From Opium to Coffee in Laos

The remote mountainous area of Laos is well-known for its diversity in ethnic minority groups, living as peaceful hill tribes. These include the Hmong group, who have brought opium production in the early 19th century from China to Laos and popularized it there. Due to weak infrastructure, the mountainous region is often difficult to access and hardly connected to local markets. Agricultural production is often limited to the production of food for own consumption. The cultivation of market crops is hardly worthwhile since there are either no adequate transport routes, or the transport costs are just disproportionately too high compared to the benefits gained from the sale of these crops. Growing and marketing fresh goods and products that must be transported in large quantities are therefore not an option. For farmers, opium has the advantage of having high value in small quantities plus it can also be stored longer (i.e. it does not have to be sold immediately after harvest).

The simple ban on opium without offering alternatives drives the already precarious situation of mountain farmers into a state of even greater poverty. An alternative crop to opium needs to have similar advantages as opium; a rather high value in small quantities, value added through local processing, storability and suitability for the soil and climate of the region. As such, coffee was identified to be a promising alternative crop to opium in Laos.

Formation of the VANMAI Coffee Cooperative

In 2015, UNODC started to introduce coffee as a cash crop to 12 villages in 4 districts of the Huapan province in the north of Laos. UNODC supported all technical aspects of coffee production but quickly realized that organizing a total of more than 330 families in a group working together is a big challenge; in particular if the families are spread over 12 villages in 4 districts, composed of different ethnic groups. As a result, in 2017, UNODC looked for a partnership with DGRV Laos and its partner DRDC.

In order to build up the individual families to a group, DGRV organized trainings, study-tours in Laos and abroad and an internship for the group management in experienced coffee cooperatives in Laos and Thailand. These measures, completed through intensive coaching, finally led to the formal registration of the VANMAI Coffee Producer Cooperative in 2019. The cooperative is now able to produce high quality coffee and end of 2020, a contract with an international company for the export of VANMAI coffee to Europe could be signed. With the planned transformation in organic coffee and fair trade, the cooperative will get sustainable markets, fetch higher prices and increase the family income of their members. In addition, the cooperative member families benefit also from trainings organized by their cooperative that are not directly related to coffee production, for example financial literacy.

Challenges and Opportunities ahead

There are still many challenges but without being organized in a group/cooperative, the individual farmers would neither have access to all support and extension services, nor have the access to an international market. The VANMAI Cooperative now serves as a model on the formation of a cooperative also in rather difficult circumstances, and as a good example on the benefit of cooperation with other partners. UNODC has the technical and financial means related to coffee production and processing. DGRV contributes with its expertise in cooperative development and its respectable network including relevant government partners. Thus, if all partners bring in their specific expertise, complement each other with their expertise and bundle their resources together, all concerned parties will benefit. Ultimately, this is what cooperative means: to cooperate!

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