Farm to cup: Indonesia’s ALKO brews plans to export blockchain coffee to China

By Guan Yu Lim contact

- Last updated on GMT

ALKO is the first in South East Asia to offer a traceability blockchain technology for coffee.   ©Getty Images
ALKO is the first in South East Asia to offer a traceability blockchain technology for coffee. ©Getty Images

Related tags: Indonesia, China, Coffee, blockchain

Indonesia-based cooperative Alko Sumatra Kopi (ALKO) intends to export 100 tonnes of specialty-grade Arabica Kerinci coffee to China this year, paired with its blockchain technology.

Historically, China has been a tea drinking country, and while coffee consumption remains small, has been increasing over the years.

According to Daxue Consulting, per capita coffee consumption in China was 6.2 cups in 2018, raising to 7.2 cups in 2019.

In 2018, China imported some 84,000 tons of coffee beans in 2018. Its main imports come from Vietnam, Indonesia, Malaysia, Brazil, and US.

Despite the smaller coffee market compared to tea, it is a competitive space in China. ALKO’s CEO, Suryono Bagas Tani told FoodNavigator-Asia​ he will focus on specialty coffee which is the highest grade available.

Specialty beans have to be of single origin, have fewer than three defects, with a maximum of 5% above and below the specified screen size.

We hope that the quality of our specialty coffee can stand out, and with our blockchain technology, customers can appreciate the journey from the farm to their cup and have more trust in the product​. Hopefully, coffee will become as popular as tea in the future​.”

ALKO manages some 600 coffee farmers around the Mount Kerinci area in Indonesia, helping them export their products.

Currently 95% of ALKO’s coffee beans are exported to New Zealand, US, UK, Europe, Japan, Malaysia, Russia, and UAE. Only 5% are supplied to local buyers.

Most of ALKO’s buyers are roasteries, cafes, coffee chains, and supermarkets.

It can be found in supermarkets in Japan, cafes in France, speciality coffee companies (Anonymous Coffee in the UK), Starbucks in US, and coffee importers such as Nordic Approach in Norway.

Last year, ALKO exported 350 tons of specialty-grade Arabica Kerinci coffee beans.

Blockchain technology

As demand for coffee grows, quality and authenticity increasingly becomes important, and blockchain technology is one solution.

Blockchain is currently used in other industries such as palm oil, cocoa and fresh meat.

ALKO is the first in South East Asia to offer a traceability blockchain technology for coffee.  

Its blockchain technology was developed with EMURGO in 2020, and in the form of a QR code, collects data of the farmers, plantation site, harvest day, where the beans were processed, method (natural, wet hulled, honey), roastery, even taste and aroma profile.

Data is uploaded on a system, and the QR code can be scanned at any point of the supply chain.

Currently, coffee exported to Malaysia, US, Japan, India and France incorporate the blockchain technology.

Tani said: “If there are buyers who are not satisfied with the quality of the product, now we can immediately find the root of the problem and make improvements for both farmers and roasters, creating more trust.

Blockchain is very helpful in increasing productivity and maintaining the quality of coffee beans​.”

Tani said the recent Suez canal incident saw ALKO’s last shipment to France delayed by about 14 days.

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