9 tips on how to go digital in the coffee sector

The use of technology is increasing across the entire coffee supply chain. Systems and platforms are being developed to make coffee trade more efficient and transparent. Technology is supporting better traceability, farm monitoring and farmer payments. Digitalisation can even help with testing coffee quality, validating origins and giving buyers virtual experiences. In this study we share practical tips on how digitalisation plays a role in the coffee sector and what this could mean for you. 

1. Understand the level of digitalisation that works for you 

European coffee buyers are demanding more and more information about the origin of the product. They want to know that the coffee they buy is consistent in quality and meets traceability requirements. Many buyers also want assurance that the coffee is ethically and sustainably sourced. By integrating digital tools in your business, you can provide assurance that you can meet these demands.

In addition, you can use digital tools to monitor internal processes. By collecting accurate information about your business, you can track activities on farm, control the internal management system, connect with producers and producers’ groups, and monitor sales and accounting practices. With digital tools, you can also connect and compare information from different parts of the coffee supply chain to identify which areas need improvement.

There are many ways to benefit from working more digitally in the coffee sector. There are also many different tools to choose from. These range from simple tools to more complex technology using AI or blockchain. They can apply to a specific part of your business or solve a range of issues such as buying and selling, quality control, traceability, digital payments, and farming practices. Before choosing the digital tool or strategy that works best for you, it is important to consider what you want to accomplish. It is also important to assess your current level of digitalisation. 

Determine your current level of digitalisation

When selecting a tool, it is important to ask if these tools can be used in your organisation. For some tools, the users will need to have more digital knowledge than others. Consider questions such as:

• Which digital tools are you already using? 
• What is the current level of digital skills of your employees (the people that will use the tools)?
• Who are the main users of digital tools in your organisation right now? Will they also be the main users of any new tools, or will these be other people in your organisation?

These steps will help you assess how ready your organisation is for new digital tools. They will also help determine what is needed when a tool is selected. New users might need extra training, or new people might need to be hired. 

Determine where digital tools can help you improve the most

Next, look closely at where a digital tool can help you the most. Think about your main challenges or needs. Developing a process map of your operation can help to identify these needs. For example, the biggest need for some exporters might be mapping the coffee farms and production zones you source from. For other exporters, this might be improvements further down the supply chain, such as traceability or coffee quality control. 

There are many types of digital tools to choose from. Some examples are:

• Tools to improve coffee production. 
• Traceability tools.
• Mapping, monitoring and remote sensing.
• Sales platforms/digital buying. 
• E-commerce platforms.
• New technologies such as AI, drones, Internet of Things, blockchain.

Select the digital tools that are right for your organisation

95% of the global population is covered by broadband internet. However, 3 billion people do not use internet services because they cannot afford it or lack the digital skills to use it. This includes many coffee farmers. In these cases, a simple tool might be the best solution. 

Consider how demanding new tools are. If there is a big step up in digitisation, it might be better to take a smaller step first. For example, if you operate on paper-based traceability, it might not make sense to go straight to full block-chain traceability. A simpler, off-the-shelf solution might be a better choice. In some cases, a simple Excel-based administration makes more sense as a first step. 

Consider multiple user cases the tool can support with

It is important to consider the wider benefits of a digital tool. Data collection is often done with one objective in mind. This data might, however, help you improve in other areas as well. It is therefore important to think about how the tool or data can serve multiple purposes. This can help you get more value out of your investment.

For example, as a producer you can share geolocations of the farms with your buyer for compliance with the new  EU Regulation on Deforestation-free products (EUDR). However, once you have these maps, there are other benefits beyond compliance. For example, geolocation data help to get more accurate data on expected coffee yields, weather predictions, or other ways to improve farming. 

Ensure that you own your data

Data on farmers and farms has been collected by companies, certification programmes and NGOs for many years. This includes data on household income, coffee production, good agricultural practices and many other topics. The aim of this data is to help farmers improve their production practices and their yields. However, this data is often not shared between stakeholders. Farmer data is often not owned by the farmers themselves. 

As a producer or producer group, owning your own data has many benefits. It makes it easier to sell to new buyers and it lets you use the data to improve your own business. It is important to ensure that any data that is collected about your business or coffee production is owned by your organisation. 

2. Use B2B or B2C e-Commerce platforms to sell your products 

Buying and selling coffee online is a big part of coffee digitalisation. By using digital platforms, buyers and final consumers can buy a wide range of coffee on the internet. Online selling can be done through two types of channels. These are Business-to-business (B2B) online trading and Business-to-consumer (B2C) e-commerce.

Sell your coffee on B2B Platforms

B2B online trading means selling your green coffee directly to international buyers. Users can upload the information about their coffee on the platform and inform buyers. This can give you access to buyers who might be difficult to reach with more traditional sales channels. Information typically needs to include the country of origin and specific region, quantity, price, cooperative’s name, process, grade, screen size, cupping score and certification status. 

With online B2B trading it is important to always keep the information of your coffee up to date. For exporters, this means a time investment and fast responses to buyers.

Examples of platforms are: 

• Algrano is a platform that links coffee producers directly with roasters online. It can also help with logistical and warehousing services. It is not necessary for a producer to fill an entire container. This reduces costs and gives producers more flexibility. 
• Almacena Platform is a platform that links exporters with brokers, traders, suppliers and service providers. 
• V-Hub is Vollers' digital marketplace for green coffee. Exporters can showcase their coffees and share automated offer sheets. 
• TYPICA connects coffee producers and roasters for the direct trade of small quantities of specialty coffee.
• Beyco is a coffee trading platform on blockchain. The Beyco Farmer App allows you to collect basic farm and producer data. It also allows financial solutions and access to credit lines.
• Guatemalan Coffees is a web platform where Guatemalan producers can upload their coffee offers online. The Coffee Search System does not sell coffee online but gives profiles for specific coffee growing regions. 
• M-cultivo has several services for producers, including online auctions where producers can sell their coffee. The company also partners with Cup of Excellence. 

There are also other ways to use digital platforms to promote your coffee. Many traders and platforms are now using social media, virtual cupping sessions and other virtual ways to connect with buyers. Virtual cupping sessions became more popular during the COVD-19 pandemic. This is when many physical activities moved online. One example is the CupWise Platform. This platform hosts cupping sessions online and has built a scoring system into the application. 

In the years since the pandemic, most events have now moved back to fully in-person events. Hybrid events are still organised as well. Read the CBI study on Tips to find European coffee buyers for more information about events and trade fairs.

Sell your coffee on B2C Platforms

B2C platforms let companies sell coffee directly to consumers. This is mostly done with roasted coffee. It is therefore mostly relevant for companies that sell roasted coffee. For these types of companies, it could be useful to join a B2C platform to connect with consumers.

B2C e-commerce usually does not involve exporters directly. However, it is still an opportunity for consumers to learn about your coffee by buying from roasters and retailers.

Digital marketing is growing in coffee as well. More and more organisations use social media, websites, newsletters and other forms of digital promotion to inform buyers. This can also be used to promote where your coffee is available. For example, Origin Coffee Lab (Peru), La Palma & El Tucan (Colombia) and Muraho Trading Company (Rwanda) promote their coffee on social media. 

3. Explore Artificial Intelligence solutions to make your product more attractive

The importance of Artificial Intelligence (AI) in the Food and Beverage Market is estimated to grow by more than US$35 billion between 2024 and 2028. AI in the foodservice industry could enhance efficiency, reduce operational costs, and improve overall product quality. While it is not always accessible for cooperatives and SMEs, understanding what happens in this domain is important, as AI is here to stay.

AI is most relevant in the parts of the supply chain that are already using advanced technology. In the coffee sector, AI is used in several ways. For example, AI is improving technology for coffee roasting machines and equipment. But AI could also help make improvements throughout the coffee value chain. 

AI can help with evaluating coffee samples. Companies such as ProfilePrint, Agrivero, Demetria and CSmart test for coffee quality using AI technology. This reduces the subjectivity and individual bias and increases efficiency. This could also help free up resources during the harvest season. 

AI for testing quality is currently used mostly by the larger players in the coffee industry. However, for exporters it could be helpful to look at the options. It could help producers better understand the quality of their coffee and get rewarded for it with the right price. Speak with your buyers to see if they are interested in using AI to test and verify the quality of the coffee. 

AI can also help with sustainability issues in the supply chain. For example, it can help to improve traceability, reduce waste, and inform customers about the sustainability aspects of the coffee they buy. 

Another technology that is developing fast at the end of the supply chain is the use of augmented reality (AR). It can be used to tell coffee drinkers about the origin of their coffee with interactive displays. Exporters can share such stories with their buyers, to support the development of AR for their brands. 

For exporters, it is important to keep track of technological developments. It could be interesting to invest in AI. However, it is important to always consider how this impacts coffee producers. For a sustainable coffee sector, the producers also need a sustainable business. 

Smallholder farmers often do not benefit from these technological advancements. Usually, AI is developed and controlled by multinational companies. There are AI technologies that help on the production side as well. These include collecting important data for coffee production such as soil quality and temperature and models that predict yields and harvests. However, many smallholder farmers do not have the resources to invest in AI. As a result, they could lose business to more advanced coffee producers. It is important that AI is guided by an ethical code of conduct to protect human relationships, communities, culture, smallholder farmers and the environment.

Figure 1: Using technology to improve the digital experience for consumers

Source: Photo by Maddi Bazzocco on Unsplash

4. Combine remote and big data with on-the-ground data 

Big data refers to large amounts of data produced very quickly by a high number of diverse sources. Data can be created by people or by machines. It is used for machine learning projects, predictive modelling and other advanced analytics applications.

Large amounts of data are being collected in the coffee sector. In some cases, data can be classified as big data. New technology can be used to create new learnings from the data. 

Market access

Data collection is done mostly by coffee traders and roasters. However, it is now also increasing among coffee producers. Collecting and assessing data can help producers to make better decisions. For example by knowing which varieties to plant, when to process their coffees, and what type of processing method to use. 

One example is the Big Data Platform in Uganda developed by BUCADEF. The platform connects farmers with many different service providers and international markets. It gives farmers access to real-time data. The platform helps them to improve productivity, reduce waste and make their business more profitable. 

KIT has developed a machine learning tool that estimates the annual income of coffee farming households. The goal of this tool is to improve monitoring and evaluation of household income. Helping producers achieve a living wage is key for a sustainable coffee sector. Tools such as this contribute to that goal. 

Exporters can benefit from this technology by partnering with organisations specialised in big data collection and processing. Buyers can be included to share investment costs. 

Futures market and digital buying

Coffee futures are traded on the ICE exchange, with Arabica futures traded in New York and Robusta futures traded in London. There are many factors that influence the price of coffee on the futures market. These include climate, plant disease, political situations, demand and transport costs. Another factor is speculation on the price of coffee. A lot of speculation is done by computers trading on algorithms. This can cause large changes in the price. 

Coffee producers often do not benefit from speculation and volatile markets. It is important to consider how this affects producers by understanding the price that they are actually paid. Exporters can also help producers understand basic market mechanisms. Read the CBI study What is the demand for coffee from producing countries on the European market for more information.

5. Digitalise the supply chain

More and more buyers want to know that the coffee is produced sustainably. To make the coffee sector more sustainable, it is crucial to know where your coffee comes from. If you do not know where it comes from, it is not possible to make the production of the coffee you buy more sustainable. Traceability is also becoming more important for compliance with new laws and legislation. 

One of the most important is the EUDR. As part of this regulation, companies must conduct extensive diligence to ensure that the coffee they buy is not produced on land that was deforested after 31 December 2020. Companies must comply as of 30 December 2024 (with more time for SMEs). Traceability is needed to comply with this legislation. Traceability has therefore become more important than ever before.

Explore different traceability systems

Industry, governments, certification programmes, NGOs and service providers have all created their own traceability systems. Most multinational traders have an internal traceability system. Rainforest Alliance and Fairtrade also have their own systems. 

Also, many service providers have developed traceability solutions. These include Source Intelligence, Cropin, Fairfood, Farmforce, Global Forest Watch, Satelligence, Sourcemap and Trade in space. There are also coffee-specific solutions such as Beyco. 

Producing countries are also investing in traceability systems. Ecuador has developed a deforestation-free certification scheme with a digital traceability system. The Ethiopian Commodity Exchange is piloting a national traceability system that is expected to be ready in 2026. In early 2024, Uganda was seeking a loan to implement a national traceability system. Côte d’Ivoire is implementing a national traceability system for coffee and cocoa.

Having their own traceability system helps to track the coffee that they trade or certify. This gives them more assurance and control over their supply chains. This can lower risks and be a competitive advantage for the company as well. 

As a result, there is a landscape with many traceability systems. In some cases, they trace the same volumes of coffee, but they are often not linked to each other. There are many independent traceability systems that do not share data. Supply chain actors often need to use multiple systems to trace the coffee. This can make it inconvenient and confusing for users. This situation can reduce the flexibility that producers and exporters have in selling their coffee. As a producer, it is therefore important to remain in control of your own data. 

Use blockchain technology to improve traceability

Several traceability systems also use blockchain technology. Blockchain is an open system of decentralised data tracking and storage. Blockchains store data in blocks linked together via cryptography. It is used to increase accountability, transparency and traceability along the supply chain. The system requires each actor along the chain to join the blockchain technology. This allows the entire journey of coffee beans to be traced back to the origin.

Blockchain can be an important tool for being a public source or record. It is transparent, auditable and it allows innovative integrations such as carbon credits. It is also useful for mobile payments. It has been used on a small scale. For example, Moyee uses integrated blockchain technology and Fairfood has set up traceability using blockchain technology with Fairtrade Original, Ankole and Pure Africa. However, it is not required or necessary, and has not been used at scale in the coffee sector. Many current solutions without blockchain work for coffee traceability. 

The coffee sector still has large traceability gaps. Many companies are expected to still fall short of compliance in 2024. For exporters, it is important to invest in a system that provides the information that is needed for EUDR compliance. 

Invest in mapping and monitoring

The EUDR requires geolocation mapping of farm plots. GPS points are needed for plots of less than 4 hectares, and polygons for plots above 4 hectares. These plots must be compared with maps of protected areas and classified forests to ensure that the coffee is not produced illegally. They also need to be overlayed with deforestation and land change maps. This is done with monitoring and remote sensing, using Geographic Information Systems (GIS). 

The coffee sector is investing in mapping to prepare for the EUDR. A lot of work remains in 2024. Countries like Brazil, Vietnam and Uganda look to be better prepared than other countries. They already have a lot of data available and are investing in mapping and data collection. Companies are also supporting these efforts. In 2022, Olam had polygon maps for more than 235,000 farms. Neumann Kaffee Gruppe (NKG) offers up-to-date maps of coffee farms as part of its NKG Verified programme. Volcafe expects to be fully compliant with the EUDR by the end of 2024. 

Another use of remote sensing is measuring biomass on coffee farms. This technology is used by ACORN, which is part of Rabobank. ACORN works with farmer cooperatives and other local partners to help coffee farmers set up agroforestry systems. The technology allows ACORN to measure the biomass that is generated on the farm and converts this into Carbon Removal Units (CRUs). 

The approach benefits companies, farmers and the planet. The CRUs are sold to organisations for offsetting or insetting strategies. This can help them meet their climate goals. Farmers also benefit from generating CRUs. 80% of the income from CRU sales flow back to the original smallholder. The planet benefits through increased biodiversity and CO2 removal from the atmosphere.

6. Digitise payments to farmers 

Responsible purchasing practices are key to a sustainable coffee sector. This includes sustainable trading practices, long-term contracts, providing pre-finance facilities, and reducing payment periods. It also includes rewarding farmers fairly for their work. Transparent reporting on your purchasing practices can help attract more sustainability-minded buyers. 

Digital payments to farmers give a higher assurance that the payments reach the farmers. They are more secure and make it easier to create a record of the payments. Digital payments also help create income records for farmers. These can help cooperatives and farmer groups get better access to finance. 

Digital payments can also help address gender inequalities. For example, in Ethiopia, women make up 75% of the labour force. However, in coffee, women only keep 34% of the income that they generate. With digital payments, women are paid directly, giving them more control over their money and how they spend it. If combined with a traceable and transparent supply chain, your buyers can talk about the benefits to consumers. This creates extra value for your coffee. 

Examples of digital payments in the coffee sector are: 

• Agri-wallet gives supply chain actors access to finance from a global network of lenders. This includes farmers, buyers and suppliers. For farmers it means that they receive income in a digital wallet in either mobile money or tokens. The money received in the Agri-wallet can be spent on inputs such as seeds or fertilisers. 
• MyAGRO is a tool that helps farmers save money for personal financial goals. Through their mobile layaway platform, farmers can use their mobile phones to buy seeds and fertiliser. 
• Connect is a payment verification tool developed by Fairfood. Many smallholder farmers do not have a smartphone or access to the internet. With Connect, farmers receive a Farmer Card that they use to verify that they have been paid. Farmers do not need a mobile phone. The collector uses the Connect app to record the transactions. The app can also be used without access to internet, with data synchronised later. The tool can be used for product delivery, premium, bulk premium payments, deferred premium, and other payment types. 
• There are also examples of national systems using digital payments. For example, the Colombian Coffee Growers Federation (FNC) shifted payments from cash to payment cards. In Kenya, coffee growers pay their workers using the Kenyan mobile banking system M-PESA. 

Figure 2: The Farmer Cards developed by Fairfood

Source: Fairfood

7. Use digital tools to get access to financial institutions and lenders

Digital tools can help producers and exporters get access to finance. Access to finance is an important issue in coffee production. Many coffee producers need access to finance to invest in their farms or to sustain themselves between harvests. Digital tools can help producers and exporters get access to finance. 

Many Microfinance Institutions are now using digital tools in their financial service offer. For example, Apollo Agriculture is an organisation in Kenya that works with machine learning credit models. Farmers apply for financing, and the models give an instant credit decision. Farmers can then use credits to buy inputs through local dealers. Another example is Almacena Platform.

8. Use digital tools to improve farming practices

The most important part of the coffee supply chain is the production of coffee. It is therefore important to consider how tools can help improve this stage. 

Examples of digital tools to improve coffee farming practices are: 

• In Latin America, Aragro is an example of a data platform that collects and use farmer data to improve their business. The platform lets farmers visualise their farm in real-time on integrated maps. They can also help with accounting, reporting and other services. 
• Sispro Coffee (Peru) is another example of a platform that allows producers to monitor their farms and supports traceability.
• The Soilcares application provides producers with information about soil fertility on their farms. This helps them make better decisions about when to apply fertilisers. 
• Plantix is a free app that can diagnose plant diseases and describe treatments. Users take a picture of the sick crop and get a free diagnosis and treatment suggestion. 
• FarmersEdge is a platform that helps farmers become more sustainable, productive and profitable.
• The GeoFarmer app lets farmers and field operators ask questions and share best agricultural practices. 
• The Cool Farm Tool is a carbon accounting tool in which producers can track and check their carbon footprint. 
• Farmerline gives farmers access to quality inputs, training and markets through their digital platform Mergdata. The tools on this platform can be used to improve yields and income. 
• PlantwisePlus is an app that helps address plant health threats and reduce crop losses. The focus is on pest preparedness, pesticide risk reduction and farmer advice. 

Figure 3: Using digital tools for soil analysis

Source: Ruben Bergsma at Long Run Sustainability 

Using data to improve farming practices requires data ownership. Unfortunately, many farmer groups and farmers do not own the data that is collected about their farms and households. In many cases, this data is owned by one of their key buyers, who invested in the mapping but has not shared the data. 

Farmers and farmer groups need to own the data about their farms and households. This gives them more freedom in who they sell to and to explore new market opportunities. This can lead to more financial security for farmers. As an exporter, it is therefore important to share data collected from farmers with the farmers and groups that they are part of. Exporters can support producer groups in setting up the systems to store and share this data, for example by helping them with the digital tools described in this study.

Use technology to assess and improve quality 

Quality is an important buyer requirement on the European market. Coffee buyers expect quality and consistency over time and require samples that properly represent the coffee that will be shipped. 

There are many digital tools that can help with improving and monitoring coffee quality throughout the post-harvest process. Examples of tools are:

• Tastify is a coffee cupping and database management app. Any user can share their notes on coffee quality instantly on the app. The software stores sensory reports in the database of all the samples cupped. By keeping these records, you can compare information between your different coffees over time. You can also share results directly with your buyers. 
• Flowins (Brazil) is a tool for small coffee suppliers that guides them through the post-harvest process. The team also prepares physical and sensory reports on coffee samples received from suppliers. The service is currently available only in Brazil, but the company is planning to expand to other countries.

9. Work with partners that have a network or experience in your region 

Many of the technology providers mentioned in this study have a local presence or experience in producing countries. When you explore the options with a technology provider, always ask about their experience in your country or region. The local context can be very different between countries. It is crucial to learn from others if they already have some experience. 

It can also be helpful to check if they have staff based in your country. This will make it easier for them to support you in the implementation. It also gives more confidence that they understand the local context. 

Look for organisations that offer support and guidance in this process. 

• Root Capital, Rikolto and Solidaridad all support SMEs with digital solutions. They offer technical assistance and practical guidance. In some cases, they can also provide financial support. 
• The Coffee Innovation Fund financed by the German Federal Ministry for Economic Cooperation and Development (BMZ) supports projects in Western Africa and South-East Asia. The focus is on using technology to increase profitability for coffee farmers. 
• IDB Lab offers financial support for digitalisation investments, especially in Latin American countries and the Caribbean. 
• Digital Coffee Future offers training on everything related to digitalisation in coffee.

Long Run Sustainability carried out this study in partnership with Ethos Agriculture on behalf of CBI.

Please review our market information disclaimer.