To ease payment and eliminate the exploitation of middlemen in the coffee value chain, a Ugandan company has started using Block chain-technology - a shared public ledger.
This system which according to Mr Mwambu Wanendeya – chief executive officer -Carico Café Connoisseur, the company behind this initiative is also expected to address the current low global coffee prices.
In an interview with Prosper Magazine, Mr Wanendeya said: “By using Blockchain, we will be eliminating some of the middlemen between the farmer and consumer. The farmers will be getting better prices.”
“The more people involved in the coffee supply chain, the lower the value the farmer gets. We believe Block chain is the way forward,” he added.
The block chain network allows Bitcoin wallets to calculate their spendable balance so that new transactions can be verified thereby ensuring they’re actually owned by the spender.
He said: “Carico Café Connoisseur is using blockchain to certify the origin of coffee. This is because increasingly in the market we supply, the consumers want to know the origin of the coffee and are prepared to buy and pay more if they get to know the source of the market.”
The company which started operations in 2015 sells Ugandan coffee to supermarkets in South Africa, Switzerland and on Amazon in the United States and is now looking to export to other European countries.
Commenting about this company’s initiative to use Block chain with the farmers, Financial Sector Deepening Uganda’s manager financial services, Mr Joel Muhumuza said: “If this technology is done properly, it gives visibility to people on how things were sourced and who was involved. This is done in a faster and efficient manner.”
UCDA Emmanuel Iyamulemye UCDA’s executive director reacting to this system, said: “Traceability is a good practice that as people become more and more health conscious they seek for the source of the products they consume. Its advantage is that people pay premium prices.”
He said if the good agronomical practices are followed, there is value for money Therefore, we would wish to see farmers grow quality coffee from the farm.
Carico is one of the few companies in the country which link the farmers in the farm all the way to big international supermarket shelves.
The company sells its coffee to South Africa, Switzerland, on Amazon in the United States on Amazon and is now looking to export to other European countries.
Commenting about the low consumption rated at less than 4 per cent in Uganda, Mr Wanendeya said this can be improved with increased familiarity to some of the other coffee products such as cold brews and iced coffees which are not exploited in Uganda.
He said they have plans to promote the new types of coffee drinks when the company opens up its outlets in Kampala soon so that people can enjoy the other types of coffees.
“We don’t see coffee as a hot drink alone but as a cold drink as well and an alcoholic beverage too,” Mr Wanendeya said.
He said when they were starting business in Uganda in 2015, their priority was securing the supply chain.
Uganda currently exports over 4.7 million bags valued at over $508 million (Shs1.8 trillion).
Carico Café is working with two farmer cooperatives with hundreds of members. Wanendeya predicted the innovation could boost farmers’ incomes by 10 per cent.