VZCZCXYZ0003
RR RUEHWEB

DE RUEHLGB #0193/01 0581816
ZNR UUUUU ZZH
R 271816Z FEB 06
FM AMEMBASSY KIGALI
TO RUEHC/SECSTATE WASHDC 2423
INFO RUEHXR/RWANDA COLLECTIVE

UNCLAS KIGALI 000193 
 
SIPDIS 
 
DEPT FOR AF/C 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV EAGR ETRD RW
SUBJECT:  DEMAND FOR RWANDAN SPECIALTY COFFEE ON THE RISE 
 
 
¶1.  Summary:  Ambassador hosted an event February 24 for a 
visiting delegation from the Specialty Coffee Association of 
America, which represents the USD 20 billion U.S. coffee 
industry.  This first annual coffee event showcased the 
exceptional quality of Rwandan specialty coffee and marked 
the beginning of this year's coffee harvest, expected to 
double for the third consecutive year.  Members of the 
Rwandan government, media, private sector, and the 
diplomatic community joined representatives of the coffee 
industry in recognizing the achievements of the Rwandan 
coffee industry.  In just five years, since 2001, Rwandan 
coffee has become one of Africa's great success stories and 
a major export, generating high demand in the international 
market and translating into a better quality of life for 
Rwandans.  End summary. 
 
High U.S. Demand for Rwandan Specialty Coffee 
--------------------------------------------- 
¶2.  Opening the event, Ambassador remarked that the U.S. has 
been in partnership with Rwandan coffee investors and 
cooperatives to expand the production and export of 
specialty coffee through a comprehensive USAID-funded set of 
programs.  This partnership between the two countries has 
produced a remarkable level of achievement in the Rwandan 
coffee industry. 
 
¶3.  Green Mountain Coffee Roasters recently introduced a 
line of "Special Reserve" coffees appealing to the most 
discriminating coffee connoisseur.  The first coffee to be 
marketed as "Special Reserve" was the Rwandan Karaba 
Bourbon, described as "an extraordinary discovery that pairs 
classic East African attributes with unexpected depth and 
body."  It sold out within days of going on the market. 
Starting mid-March 2006, Starbucks for the first time will 
showcase a Rwandan coffee (Blue Bourbon) for two months in 
its "Black Apron Exclusives" line, a category of coffee 
reserved for the "best of the best" coffees, in 5,000 retail 
outlets across the U.S.  Launched in April 2004, this 
premium line features rare, fine coffees in limited 
quantities.  Thousand Hills Coffee Company, established in 
2004, sells Rwandan coffee exclusively and aims to support 
social initiatives, such as schools and community centers, 
with some of its profits. 
 
¶4.  In a February 20-24 visit to Rwanda to congratulate and 
thank the Rwandan farmers for their Blue Bourbon coffee, 
Starbucks presented 20 cows and 300 goats as a direct 
premium to the top coffee producers in the Western Province 
who produced the coffee for its "Black Apron Exclusives" 
line.  Starbucks hopes that Rwanda will become a regular 
producer for its "best of the best" coffee promotions. 
 
Development of Specialty Coffee Industry 
---------------------------------------- 
¶5.  Until recently, Rwanda did not produce high-quality 
coffee.  Farmers produced low-grade beans as their main cash 
crop, and the sector is only now recovering from the 
devastation in 1994.  Thanks to the support of USAID, 
Rwandan coffee farmers began producing high-quality coffee 
for the first time in 2001.  Today, Rwandan coffee has 
become known as one of the "the best of the best" coffees in 
the world.  In 2005, Rwanda exported 1,100 tons of high 
quality coffee, earning top prices for the coffee growers. 
These coffee revenues have resulted in better health care, 
education, and housing in coffee farming communities, giving 
Rwandan farmers hope for a better future. 
 
¶6.  USAID-Rwanda estimates it has invested over USD 10 
million in promoting and developing the Rwandan coffee 
industry since 2001, building and rehabilitating coffee 
washing stations, training farmers, training "cuppers" 
(coffee tasters), organizing cooperatives, encouraging banks 
to invest in coffee washing stations, and improving rural 
infrastructure.  USAID has also been encouraging farmers and 
coffee washing station operators to maintain good discipline 
and a good eye in picking the best coffee cherries to meet 
the challenge of maintaining the high quality of coffee. 
According to USAID, the investment has paid off, with Rwanda 
now producing one of the world's best coffees, which has 
helped reduce poverty and improve the livelihood of over 
200,000 people in the rural areas.  We anticipate this 
increase in prosperity will also mitigate against 
traditional rural conflicts. 
 
Rwandan Coffee in the U.S. 
-------------------------- 
¶7.  Rick Peyser, President of the Specialty Coffee 
Association of America and Director of Vermont-based Green 
Mountain Coffee, provided a sense of how quickly and 
strongly the demand for specialty coffee has been growing in 
the U.S.  In 1990, there were approximately 2,250 outlets 
for specialty coffee in the U.S.  Today, there are 20,000 
outlets.  In 1992, Starbucks had only 165 stores; today, it 
has over 9,000 stores worldwide, with over 100,000 
employees.  He noted that specialty coffees are now taking 
up more shelf space at the expense of larger, mass-market 
brands, but that maintaining the competitiveness of 
specialty coffee requires a lot of energy, time, and 
discipline. 
 
¶8.  Thanks to USAID, he said, cuppers have been trained to 
improve the quality of coffee, and the quality of Rwandan 
coffee is on the rise.  He noted that just last week, 
Rwandan coffee was featured as the very first offering in a 
new "Special Reserve" program launched by Green Mountain 
Coffee that brings in limited supplies of very high quality 
coffee.  Prior to the arrival of the shipment, the coffee 
was already sold out. 
 
Government Initiatives to Promote Industry 
------------------------------------------ 
¶9.  Minister of State for Commerce Protais Mitali recounted 
the long coffee tradition in Rwanda, which started in 1902 
when the first coffee plants were introduced by German 
missionaries in the southwest of the country.  Since then, 
coffee has played a prominent role in the socio-economic 
development of Rwanda as a major source of income for rural 
families and a major source of foreign currency for the 
country in general.  He noted that Rwanda has natural 
features conducive to the production of high-quality coffee 
beans, including high-altitude coffee growing zones, 
predictable rainfall, and fertile volcanic soil. 
 
¶10.  Mitali noted that Rwanda recently launched a major 
quality improvement program, focusing on boosting production 
and quality, to ensure that its natural potential is fully 
exploited.  He said that the dissemination of modern coffee 
production and processing methods to producers will ensure 
that the natural quality of beans produced by Rwanda's 
farmers is preserved.  He added that the Rwandan coffee 
sector is committed to improving the industry at all levels, 
from production to primary and secondary processing, through 
education on ways to improve production and investment in 
coffee washing stations. 
 
¶11.  Recognizing that the American market offers numerous 
advantages, both in terms of quality demand and social 
responsibility, the Rwandan government, in cooperation with 
USAID and other partners, would like to launch the "Cup of 
Excellence" program in Rwanda, he said.  Under this program, 
a select group of national and international cuppers select 
the very best coffee produced in a country in a particular 
year.  The Rwandan coffee industry has already approached 
the U.S.-based program about setting up a program in Rwanda 
and is looking for funding.  He thanked USAID for its 
support of coffee cooperatives and private investors in 
increasing production of specialty coffee and promoting it 
in the U.S. market. 
 
Comment 
------- 
¶12.  In 2005, Rwanda exported an estimated USD 35 million in 
coffee exports worldwide, including USD 5 million in coffee, 
mainly specialty coffee, out of a total USD 6 million in 
goods to the U.S.  Of the USD 35 million in coffee exports, 
specialty coffee exports worldwide generated approximately 
USD 3 million in revenues, double that of 2004.  As Rwanda's 
number one agricultural export, coffee is playing a 
significant role in Rwanda's economy, representing 
approximately one-third of the total value of Rwandan 
exports.  Rwanda's emergence on the international market as 
an exporter of "specialty coffees" could lead to a dramatic 
increase in Rwanda's economic growth and development. 
Despite recent budget cuts in its Development Assistance 
funds and a recent decision to phase out the critical Title 
II food aid program (Food-for-Peace), USAID foresees 
continued, albeit reduced, support to the Rwandan coffee 
sector in upcoming years, focusing on applying best 
practices throughout the country in production and 
processing techniques, as well as assisting the GOR in its 
effort to double the number of coffee washing stations. 
 
ARIETTI