establishing a viable "hobby farm" and micro-business

[Genebe]

From reading some of the threads here, I’m sure there are people that could offer some good advice and perspective on this idea.

I’m not sure how unique my “coffee situation” is, but it’s certainly one that (to me) seems to have some potential.

My wife grew up near Boquete, Panama, and her family still lives all around the area. This area seems to be a little “Napa Valley” for coffee production in Panama.
Some of her close relatives own several small plots of land in the mountain area and grow a variety of crops there, including some coffee (not in commercial quantities, but just for personal use). Her father is a retired foreman of a banana plantation and now spends his time trying to find things to do, especially in the garden. He’s a very intelligent man & was successful in agriculture and managing a major farm, but isn’t familiar with growing coffee (beyond what his family has done in their home gardens).

My wife & I have always intended to purchase some property in the mountain areas and build a vacation home. The other day, we were discussing the possibility of getting enough land to operate a “hobby farm”, which would also thrill her father because he’d have something to do. Well, the topic of what to grow came up, and bananas and pineapple seem to perishable of a crop (and difficult to do on a small scale). We both like the idea of coffee. It seems like an area where a quality micro-grow would be feasible.

Because we both still live & work in the U.S., we also like the idea of being able to import our own crops (in very small quantities, i.e. a few pounds) for our personal use, and also had the idea of eventually growing this a little larger and distributing our product to a few specialty coffee shops in the U.S., or even starting one of our own (which our daughter might be interested in running when she gets out of college). Of course, that’s all far-reaching dreams and ideas, but financially possible for us. We’re several years away from retiring, but it would be nice to start something now so that it’s a little more established when we are able to start spending extended vacations down there. I know that coffee plants, just like grapes, take a few years to bear fruit.

Right now, we have access to land that is suitable for growing, and have started looking for more that would be appropriate (altitude, soil, shade, water, access to utilities, etc.) for (1) building our winter home, (2) starting our hobby farm, (3) wouldn’t be landlocked for future expansion, if we decided. We also have an experienced ag foreman who will work for free, and access to local laborers when we need them.

To top it off, I’ve spend 18 years working for the U.S. border services, and although I’m not in the agricultural inspections or import areas, I have many friends and co-worker contacts who are. It will not be difficult for me to learn how to import.

If anyone has done anything similar, in whole or part, I’d love to hear of your experiences and suggestions.

 

[Genebe]

Well I can see this is going to be a blind experience! lol!

 

[ensoluna]

Well I can see this is going to be a blind experience! lol!

My name is Alex and I work at Ensoluna S.A. in Guatemala. We have couple of our farms and a specialty coffee exporting company, located in Quetzaltenango, Guatemala.

Perhaps, I can give you some information.
Before I start, can I ask you how much of land (acres) do you have in Panama and what is the exact altitude, climate and soil like?

First, if you are bring some pounds of coffee for your personal use, it got to be “hand-carry” in your suitcase, not by any other transportation due to freight charges. I am sure that you already know about this.

Secondly, if you are thinking of making some sort of business out of your farm, it gets much more complicated. I am not so sure exactly how big of land you have for coffee, but the most feasible way of importing coffee beans is to import by 20’ container. (as example, it costs us $1300.00 from Guatemala to Los Angeles port). There is 41,000 lbs of café oro in 20’ container. One coffee tree produce about 1 lb of café oro. That means you need about 41,000 coffee trees to fill one container. In order to plant 41K trees, you need about 80 to 100 acres of land.

So, if your land is about 5 acres (let’s assume since you said micro farm, perhaps it could be even smaller), that will produce about 2000 lbs of café oro in 3 to 4 years of time. Right now, café oro from Panama (normal commercial coffee) is about $2.20 per lbs. That translate to only $4400.00 worth of your coffee. From this $4400.00, you need to pay for the labors, fertilizers for coffee, chemicals to maintain the coffee trees, cost of beneficio humedo & seco, buying sacos, export license…etc Probably you will be negative in profits.

But let’s say that there is absolutely no cost for you and everything is done automatically and magically done. So If you bring $4400 worth of your coffee to USA and plan to sell for profits, your cost of green coffee will be much higher (at least double) than any other green coffee importers because the expenses of bring your coffee into USA (freights, duties, in-land freights, other related charges) will be too much for the amount of coffee.

I do not want to write too much (but already did, sorry), but if you need more information, just let me know. Or email me at [email protected]
Thanks and hope that everything works out for you great in Panama.

 

[ensoluna]

oh, I forgot to tell you one thing.
it will cost you between $0.60 to $1.10 for one baby coffee tree. for 5 acres farm, you need to buy about 2000 of them. let's say the cost of plant is $1500.00 plus you need to hire people to actually plant them in your farm. that will cost you money. you need to make water system to water them and fertilize them...etc until they become strong enough. everything will cost you money.

also, it needs shades. either you need to plant banana trees, avocado or orange trees, depends on the altitude, weather and soil conditions. again, Money!.

after 3 years, you will see the first harvest.

 

[Genebe]

Thanks Alex! That's exactly the kind of information I was looking for!

It sounds like I'll need to keep this a local thing, because of the importation costs. That's ok, and I still believe we can make this work, but on a different level.

 

[ensoluna]

no problem.
i am glad that I can help you.
i work in the coffee origin side of business for a long time and we also have our own farms (150 acres and 120 acres), so I know exactly what it takes to run a coffee farm. Also, since we are in the business of green coffee exportation, i also know the cost of transportation, distribution..etc.

anyway, glad to be of your service.