Tracing the journey: how technology is creating a deforestation-free coffee supply chain

In 2022, the European Union enacted the world’s first law (the EUDR) against deforestation-linked commodities like coffee. Companies must verify that their goods have not contributed to deforestation, or they cannot export to the EU market. Now, coffee companies throughout the supply chain must up their game in addressing deforestation in their value chain. But how to do it?

Deforestation-free claim: challenges

Companies across the globe have relied on voluntary certification schemes like Rainforest Alliance, UTZ, or 4Cs to get their coffee certified. However, certification ‘is ineffective at a landscape level unless all producers adopt them and there is (near) real-time monitoring of deforestation,’ says Nam Pham, the Project Manager of the Café-REDD project at SNV, which addresses deforestation and forest degradation and promotes forest landscape restoration in the Lam Dong province of Vietnam.

The reason that certification is ineffective across the whole landscape is that it ignores much of the coffee. Certification does not ensure all coffee is deforestation-free, it just tells you if your cup is.

It also excludes many farmers whom the process was most designed to help. Smallholder farmers, especially those at the forest frontiers, are often excluded from these certification processes due to the costs and capacity required to achieve voluntary certification. Even if farmers can become certified, for many, the incentive is not there, and the small additional income is not considered to be worth the extra effort.

‘We need an application that is easy for farmers to use and accessible in remote locations with poor phone signals. Unlike conventional paper farm journals used in certification processes, this app should coordinate direct communication between producers and companies to reduce farmers’ reluctance to record their activities,’ says Phu Pham, Value Chain Advisor of the Café-REDD project.

SNV’s deforestation-free toolkit: tracing from forest, to farm, to cup

The Café-REDD project has created a digital monitoring and traceability system that goes beyond certification to verify that the complete journey of the coffee value chain is deforestation-free. The toolkit includes three different but interrelated tools and systems to achieve this goal:

1. A satellite-based forest monitoring tool managed by the local government’s forest protection department provides ‘near’ real-time alerts of forest loss and land use change.

2. A comprehensive farm database and map builds a geospatial record of all coffee farm locations that help coffee companies source deforestation-free coffee and aid policymakers in designing interventions.

3. A digital traceability tool designed by a leading provider of digital traceability in Vietnam - TraceVerified - and operated by companies and farmers, including those living in rural areas. Consumers can verify the origins of their coffee from harvest until point-of-sale through QR codes and transparent information and images.

Technology can define the future of coffee traceability

The forest monitoring tool has been in use in Lac Duong district since February 2020, and all government stakeholders were trained to track forest loss using the satellite-based system. By December 2022, farm mapping of 2,752 hectares was achieved, creating the first comprehensive database of coffee farms and farmers in the district, a vital resource for public agencies and the private sector. Nine companies are piloting the digital traceability tool so far.

Trace Verified is constantly consulting with companies and the local government in Lac Duong to improve system quality. SNV’s project has collaborated with TraceVerified to train farmer leaders to master this system, contributing to the maintenance and promotion of this app. In the upcoming harvest of 2023, two-way communication between companies and farmers is expected to complete the data of the whole coffee journey, including information on fertilisers and drugs on the allowed list. This next step promises a traceability system that can prove your next cup of coffee is worry-free from deforestation.

Entrepreneur K Chăm, who established the Yu M’Nang coffee enterprise in her ethnic minority community, said: ‘This kind of traceability system will create opportunities for small businesses like us to validate our sustainable practices. If the application can prove its cost-effectiveness, this system will benefit our transparency and network with our current and prospective Japanese and European exporters in the future.’

The deforestation-free toolkit represents a promising future for coffee traceability, and technology is set to define it.