Nicaragua as a coffee country
In this post, we will try to give you a better understanding of what makes Nicaragua a very special coffee country and how their chaotic and hard history has affected the country and the development of coffee.
Welcome to the land of lakes and volcanoes!
Let’s just take the fundamentals of Nicaragua first. Nicaragua is located in Central America, and shares borders with Costa Rica to the south and and Honduras to the north. They have an area of 130,370 square kilometers which is about 3 times larger than Denmark, where about 6.5 million people live (it is at least estimated to be). The country is known as “the land of lakes and volcanos” due to the two giant lakes and the 23 volcanoes (of which 19 are still active).
Nicaragua is one of the poorest countries in America, with 48% living below the poverty line while 80% living on less than $ 2 per day. There is a smaller middle class and an upper class of 2% of the population. A large part of the cause of the great poverty is that Nicaragua has been marked by a great political instability that led to a civil war that stretched over 3 decades from the early 60s until the late 80s. The economy is largely based on the export of agricultural goods, and the main export goods are cotton, cocoa, meat, sugar and coffee. It is also seen by the fact that large parts of the middle and upper classes are owners of significant amounts of land.
A fun fact about Nicaragua is that in Nicaragua they have no street names and therefore no addresses. That makes it somewhat awkward when we have to find our way around. A typical address could be “The main road 103 kilometers north of the airway, to the right of the baseball field”.
In addition, Nicaragua is known as one of the world’s best surf destinations. Especially on the west coast of the Pacific Ocean, where you can find small coastal towns filled with surfers from all over the world. We usually look past San Juan del Sur when we are in Nicaragua, to enjoy the warm sun and white beaches, while we hone our surfing technique (disclaimer: we are pretty poor).
Read on to hear more about Nicaragua as a coffee country and the coffee crisis in Nicaragua.
Here is a little mood video from Nicaragua:
Coffee in Nicaragua
Nicaragua is not the world’s largest producer of coffee and accounts for just 1.2% of the world’s coffee market, making it the 13th largest coffee country by volume. What is special about Nicaragua is that about 95% of the coffee comes from very small farms, where coffee is the primary or only source of income and the family is the primary labor force. In fact, there are over 45,000 family-owned coffee farms in Nicaragua and over 300,000 people in Nicaragua are employed in coffee.
Coffee from the land of lakes and volcanoes
In addition, the majority of coffee farms are organic, but not because they themselves have chosen to grow organically. The primary reason many farms are organic is that they do not own a truck to be able to ship manure up to the farm, or that they simply cannot afford the manure. These are typically the slightly smaller farms, where coffee is most often only part of the production on the farm, where they also grow beans, cocoa or keep cows and pigs. However, more and more of the more professional coffee farms are starting to grow organic coffee and become proficient in the cumbersome processes it takes to produce enough organic fertilizer to maintain quality and volume.
However, Nicaragua has been constantly evolving, and since the coffee crisis started in the 00s (which we will talk more about in the next section), Nicaragua has been recognized for producing some very exceptional specialty coffees and is among the countries that produce the best coffees in the world. characterized by having good fullness and vigor with a fresh and fruity acidity. One often finds notes of chocolate, nuts, caramel and citrus fruits.
If you are interested in trying different coffee from Nicaragua, we would recommend our coffee subscription , where, in addition to a fixed coffee variant, you receive a varying specialty coffee from Nicaragua every month.
The coffee crisis
Coffee is Nicaragua’s largest export commodity, and is a key player in the country’s economy. However, the more than 45,000 coffee farmers who produce the coffee have been through something of a roller coaster ride with natural disasters, civil wars and financial instabilities.
Nicaragua was hit hard by Hurricane “Mitch” in 1998, which created floods and landslides that meant a total collapse of Nicaragua’s coffee production and drove coffee prices down until 2003. It affected not only the coffee industry but the entire country’s economy, and resulted in 3 out of the 6 largest banks going bankrupt, as well as 4.5 million working days being lost as a result of destroyed fields and floods in the first 2 years. The crisis hit families particularly hard if the primary source of income was coffee. Many pulled their children out of schools and lived off the other goods they could grow on the farms, such as beans, rice and mangoes.
Thousands of people working on the farms lost their livelihoods and many fled to Costa Rica, while others lived off food donations along the country roads.
Nicaragua has since rebuilt their coffee industry, which today is strong and with an increased focus on specialty coffee, which also means higher prices for farmers. However, the crisis showed just how dependent the entire country’s economy is on coffee production.
However, despite an intensified coffee market, Nicaragua has ended up in a political crisis that has created a great deal of instability for the coffee farmers and makes life difficult and insecure for the entire population. It started back in the spring of 2018, when President Daniel Ortega and his wife made some welfare reforms that led to major protests and demonstrations. Reaction from the government was fierce, leading to roadblocks and clashes between the army and protesters that also cost several lives.
Since then, more than 62,000 people have fled the country, foreign investors and tourists have left the country, and any attempt at protest is being monitored and shut down by the army. It has put a lot of pressure on the economy in the country, and GDP fell by almost 4% in 2018 and 3.9% in 2019.
For the coffee industry, this has meant that access to finance for the coffee farmers has been enormously difficult and for many impossible. The banks, financed by money from the United States, are nervous about the situation, fearing that the farmers will not be able to sell their production to an international market, and thus will not be able to repay their loans. This has meant that some coffee farms have not been able to harvest their production, which has instead rotted on the trees, or lost money because their interest rate has been above 50% annually. Many have been forced to sell to local traders (also called coyotes) in order to get the money in quickly, but the result is that they get a significantly lower price, and have difficulty getting the accounts to run around. In addition, coffee roasters and wholesalers have dropped their visits and purchases in the country, due to fears for their safety. Instead, they choose to visit and buy coffee from one of the many other coffee countries in the world, and this has hit Nicaragua coffee sales hard and pushed prices down.
The political situation has been very quiet lately, but Nicaragua is facing the next presidential election in late 2021, and it is feared that the conflict will flare up again.
At ØNSK, we have a constant eye on the situation, and hope that a solution will come soon, so that the local population will not be hit harder than they have already been, and that they can continue the development as a budding specialty coffee country. Important to us is to stick to our principles of trading directly with the farmers, maintaining the relationship and taking the time to visit the farms despite the uncertainty as Nicaragua more than ever needs foreign roasteries and buyers.
ØNSK in Nicaragua
At ØNSK, we exclusively have coffee from Nicaragua. That’s how it all started back in 2017 when Rasmus and Andreas started ØNSK. Rasmus has a family that makes honey and cocoa in Nicaragua, it was through this that we first went to Nicaragua where we met a lot of coffee producers. It was a great experience to see the hard work behind the coffee we drink, and the dedicated people who are passionate about coffee but have a hard time making a living from it, due to pressured coffee prices and climate change. This is where the idea of buying coffee directly from the coffee farmers arose, and in this way ensure that more of the money ends up with the coffee farmers and their families rather than with intermediaries.
In the beginning, we only bought very small quantities from the Corcasan cooperative, which we picked up at home and roasted in Elsinore. Today we buy coffee from several individual farms, as well as a large portion of coffee from the cooperatives Corcasan and Café de Alturas. In 2020, we purchased approximately 40,000 kilos of green coffee.
However, our principles have not changed, and one of our most important (and funniest) tasks is when we go around every year during the harvest and visit all the coffee farms we trade with. Here we lend a hand on the farm and talk and discuss coffee growing and how we can develop our collaborations. We also visit new farms to expand our range as our business grows. Here we also taste hundreds of coffees, to get an idea of how this year’s harvest will taste.
We love Nicaragua, and are always impressed with the hospitality and the positive attitude we are met with, despite the fact that they have a harsh history that continues to make life difficult for them. We always feel welcome and have formed both strong friendships and professional relationships, which give us meaning in our work in both Denmark and Nicaragua, where we feel we can make a difference.
We can only recommend a visit to the country and you are welcome to contact us if you need travel tips or want to visit a coffee farm.
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