As Filipinos crave more for local java, Philippine coffee farms brew a plan

In the Philippines—Southeast Asia’s top coffee-drinking nation—local coffee beans used to come in cheap plastic bags either stapled or bound with tape. Some vendors would also use small cotton sacks or cheesecloth tied with twine. But that has drastically changed over the past three years.

Now, Philippine beans are dropped into valve-sealed bags or airtight canisters sporting information such as tasting notes and roast dates. Then, there are details about the mountainside where the beans originated, the harvest, and the roasting process. Some packages even carry illustrations of coffee equipment or have intricate drawings of coffee plants. Brand logos are sleekly designed and the colour palettes are selected with care.

But when it comes to bean sourcing, coffee roasters keep their supply chains a secret. They get farms to sign non-disclosure agreements so that competitors do not find out their source.

The Philippines’ coffee market was divided: while low-income consumers would drink homegrown coffee, connoisseurs with more disposable income had branded coffee, mostly imported from Vietnam . But thanks to a department of agriculture (DA) campaign , local coffee is seeing its status rise. The Philippines’ coffee drinkers with higher income are now gravitating towards domestically cultivated beans, with its consumption growing 22% each year from 2016 to 2021.

Farms and suppliers are capitalising on this coffee renaissance, which began in the late 2010s. Domestic production had been declining since 2010, but that was reversed around 2017 when Filipinos began seeking out local coffee.

Now, demand for Philippine coffee is growing 14% on average each year, with per capita consumption set to rise by 29% by 2025. This climb isn’t just driven by local coffee drinkers. Coffee shops and artisan coffee roasters such as Blue Bottle are also incorporating more Philippine beans on their menus.

Farmers like Arnold Abear, who runs plantations and farms that grow coffee beans for food-and-beverage company Nestlé and local roasters, are learning to taste and profile coffee like trained experts. They have transformed their farming practices to match the Filipino coffee aficionado’s palate—one that’s more refined and selective.

“‘Floral scent’, ‘nutty taste’, ‘washed beans’, ‘dry-cured beans’. I didn’t know those words 10 years ago. But they’re part of my work now,” he told The Ken.

But local coffee growers can’t produce enough to meet the current demand. So, a new crop of farming practices is improving yields. It was only in 2019 that there was a net increase in coffee production after nine consecutive years of decline. Farms have increased their harvest sizes by using new regenerative agriculture practices, which also enable farmers to sell their beans at much higher prices. This growth has prompted the DA to make generous production and demand forecasts.

This coffee renaissance is mostly taking place in urbanised island groups like Luzon, but there are ramifications even thousands of kilometres away, where coffee farms are being transformed.

Energy boost

Abear drinks seven cups of coffee a day.

The 43-year-old farmer starts work at 5 a.m., two hours before the other farmers who work on his plantation arrive.
His team has been clearing fallen stems, stray cherries, and piles of baskets and sacks left from the harvest season that ended in April. Abear’s farmers have also been fertilising the coffee trees to help them recover, he told The Ken.

Abear began implementing new farming practices in 2015. Since then, his farm’s yield has more than tripled.

Two practices he teaches other farmers are rejuvenating and stumping, which involve cutting off the bottom one-third of a coffee plant, along with all the main stems. This not only shortens the plant when it is replanted but also leads to rapid growth.

“Coffee plants used to be so tall that we needed ladders to reach them. After rejuvenating, they grow to just chest height. Now, I sit down to harvest,” Abear said.

Nestlé sent agronomists and farm technicians to Abear’s farms in 2014, teaching new practices such as cover cropping and quality assessment—monitoring temperature and moisture content of farms, as well as coffee cupping —that he conducted in the following year. Nestlé also provided Abear and his farmers with all the implements needed for important activities such as cross-pollination and coffee roasting.

Abear’s farm produces over 1,000 kgs of coffee beans per hectare, compared to 300 kg in 2015 and 600 kg in 2019.

The new practices “absolutely” contributed to increased yield, said Abear, who added that other farms—even non-Nestlé operations—are starting to follow suit.

In the 2010s, the Philippines only produced enough coffee to meet 15% of the demand. Now, it produces enough to cover about 42%.

“We didn’t know that we were doing ‘regenerative agriculture’. It’s almost the same as our old practices but furnished with more science and technology. Some practices change slightly because now we’re educated about nitrogen depletion, greenhouse gas, and the changing duration of seasons due to climate change.”

With a new set of techniques to deploy, Philippine coffee farms cultivated 60,000 tonnes of beans in 2019, a 71% climb in yield from 35,000 tonnes in 2018, said Pacita Juan, president of the Philippine Coffee Board Inc.—an industry body of coffee growers, millers, roasters, local governments, and agricultural lenders. By 2022, annual harvest growth was around 2.3%.

“In the 2000s, people would buy anything as long as it was imported. They’d pay higher prices or purchase lower-grade beans just to avoid local coffee. Now, people are paying extra for homegrown beans,” added Juan.

The DA is taking a page from Nestlé’s programmes and educating Philippine coffee cultivators in ways to boost yield. Even though there has been success, Abear said the reduction in farmland and coffee’s long growing cycles mean any growth in the supply still won’t catch up to demand. He believes this will be the case for another three to five years, if not a decade.

Wake-up call

Coffee can only be harvested three months each year, and improving coffee yields takes time. It takes at least two or three years before new farming techniques can show results, according to both Abear and Juan. And even though these practices are significantly increasing the quality and quantity of each harvest, there’s nothing farms can do to harvest more frequently.

As the DA is pressured to show yield increases during each quarter, the harvest cycles for coffee make progress in cultivation look slower in administrative paperwork.

“In coffee time, the DA administration changes too fast [with personnel changes every six years]. Not to say this is unfair, but that’s why crops like coconut, sugar, and rice get more attention. It’s easier to produce quick results,” said Abear, adding that even though DA programmes are structured like Nestlé’s, it’s easier to get equipment, credit, and aid from the private corporation than the government.

Juan shared a similar sentiment: “Our industry has longer harvest cycles, which makes the DA unreliable because things are replaced very quickly... private-sector players do a better job of helping farms.”

Since the coffee industry doesn’t have its own government agency—unlike sugar, coconut, or rice—farmers have no intermediary to assist them with acquiring government aid, or designing tailored programmes and processes. Farmer’s associations shoulder the burden of defining guidelines for coffee wholesale prices, labour costs, wages, and delivery routes.

“The department only acknowledges and talks to farmer associations or co-operatives, not individual farms. The DA also sets up learning sites for agriculture, where farmers like me can get certified to teach other farmers new practices, but they rarely send agronomists or technicians,” said Abear. Each time the department gains new leadership, aid programmes and the application procedures change.

“It’s like the DA is hiding in their offices, not wanting to face us,” he added.

Coffee farms end up having to rely on private entities such as Nestlé and Juan’s Philippine Coffee Board for new aid and growing practices. This places a low ceiling on the growth in cultivation because not all farms grow their coffee for Nestlé or a private buyer.

Nestlé Philippines did not respond to The Ken‘s requests for comment.

“Our production can’t catch up to Vietnam or Indonesia in my lifetime. But I’m very optimistic because there’s another way forward for us,” she added.

Seeds of change

The current demand for coffee beans from the Philippines makes them more valuable—and cultivating them is a much more profitable venture than a few years ago. They’re no longer grown for export or trade but for consumption at specialty roasters and coffee shops.

As the crop becomes more expensive and takes on artisanal status, more private coffee nurseries are also cropping up in different regions.

Groups like the Philippine Coffee Board and Nestlé have intensified their efforts to help coffee farms pivot in this direction after the industry lost a large chunk of farmland.

The Philippines only has 3,000 hectares of coffee plantations left in the Luzon island group, compared to its original 11,000 hectares—many farms were turned into commercial and residential developments such as golf courses and villages, said Juan. As a result, total production levels began to sink in 2010.

It’s a transition that is familiar around the world: a few major players have large harvests now whereas there used to be many farms, each of which produced a small amount of coffee.

With prices surging, coffee has become a more valuable crop for farmers. In 2016, the Bukidnon province—where Abear resides—and its neighbouring Sultan Kudarat province only had 1,500 coffee farmers left. Now, there are around 7,500 as more farmers return to the fold or make space on their plantations for coffee trees.

“Farmers used to leave after harvest season to find off-season jobs as fishermen, carpenters, or tour guides. But because we learned about intercropping and since coffee prices are higher, many are staying farmers year-round,” added Abear.

In 2021, the DA reclassified coffee as a high-value crop, meaning it will map out a modified roadmap, subsidies, and investment plans for the sector. It’s also more likely that a new government agency will be established to specifically oversee the Philippines’ coffee cultivation.

To encourage farmers to harvest and sell higher-quality coffee, the Philippine Coffee Board—along with roasters and shops—has created new payment schemes to incentivise artisanal growing practices.

“We introduced ‘Pick Red’, a scheme where we pay coffee farmers extra for harvesting a coffee cherry only when it’s red. It takes 3X more labour because they can’t just cut down all the tree’s cherries at once, so we pay triple the price.”

Abear added that several artisan roasters purchase beans from his farm at triple or quadruple what conglomerates like Nestlé and San Miguel pay—as long as he processes and roasts them. Farmers are also learning techniques like pulped natural processing, fermenting, and washing .

In 2022, Abear’s dried beans sold for 80 pesos (US$1.4) per kg, while his processed beans went for 190–200 pesos (US$3.4–3.6) per kg.

Abear and Juan both said it would be more profitable and sustainable if the Philippines grew enough coffee to address domestic demand first—a milestone the DA hopes to reach in 2023—rather than try to create a coffee-export industry.

With only 113,000 hectares of coffee farms, the Philippines is unlikely to reach the same production levels as Vietnam, which is growing coffee on 710,000 hectares. But, Philippine farms can capitalise on the nation’s coffee-drinking culture and the citizens’ newfound love for homegrown coffee. By positioning themselves as niche, specialty producers, local farms can triple profits and continue to attract attention at coffee-tasting competitions and from artisan roasters.