Turin, Italy-based Luigi Lavazza S.p.A. (2016 revenues exceeded US$1.6 billion) has joined Vevey, Switzerland-based Nestle SA (2016 revenues approximately US$94 billion) in seeking to increase the production, quality, and export opportunities for coffee beans sourced in the Republic of Cuba.
From the company:
“The Lavazza Foundation (http://www.lavazza.us/us/about-lavazza/sustainability-report/ ) is starting in Cuba a three-year project stems from a close collaboration with the local Cuban authorities. The project, in collaboration with Oxfam, enhance the training capacity of “School Centres” and the output of the Centres for grafting coffee plants in Cuba contributing to the sustainability, increased yield and quality of coffee plants in the country’s two eastern provinces, Granma and Santiago de Cuba, while improving the conditions of coffee producers in the area of interest. Specific goals are:
1. Increasing the production of quality coffee plants by creating ten production centres that contribute to the recovery of areas with limited production, while also supporting greater participation by women and young people in the agricultural sector.
2. Increasing producers’ and technicians’ knowledge of the coffee supply chain through the 34 "School Centres."
3. Strengthening the coffee supply chain while improving the living conditions of the rural population in the selected communities, and in particular those of the women involved.”
Nestle Nespresso To Indirectly Import Coffee From Cuba To USA
June 20, 2016
20 June 2016: New York, New York- Nestle Nespresso, the worldwide pioneer and reference in premium single-serve coffee, announced today it will bring back Cuban coffee to the United States for the first time in more than 50 years.
Recent regulatory changes in the United States have allowed Nespresso to move forward with its plans, which include making the new Cuban Nespresso Grand Cru, Cafecito de Cuba, available in the United States in the fall of 2016, initially as a limited edition. Over the long term, Nespresso and its partner TechnoServe, a nonprofit development organization, will explore how to work with smallholder coffee farmers in Cuba with the goal ultimately being to support farmers in their production of sustainable coffee and contribute to expanded economic opportunities for them in the long-term.
For more than two centuries, Cuba has produced some of the greatest Arabica coffee in the world. With fertile soil and ideal climate conditions, the country offers an excellent coffee growing environment. Nespresso is purchasing Arabica coffee this year that has been produced by Cuban farmers, and aims to continue purchasing it in the coming years.
“At Nespresso, we always aim to delight consumers through exclusive, unique coffee experiences,” said Guillaume Le Cunff, President Nespresso USA. “Nespresso is thrilled to be the first to bring this rare coffee to the U.S., allowing consumers to rediscover this distinct coffee profile. Over the long-term, we have a view to supporting the development of environmentally sustainable coffee farming practices for smallholder farmers which benefit the farmers themselves and their communities. Ultimately, we want consumers in the U.S. to experience this incredible coffee and to enjoy it now and for years to come.”
The U.S. Department of State in late April updated its list of goods produced by independent Cuban entrepreneurs that can be imported into the United States to include coffee. This change paved the way for Nespresso to offer Cuban coffee to the U.S. market.
Nespresso’s approach to sustainability is embedded in its business practices and focuses on initiatives that preserve the environment for future generations and create shared value for all stakeholders and society. Nespresso has extensive experience working closely with coffee farmers to improve productivity and create attractive income opportunities for them. Through the Nespresso AAA Sustainable Quality™ Program, which was developed with the Rainforest Alliance, Nespresso works with farmers, providing support, training, financing and technical assistance to improve sustainability and productivity while maintaining quality.
Next Stop For Cuban Coffee May Be Blue Bottle Coffee... Another Connection For Nestle
September 15, 2017
With it's majority-control purchase (reportedly US$425 million for 68%) of Oakland, California-based Blue Bottle Coffee, Nestle may have an additional distribution channel for its imports of coffee beans from the Republic of Cuba...
In 2016, the Obama Administration added coffee to the list of eligible imports from the Republic of Cuba.
To be eligible for importation into the United States, a listed Cuban Assets Control Regulations (31 CFR Part 515) Section 515.582 product (in this case coffee) must be “produced by independent Cuban entrepreneurs, as demonstrated by documentary evidence.”
From the United States Department of State: “Persons subject to US jurisdiction engaging in import transactions involving goods produced by an independent Cuban entrepreneur pursuant to 515.582 must obtain documentary evidence that demonstrates the entrepreneur's independent status, such as a copy of a license to be self-employed issued by the Cuban government, or in the case of an entity, evidence that demonstrates that the entity is a private entity that is not owned or controlled by the Cuban government.”
In 2016, New York, New York-based Nestle Nespresso USA, Inc., a subsidiary of Vevey, Switzerland-based Nestle SA (2016 revenues approximately US$94 billion), purchased a container of approximately eighteen (18) tons of green coffee beans through London, United Kingdom-based Cubana Coffee & Roastery (www.cubana.co.uk), the established bar-restaurant and coffee roasting group, and London, United Kingdom-based The Cuba Mountain Coffee Company Ltd (www.almacuba.com).
The green coffee beans were sourced from the 2015-2016 harvest in the Republic of Cuba; the value was approximately US$5,000.00 per metric ton, or approximately US$90,000.00.
The beans were roasted at Nestle Nespresso facilities in Avenches and nearby Orbe, Switzerland. With approximately 20% lost during the roasting process, the result was approximately 180,000 capsules per ton- 3,240,000 limited edition Cafecito de Cuba capsules (approximately 5 to 6 grams each or .17 to .21 ounces). The price for a limited-edition capsule was approximately US$1.10, so potential total revenue could be approximately US$3,564,000.00.
Nestle Nespresso USA, Inc., obtained additional green coffee beans from the 2016-2017 harvest in the Republic of Cuba and continues to produce capsules for distribution throughout the world, including in the United States.
Coffee beans from the Republic of Cuba could also become an ingredient for infused ice creams: Oakland, California-based Dreyer’s Grand Ice Cream Holdings, Inc., and Oakland, California-based Edy’s Grand Ice Cream are wholly-owned by Nestle SA; and Oakland, California-based Haagen-Dazs is distributed by Nestle SA.
Nestle SA is positioning itself to be an importer to the United States of confections, coffee, ice cream, beverages, and other consumables sourced in the Republic of Cuba.
Nestle SA has a multi-decade interest in the Republic of Cuba. The company has a representative office in the city of Havana. Since the 1990's, Nestle S.A. has been involved with Republic of Cuba government-operated companies to develop the confection industry (a twenty-year joint venture producing ice cream); has investments in bottled water production (Ciego Montero) and beverage production; and imports products for sale at retail stores. In 2014, Nestle Nespresso released “Limited Edition Cubanía; Inspired by the passion and intensity of Cuban coffee ritual” that did not contain coffee from the Republic of Cuba. In 2016, "Cuban Nespresso Grand Cru Cafecito de Cuba" capsule (which would include coffee from the Republic of Cuba) was to be available outside of the United States, but with the 22 April 2016 changes in United States regulations, the opportunity was created to add the United States to global distribution channels.
In 2017, Nestle SA reported the company would invest approximately US$55 million to create a joint venture (of which it will own 51%) potentially employing 300 Republic of Cuba nationals to source ingredients for and to produce coffee, biscuits and cooking products. Completion date is by 2019. Other Nestle SA production facilities are being considered for expansion.