The Rise of China’s Coffee Capital

In a culture that highly values tea, can coffee compete?

To understand how coffee is blossoming among the largest population in the world, we spoke to Hou Jiazi, a coffee agronomist who works at Nestle Agricultural Services in Pu’er, China.

Eighteen years ago, I started working for Nestlé as a coffee agronomist. If you’d told me then that I’d play a part in China’s emergence as a world-class coffee producer, I would never have believed you.

The Chinese have grown our national drink, tea, for over 3,000 years, but coffee was only introduced around 100 years ago. No one really valued it. Only poor quality beans were grown in meager amounts.

Attitudes began to change in the late 1980s. Farmers in the Yunnan province, Southwestern China, grew tea, maize, or corn for poor returns. The government wanted to help these smallholders escape poverty and encouraged them to grow coffee, which was more profitable.

When I first arrived in Yunnan in 1997, I started working on an experimental coffee farm newly established by Nestlé to figure out which types of coffee tree were best-suited to local conditions.

Rapid rise in living standards

At that time, farmers still lived in cramped mud huts and rode motorbikes — now, most live in villas and own cars. They have coffee to thank for this rise in living standards. In Pu’er, the region of Yunnan where I live and where most of China’s coffee is grown, production rose from zero in 1988 to 50,000 tons in 2014.

How?

At our buying station in Pu’er, we purchase locally grown green Arabica coffee beans for use in Nescafé. We buy directly from farmers to cut out middlemen and remove the risk of exploitation by paying market-leading prices.

The coffee must conform to our global quality standards. The farmers bring us their coffee beans, and we roast and grind a few before brewing them up to taste, to check their quality before we buy. We’re looking for high acidity, a full body, good aroma and flavor, with notes of osmanthus or jasmine.

Tasting 10,000 cups of coffee

The Nestlé Agricultural Service (NAS) team in Pu’er samples as many as 10,000 cups during each yearly buying season, which begins in November and ends between March and late July.

Before we taste any coffee, my NAS colleagues and I work closely with local farmers to help them improve yield and quality. I’m in charge of providing technical assistance to coffee growers through training and field visits.

Over 27 years the team here has run 258 training courses with more than 15,000 farmers to teach coffee growing skills, processing and cup tasting. We’ve helped them to generate high yields and improve coffee quality, while teaching them sustainable production methods and how to lower production costs.

Sustainability and the Nescafé Plan

We’ve always focused on sustainable coffee growing in Yunnan — stopping soil erosion was one focus when we began encouraging coffee cultivation in the late 1980s. Nestlé launched the Nescafé Plan globally in 2010, and in China in 2011, and it helped us improve our farmer training to focus on the Nestlé Better Farming Practices and implementing the Common Code for the Coffee Community (4C).

Through the Nescafé Plan, we significantly increased the amount of coffee we buy in Yunnan, and all the coffee beans that we buy directly from farmers must comply with the 4C code. This includes provisions that, for example, guarantee growers a fair price, help them conserve water, and restrict use of chemical fertilizers.

We sometimes find it difficult to persuade farmers to follow our advice and grow coffee more sustainably, by limiting water use in irrigation and processing, for instance. My team also trains farmers who have never grown coffee before, which can be challenging, but it’s incredibly rewarding.

Educating coffee farmers in remote areas

Many farmers live in remote places, so it can be a struggle to reach them, especially in the rainy season. When we do reach the farmers, communicating with them can be tricky, as China has almost 300 different languages.

We do our best to get the message across, and we’ve built trust with farmers over the years by helping them obtain better prices and a steady income to improve their living standards. In return, the company secures a regular supply of quality coffee for Nescafé.

When I first came to Pu’er, my friends asked me why I went from a modern coastal city, Fangchenggang in Guangxi province, to a remote mountainous village 800 kilometres away.

Almost two decades later, Pu’er may still be a rural region, but the city is now known as the ‘Coffee Capital of China.’ I’m proud of the small part I’ve played in this transformation, and have learned so much, not just about growing coffee, but how growing it can bring positive social change.

China: the world’s fastest-growing coffee market

Although 80% of the coffee we grow here is exported, Nestlé’s investments in China’s coffee industry have helped make it the world’s fastest-growing coffee market. In 2006, the company launched the first ‘100% Yunnan’ Nescafé in China, which shows how far coffee quality here has come.

Traditionally the Chinese found coffee too bitter, but today it’s catching on, especially among younger people in big cities like Shanghai and Beijing, where coffee with a richer, more aromatic, milky taste is increasingly popular.

China is home to 1.4 billion people and coffee sales are already significant, but the average person only drinks four cups a year — compared to 150 cups in Hong Kong! There’s still massive growth potential, and it excites me to think that, here in Yunnan, we’re playing a vital role in China’s new coffee culture.

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