Café Kivu is a Congolese coffee company aiming to create and capture more of the value of coffee at its origin, by sourcing beans from the northeast Kivu region of DRC, then roasting and packaging them at their facility in the regional city of Goma. Of recent, fair trade has increased coffee value primarily in the export of raw beans, creating increased value addition. Café Kivu estimates that approximately $0.86 of every dollar of coffee sold to consumers worldwide is generated outside the country of origin.
In 2020, with funding from PREO, Café Kivu set out to test the economic and financial viability of replacing a gas-powered coffee roaster with an electric roaster powered by a solar plant. By the end of the pilot, in December 2022, the transition had enabled Café Kivu to scale their production, whilst reducing roasting energy costs by 64%. By providing more finely calibrated control of the roasting process, the electric roaster has also enabled the company to significantly improve their coffee’s quality, further enhancing their brand and market recognition. Café Kivu’s pioneering transition has paved the way for other local coffee manufacturers in the region to explore more sustainable solar-powered production.
Despite significant operational challenges and a complex business environment exacerbated by the Covid-19 pandemic, the Nyiragongo volcanic eruption, and ongoing armed conflict within the region, Café Kivu has shown tremendous resilience in their ability to continue sourcing and processing high-quality coffee in eastern DRC. Looking ahead, the coffee production company is exploring plans to enable local consumers to enjoy their produce at affordable prices, as well as building sales internationally in Western markets (US & UK).
PREO interviewed Aaron Wolcott, CEO at Café Kivu, to learn about their experiences and capture some of the key lessons learned.
Q. Tell us more about Café Kivu and what motivated your shift to an electric roaster.
Cafe Kivu is a boutique coffee roasting company that has been operating in Eastern DRC since 2015. We purchase green coffee from local coffee producer cooperatives with a strong track record for promoting sustainable and environmentally friendly farming in North Kivu province. We then roast and package the coffee for sale in both local and international markets. Café Kivu boasts superior product quality and a valuable regional distribution network that allows us to implement a ‘route to consumer’ distribution strategy across East and Central Africa.
When we first moved to Goma, we rented a gas-powered roaster which was both costly and polluting. With no real electricity grid in place, fuel in Eastern DRC is amongst the most expensive in Africa. Given we were focussed on scaling up production, the gas-powered equipment could no longer meet our need to produce consistently high-quality coffee in larger volumes. So, we decided to partner with Nuru Sarl (a renewable energy company dedicated to enhancing connectivity in the DRC) to secure a cost-effective source of clean energy for future production.
From 2020 to 2022, thanks to the grant from PREO, we set up a new office and roasting facility in Goma for which we purchased a Giesen 6WE electric roaster. As well as improving the quality of our coffee, the electric roaster has enabled us to lower our overall operating costs, as well as to reduce the amount of smoke, odour and dust emitted during the roasting process.
Q. Do you think electric roasting will prove transformative for the coffee processing industry in the Goma region and more broadly in DRC?
The use of an electric roaster operating on solar energy, is a first for the local coffee industry, meaning Cafe Kivu is setting the standard for Congolese coffee beans roasted at origin. As we extend our reach both nationally and internationally, it is hoped that electric roasting will become increasingly popular among other local coffee producers. Given the country’s poor electrification rates, off-grid solutions are becoming a necessity.
Q. The project contended with a variety of challenges from the outset. Can you describe some of the challenges faced and how Café Kivu adapted to them?
We first experienced two major external challenges, the restrictions on movement caused by the Covid-19 pandemic and the explosion of the Nyamulagira volcano about 15km north of Goma on May 29th 2021. Both events caused major supply chain disruptions throughout 2020 and much of 2021.
Even putting such exceptional circumstances aside, DRC is a difficult market for businesses and importing equipment proved to be highly challenging. It took months to establish a transporter who was willing to carry the electric roaster from Europe to Goma, and even when ready for shipment, the transporter opted to send the machinery by sea instead of airfreight, as formerly agreed. This led to further delays and when the equipment finally arrived, the roaster had been damaged on route. The transporter agreed to replace the broken parts, but we had to wait a further six months for the new parts to arrive. Inevitably, getting production to the desired level took much longer than we had expected.
Despite the roaster being fully operational, we still faced challenges getting our finished product to markets within and outside of DRC. This is partly due to local corruption and excessively complicated administrative procedures, which held up both our green coffee supplies and certification for exporting our coffee once roasted.
Further complications arose from the resurgence of armed rebellion groups causing insecurity and instability in North Kivu since May 2022. The groups have cut off all supply routes to Goma from the northern part of the province where we typically source our coffee. The conflict has forced many businesses in Goma to shut for weeks at a time or significantly reduce opening hours due to protests. To lessen the impact and ensure business continuity, we kept in contact with our clients during the closures whilst sourcing coffee from other areas which remain free from conflict.
To succeed in such a trying environment, we learned to be extremely adaptable and flexible in our approach. For example, whilst waiting for the electric roaster, we made do with the gas-powered roaster when we first arrived in Goma so we could continue to grow our sales. Whilst we successfully overcame the logistical challenges on the production side, sales have remained a struggle in parts of the country where we don’t have a physical presence such as Kinshasa. However, we intend to maintain our flexible approach by iterating new commercial strategies to find an effective way of penetrating these markets.
Q. Despite these challenges, the project has demonstrated strong progress. What are some of the key achievements?
Cafe Kivu is passionate about making quality Congolese coffee widely available around the world, so the fact that we have persisted in the face of such adversities is a testament to our commitment to helping to build a new future for Congolese coffee. Since moving the company to Goma, we are proud to have grown our monthly sales from almost nothing to over $2,500 each month. This revenue has enabled us to train staff on the job in general management and sales, as well as improve roasting techniques..
Purchasing the Giesen 6WE electric roaster has been transformative for our company. Firstly, the new roaster has significantly decreased the cost of energy for roasting. With the gas roaster, we spent $1.05 in gas per kilogram roasted. With the electric machine connected to Nuru’s solar energy grid, this amount has decreased to $0.30 to $0.35 depending on the number of roasts we do per day. Given the fluctuations in coffee price over the last few years, this reduction in costs has been enormously helpful. Moreover, given the CAPEX investment for the roaster amounting to $32,000, the payback period is calculated at three years, making the roaster a sensible investment.
Furthermore, the gas-powered roaster did not allow us to track the bean temperatures and required a significant amount of manual manipulation to get the roast right. With the electric roaster, we are now able to monitor roast duration, drum speed, air flow and bean temperature in a way that assures us that we can achieve a standard roast each time we roast our coffee beans. This has in turn enabled us to give our staff better training on the intricacies of producing high-quality roasted beans. Such skills will stand them in good stead for many years to come.
We have also been able to build a much stronger relationship with the cooperatives of farmers where our coffee is grown. The cooperatives that we purchase from are certified Fairtrade and organic suppliers, for which we pay a premium, but we welcome the fact that this value is going to the farmers themselves. Additionally, we help promote the quality of the coffee on an international level which is important for the cooperatives and farmers.
The deployment of renewable energy has also made our brand more distinct: few coffee companies in the region are doing this and we are certainly the only company currently in DRC. Our hope is that we can set a trend around sustainability that new coffee companies will then follow.
Q. What learnings can other companies and the wider sector take from this project?
There are several key learnings that we are happy to share for the benefit of other players in the sector.
For a company operating in DRC, learning to anticipate and manage the constraints around supply chains is crucial to achieving financial viability. It usually takes double if not triple the amount of time to receive equipment and supplies compared to elsewhere in Africa, so it’s important that enough time is built into the project plan to allow for any delays. It has also taken us over a year to navigate the regulations and red tape around exporting to US and UK markets, but I’m pleased to say that now our coffee is available in these markets via e-commerce company Amazon. Needless to say, for companies sourcing raw materials or products within the DRC, monitoring socio-political developments that could impact supply is a must, so it is important to put contingency plans in place so the company can be resilient against regular supply chain disruption.
Government regulations can also be a major obstacle. Coffee production and distribution is overseen by different government departments: the OCC (Office Congolaise du Control), ONAPAC (national coffee and cacao regulator), the Ministry of Agriculture and the Ministry of Industry. Our advice to anyone interested in operating in this sector in DRC is to make sure they thoroughly review all the related laws and regulations and understand the implications for their business. The banking sector is also stringently regulated due to issues with money laundering in the country, which makes connecting online sales to a Congolese bank almost impossible, so we advise other companies to investigate workarounds sooner rather than later in their project journey.
We are also learning to lean into the most important elements of our story in our marketing and branding. For us, attaining and then maintaining the exceptional quality of our coffee has been a real achievement, as that is what makes our product stand out in both local and international markets. The use of renewable energy also enhances our reputation, particularly in the UK and the US, given consumers in those markets are increasingly passionate about sustainability. Our company has also been built around capturing the value of coffee at origin, so we know that comprises a compelling unique selling point too.
Q. Turning to the future, what are your plans for achieving scale-up?
In February 2023, Cafe Kivu received a bridge loan to push our product to US and European markets. We will also use this capital to build sales in Kinshasa and other parts of the DRC. The loan will allow us to show full proof of concept in the export of roasted coffee so that we can effectively engage with long-term investors. Once further investment is secured, Cafe Kivu plans to set up a coffee shop in Goma which will increase revenues for our coffee, as well as widen the employment opportunities we can offer to local communities.