WWF-Indonesia field research

Assessing the impact illegally grown coffee on the park

WWF-Indonesia carried out field research between October 2003 and June 2004. First, satellite images were used to plot changes in vegetation cover, including natural forest, open land, coffee plantations, rice and cocoa fields. Then a survey was carried out to determine the abundance of coffee in both old and newly encroached areas of the park. This was followed by an investigation into the chain of custody of illegal coffee. Tracing trade links from the coffee plantations in the park to the international recipients was the most important and complex part of the research.
Data collected showed that an estimated 28% (or 99,904 hectares) of the park had been degraded. Sixty per cent of the degraded area was being used for agricultural cultivation; the remaining area was covered by shrubs and imperata grass. Farmers on the encroached land were growing robusta coffee as their main agricultural crop, with smaller amounts of other cash crops like cinnamon, patchouli, pepper, cocoa and clove.

Coffee accounted for 73% of commodities grown inside the park and was cultivated on 45,657 hectares by small-scale farmers. Each household cultivated 2 hectares of coffee on average. The quality of the coffee beans was moderate relative to beans produced elsewhere in Lampung. Total coffee production inside the park was estimated at 19,600 tons.

WWF-Indonesia's field investigation of the coffee trade routes from within Bukit Barisan Selatan National Park to the international market led to some of the largest coffee companies and most famous household brands in the world. Research identified the following chain: the farmers sold their harvest to the nearest trader (collector) at sub-village or village levels.

These traders mixed the coffee from inside the park with coffee grown outside the park and sold on the mixture to sub-district or district-level coffee traders. These sold the coffee on to coffee exporters based in Bandar Lampung, the capital of Lampung Province.
The Workers Spilling Out the Coffee Beans from the Gunny Bags, illegal coffee trading from Kayu Are ... / ©: WWF-Canon / WWF-Indonesia / BBS
The Workers Spilling Out the Coffee Beans from the Gunny Bags, illegal coffee trading from Kayu Are to PT Aman Jaya Perdana, Bandar Lampung, Bukit Barisan Selatan National Park, Indonesia.
© WWF-Canon / WWF-Indonesia / BBS
Identifying the supply chain
As a result of the WWF research it has been possible to identify the exporters, buyers and destination countries involved in the illegal coffee trade. During the study, more than 40 coffee Bandar Lampung exporters were identified operating in 2003.

They were distributing the coffee beans to at least 52 countries in Europe, Asia, America, Africa and Australasia. In 2003, exported unwashed coffee beans leaving Lampung tainted with coffee grown illegally in the park totaled 216,271 tons, including small amounts coming from Bengkulu and Sumatera Selatan provinces.

Export volume steadily increased to 283,032 tons in 2004 and 334,864 tons in 2005. On average over the three years, the largest exporters were Aman Jaya Perdana (22,596 tons), Andira Indonesia (20,054 tons), Antara Saudara (19,962 tons) and Indera Brothers (17,032 tons). In 2005, the largest exporter was PT Alam Jaya with 28,346 tons, followed by PT Indo Cafco (Ecom) with 23,738 tons and PT Aman Jaya Perdana with 20,728 tons.

Largest importing countries and companies
The United States, Germany, Japan and Italy were the largest importing countries of tainted Lampung coffee in 2004 and 2005, accounting for more than 50% of all coffee imports from the region. Other significant recipient countries include Algeria, India and the United Kingdom.

In 2003, 55% of all exported Lampung coffee was received by just 6 companies and their respective partners : US-based Kraft Foods (including Taloca), the UK’s ED&F Man, the Netherland’s Andira, Hong Kong’s Noble Coffee, Germany’s Neumann Kaffee Gruppe, and Japan’s Marubeni Corporation. Germany’s Hamburg Coffee Company, Switzerland’s Nestle, Singapore’s Olam and Italy’s Lavazza completed the top 10 of receiving companies. Of 2003's top 10 Lampung coffee recipients, Taloca, Kraft and Nestlé were the top recipients in the years 2003, 2004, and 2005, respectively.

Japanese firms Marubeni and Itochu maintained similar import levels over the three years. ED & F Man's and Andira's imports dropped, while Nestlé’s and Lavazza's imports increased. Some other recipients received very large volumes in 2004 and 2005, namely J. Mueller Weser in Germany, Robert G. Marshall in the U.S., Pacorini in Italy and the U.S., and World Transport in the UK, rerouting the stream of Lampung beans into the EU and United States. Other globally known roasters Folgers (P&G), Tchibo and Starbucks received smaller shipments of coffee from Bandar Lampung's exporters in 2004.
Because of the way illegal coffee from the national park is commingled with legally grown coffee before being sold, international coffee companies sourcing from Lampung Province may have been unaware that the coffee they were procuring was grown illegally at the expense of protected elephant, rhino and tiger habitat.

Yet the international coffee market played and continues to play a key role in creating market forces that drive deforestation in Sumatra, highlighting the need for companies to introduce, implement and monitor responsible coffee procurement policies. Legal and sustainable coffee production is possible, but it requires coordinated efforts on supply chains, production systems, habitat protection and restoration.

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