By Enrique Stiglich, Country Director, TechnoServe Peru


I’m excited to share some news from Peru. Four weeks ago, PIMCO volunteers Jordan Dudeck and Kai Friemel arrived at TechnoServe’s Peru office to work with us on a project that could transform the country’s coffee value chain. Their time here is part of a strategic partnership where PIMCO volunteers are transferring their business skills to entrepreneurs, farmers, and ultimately communities across Latin America, while also supporting TechnoServe in its mission to promote business solutions to poverty.

Our momentum on this project has been possible, to a great extent, because of a thoughtful and thorough industry diagnostic carried out last year by three PIMCO volunteers – Gino Gabbianelli, Marissa Garcia and Victor Cabral. Their report allowed us to clearly define high-value opportunities in the Peruvian coffee sector, and thus align partners around two top priorities: agronomy training and quality improvement. According to the volunteers’ findings, if these priorities were addressed through several identified and realistic changes, 200,000 Peruvian coffee farmers could increase their combined incomes by nearly $200 million a year.

This year, Jordan and Kai are taking a deep dive into one of these opportunities: coffee quality improvement. Specifically, they are analyzing the economic viability of implementing central wet mills in a region of Peru. To provide some context, wet milling is the process where coffee is washed and the bean is separated from the “cherry.” In Peru, most wet milling is done individually by each farmer using hand-operated coffee pulpers. We believe that by centralizing the process – as TechnoServe has helped many farmer groups to do across our global coffee work– farmers could save time and significantly improve the quality of their product. However, there are multiple logistic, infrastructural and cultural challenges to centralizing the process in Peru.

The PIMCO volunteers’ main task this year is to model the economic benefits and costs of centralizing wet milling. Although this might sound like a lot of deskwork, the task actually requires significant fieldwork in order to gather the needed data. For the past few weeks, the volunteers have interviewed dozens of farmers, met with several cooperative employees, and walked long distances on the outskirts of Tingo María to better understand the logistic challenges farmers would face if the milling process was moved to a relatively distant location.

Jordan and Kai have already come up with a first version of their economic models, and we will refine these and prepare a short presentation to share the findings with our partners. As straightforward as it might seem, I am confident that this analysis will be an eye-opener for many stakeholders, stirring up new conversations in an industry that is abundant in problems and ideas, but lacking in data and analysis. And we have the PIMCO volunteer program to thank for it.