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Lot Traceability and Quality Differentiation

Lot Traceability and Quality Differentiation. Presented by Carl Cervone TechnoServe Ethiopia Email: ccervone@tns.org. IN ETHIOPIA, LOT TRACEABILITY BEGINS AT THE WET MILL (FOR WASHED COFFEE). Exhibit A: No lot separation Parchment stored in piles / LIFO system

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Lot Traceability and Quality Differentiation

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  1. Lot Traceability and Quality Differentiation Presented by Carl Cervone TechnoServe Ethiopia Email: ccervone@tns.org

  2. IN ETHIOPIA, LOT TRACEABILITY BEGINS AT THE WET MILL (FOR WASHED COFFEE) • Exhibit A: No lot separation • Parchment stored in piles / LIFO system • Benefits: low cost / easy to manage • Drawbacks: no quality differentiation, risk of theft, no tracking of ratios during the season • Exhibit B: Simple lot separation • Parchment stored in labeled bags / FIFO system • Benefits: quality can be differentiated, reduced risk of theft, ability to track ratios during the season • Drawbacks: higher cost / more difficult to manage

  3. “LOT SEPARATION” SHOULD BE PRACTICAL FOR THE PRODUCER Should aim for at least 3 different lots and up to 10… of high grades only!

  4. THIS “LOT SEPARATION” METHOD MEANS THAT SOME LOTS WILL BE FILLED VERY QUICKLY AND OTHERS WILL TAKE LONGER Lot 5 Lot 4 Lot 6 Lot 7 Lot 8 Lot 3 Lot 2 Lot 9 Lot 1 Lot 10 (Low Grades) Week of harvest

  5. THEN COMES THE CUPPING / QUALITY EVALUATION OF EACH LOT Sour, ferment, baggy Clean, bright, floral Wow!! Taste of Harvest Lot 5 80 Lot 4 89 Lot 6 Clean, bright, fruity Clean, good body 90 Clean, bright, floral Lot 7 Lot 8 88 87 Lot 3 Fruity, some over-ripe 88 Clean, bright Thin, insect-damage Lot 2 Lot 9 86 84 Lot 1 82 Yuck! Lot 10 (Low Grades) n/a Week of harvest

  6. FINALLY, YOU CAN MAKE MARKETING / BLENDING DECISIONS 3rd Blend Top Blend DST or special buyer Lot 5 80 Lot 4 89 Lot 6 Top Blend 90 2nd Blend Lot 7 Top Blend Lot 8 88 87 Lot 3 88 3rd Blend 2nd Blend 3rd Blend Lot 2 Lot 9 86 84 Lot 1 Local Market 82 Lot 10 (Low Grades) n/a Week of harvest

  7. OFTEN TIMES, THE EXTRA EFFORT WILL RESULT IN ADDED VALUE Top lot (10%) Top blend (30%) 2nd blend (20%) New avg price Base price (all coffee blended together) 3rd blend (30%)

  8. EVEN WITHOUT A HIGHER AVERAGE PRICE, THERE ARE OTHER BENEFITS OF LOT SEPARATION • Quality problems can be identified and hopefully rectified in the future, e.g., first pickings usually have a lower ratio and poor cup profile, so cherry price should be lower • You can prevent theft– ensures coffee is weighed / quantified in storage, and missing coffee can be spotted from open bags • Monitoring ratios and qualities during the season will give you a much better understanding of the interaction of natural and operational (man-made) variables, allowing you to better manage your business • FIFO (First In, First Out) systemis generally a better warehouse management system (than Last In, First Out – LIFO), since it ensures more consistent freshness / moisture content / quality levels

  9. IT IS IMPORTANT TO FIND AN ECONOMICAL BALANCE BETWEEN QUALITY DIFFERENTIATION AND COST-EFFICIENCY Quality differentiation Cost-efficiency Coops in prime high altitude growing areas Big traders of unwashed Djimma 5 types

  10. THANK YOU!

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