Nicaragua has recovered relatively well from a recent La Roya outbreak, though climate change and insufficient practices drive further R&R need

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R&R Need

~45% of total land is in need of R&R

SHF land in R&R need

‘000 hectares

65,000 ha No need
51,000 ha R&R need

The main drivers are disease (Nicaragua was hit by La Roya), bad current practices and old trees in some areas. Climate change could potentially also affect Nicaragua severely.

Current SHF yield & potential uplift

Tons per hectare

Current yield
Target yield

Uplift potential


Though yields are low, SHFs are too few to drive total supply

Potential increase in supply


Total national supply could increase ~5-10% if R&R and GAP is implemented on all SHF land in need of R&R2

(1) The current yield is calculated on the basis of SHF production divided by SHF land area in 2014, the potential yield uplift comes from the GCP study on Nicaragua: GCP, Nicaragua: GCP: Economic Viability of Coffee farming, 2017 – this study cites an average SHF yield of 10.2qq/mz;
(2) Rounded to the nearest 5%, estimate assumes that R&R and GAP increase yields with 35%, and the range reflects a 25A-100% R&R success rate. Sources: FAOstat, Coffee production and land under coffee, 2014; ICO production statistics

Other Viability Considerations

  • Less than 2% of the production is currently in Robusta, but private sector investments expect to increase production of Robusta by 30% in 2017/18.
  • Farmers receive ~68% of the export price and the supply chain involves a number of intermediaries – there is room for increasing supply chain efficiency and SHF share of export price.
  • Nicaraguan coffee is well placed to qualify as specialty coffee. However, farmers are not currently incentivized to invest in quality improvements as they are unable to capture the associated premium.

Farmer Segmentation

SHFs represent ~40% of total production

  1. Large & medium farmers
  2. Commercial farmers in tight value chains
  3. Commercial farmers in loose value chains
  4. Disconnected farmers

National production is dominated by larger farms (>14hectares)

SHFs1 are predominately in loose value chains,relying on several middlemen to get to market.

# SHFs



(<1% of global SHFs2)

# SHF land

‘000 hectares


(~60% of national land) – average farm size ~1.5-2.5 ha)

# SHF production

‘000 hectares


(~40% of national production)

Assessment of SHF orgs.

Coops are not dominant – export around 20% ofcoffee in 2012/2013SHFs most often rely on middlemen to sell theircoffee.

Links to market C

ECOM is dominant in the country and hasclose links to SHFs

(1) SHFs in Nicaragua are sometimes referred to as farms up to 14 hectares – we focus on SHFs with <3 hectares in farm size.
(2) Assuming a global SHF population of 20 million – estimates of farmers are high-level only and vary significantly. Source: GCP, Nicaragua: GCP: Economic Viability of Coffee farming, 2017; FAOstat, Coffee production and land under coffee, 2014; ICO production statistics; USDA, Nicaragua Coffee Annual Report, 2017;

Enabling Environment for R&R

  • Coffee share of GDP: N/A [Coffee share of exports: 8.3%(2015)]
  • Liberal coffee economy: no coffee institute or board, 3traders dominate the market (ECOM, Olam, Mercom).
  • Tax income for coffee has been left in a fund because there is no disbursement rules.
  • Nicaragua has good seedling facilities that provide seeds for the whole region (Honduras, Guatemala, El Salvador) for the 1T1B program (Starbucks). Nicaragua has the 1stprivate lab for seedlings (CIRAT and ECOM).
  • Low availability of finance and limited presence of local banks in the R&R market (long term debt).
  • Farmers connected to ECOM has relied on financing via their replanting programs (not just SHFs).
  • SHFs lack access to training programs and there is alack of public extension service officers.

Examples of R&R programs

Past R&R programs have largely focused on renovation in response to La Roya

Root Capital, USAID, Keurig, Starbucks – Coffee Farmer Resilience Initiative

USD 3.5 million in loans to a local coop for SHF renovation.

ECOM, Starbucks, IDB, IFC – ECOM Renovation

ECOM, in a innovative partnership with Starbucks, IFC, and IDB provided renovation loans to Nicaraguan farmers.

Catholic Service Relief, CIAT – Rust to Resilience

Renovation program to help farmers overcome La Roya.

Learn more and get involved

There is a lot of work to be done to ensure the long-term supply of coffee from countries where the crop has long shaped the social and economic fabric. Learning to extend the life of their trees and improve yields helps farmers stabilize annual production and in turn, income, while the rest of the world benefits from a steady supply of quality coffee. Continue on to learn more about the immediate attention and action that is required to make this a reality.