On November 11, Starbucks Coffee Company signed Memorandum Of Understanding (MOU) agreements with Yunnan Academy of Agricultural Science (YAAS) and People’s Government of Pu’er City, Yunnan Province. The company agreed to collaborate with the two governmental organizations to help local farmers promote responsible coffee-growing practices and develop localized high-quality coffee.
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Starbucks intends to accomplish these goals through its investment in and operation of its first ever base farm, a coffee development center, coffee farmer support center, and coffee processing facilities in Pu’er.
As part of the collaboration, Starbucks will develop and operate a base farm and processing facilities to further strengthen the company’s foundation that will support its continued and sustained growth in China. Additionally, the company will operate a Farmer Support Center, its first in Asia and third globally following Costa Rica and Rwanda. Starbucks experts will work directly with Yunnan’s coffee farmers to provide resources and expertise to promote responsible coffee-growing practices. Research will be conducted on areas such as new varietals for local adaptation, disease resistance and flavor improvements.
The provincial government plans to invest RMB 3 billion (US$450 million) in expanding green bean volume from the current 38,000 tons to 200,000 tons by 2020. It will also increase coffee acreage from the current 26,700 hectares to 100,000 hectares within the same period. The company will introduce Starbucks Coffee and Farmer Equity (C.A.F.E.) Practices, which have helped farmers achieve improvements in coffee quality evaluation scores; up to a 25 percent increase in yield per hectare; and cost reduction of over $200 per hectare on average.
Since 2007, Starbucks purchases of Yunnan coffee have increased approximately 20 fold. Starbucks collaboration with Yunnan province coffee farmers and suppliers reached a major milestone with the launch of Starbucks® South of the Clouds Blend™ in early 2009.