Project Description

Sangany Café aims to improve Robusta coffee production and quality in Madagascar, targeting European and domestic markets for high-quality green, roasted and wet-processed coffee. The main activities include improving production, processing and marketing of Robusta coffee (inter)nationally, benefitting 10,000 farmers. Main shareholders of Sangany Café are Fair and Sustainable Participations BV, the Netherlands, and HERi Africa GmbH, Germany.

Projections of the project are based on a detailed analysis conducted in the field regarding coffee production and commercialization, level of access by farmers to fair credit and improved technologies and product and market diversification. Coffee quality needs to be improved to enable access to export markets.

Current Status

The finalization and formal registration of all relevant documents for the CFC financed intervention took considerable time. The first disbursement of the CFC loan, an amount of USD 230,000, was made in July 2016. In the course of 2016, Sangany succeeded in attracting a new shareholder, ZITAL SA based in Madagascar. Furthermore, Sangany Café merged with Sangany Spices to make more efficient use of resources to increase production and improve quality of the traditional export crops in south-eastern Madagascar, targeting the same farmers who grow both coffee and spices. A partnership has been developed with the MFI CECAM, which offers credit to smallholders. These credits are guaranteed by delivery contracts to Sangany. A partnership with providers of mobile payment systems has been established for quick, reliable, fast and safe payment after delivery, linking the payment system to Sangany’s financial planning and monitoring system allowing efficient control and supervision of collection points and field staff.

Sangany has set-up fully equipped collection points in the main production areas (warehouse, balances, humidity meters, computerized management system). Additional investments in buildings and equipment is expected to be made in 2017. In the coffee sector Sangany works towards achieving the criteria of the 4C Association and obtaining UTZ certification. In the spice sector Sangany is applying the Sustainable Agricultural Code promoted by Unilever. An updated business plan for the period 2017-2021 has been prepared focusing on the sustainable development of the coffee and spice chains. The volume of collected coffee is expected to increase from approximately 300 tons in 2016 to 2.000 tons in 2022. In 2021, Sangany will handle at least 600 tons of cloves and 100 tons of pepper. Sangany will collaborate, directly or through farmers’ organizations, with more than 10.000 smallholders. With the increase of volumes handled by Sangany additional jobs are expected to be created.

PROJECT OVERVIEW
Organization: Sangany Café Project: CFC/2014/04/0064
Country: Madagascar Commodity: Coffee
Total Cost: USD 2,336,000 CFC Financing: USD 1,078,000 (Loan of which USD 500,000 financed by OFID and USD 375,000 by the Dutch Trust Fund)



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