyor that supports Filipino coffee producers in bringing their coffee to the market, said that with the limitations in logistics, coffee beans are now sitting in farm warehouses, which also causes delay in payment collection. Tere Domine, Kalsada’s country director, says coffee farmers resorted to availing loans from microfinancing institutions to cover the daily expenses while waiting out the effects of the ECQ. Kalsada’s international business transactions are also affected with the export market at a standstill.

Mich Sy of Timemore Philippines, a local distributor of coffee brewing equipment, stated that they are also experiencing logistical challenges with international suppliers. With stocks depleting, there is not enough inventory to cover short term material outages.