Long- and short-term finance from Triodos funds to the Peruvian cooperative Norandino and its coffee cooperatives secures enduring income for small-scale farmers and sets an example for eco-friendly coffee plantation renovation.

Cooperativa Norandino (Norandino) is a savings and loans cooperative with a core focus on the agricultural sector in rural areas of northeast Peru where access to finance is limited. The cooperative was founded in 2005 by three organic and fair trade coffee producers’ cooperatives, with the aim to offer much-needed financial products and services to their members. Norandino currently serves around 9,000 members, predominantly individual small-scale growers of organic and fair trade coffee, as well as cocoa, sugar cane, fruits, rice, honey and corn.

Critical need for renovation of coffee plantations

For many of these growers, coffee is the main crop, and therefore their main source of income. One of the biggest threats that coffee farmers currently face is the coffee leaf rust disease, which can affect current yields and likely subsequent harvests. To address this urgency, renovation of coffee plantations is critical. The biggest challenge for small-scale coffee farmers with regard to renovating their coffee plantations is that it will take more than three years before they can harvest and thus earn any income again. The long-term finance provided by Hivos-Triodos Fund to Norandino bridges that gap. It stimulates small-scale farmers to renovate and helps them to manage their coffee plantation efficiently. Fifty per cent of this loan will be used for renovation of coffee plants with new, rust disease-resistant varieties; the remaining loan amount is used for the regular agricultural and rural commerce loans that Norandino provides to its members.

Income continuity

Estefanía Matesanz Medina, Investment Officer for Latin America at Triodos Investment Management: "It is an innovative project with a strong focus on sustainable agricultural practices. With this long-term finance, Hivos-Triodos Fund expands its agricultural value chain investment activities, which is one of the pillars of the fund’s strategy."

Norandino has been a contact of Triodos Investment Management through the short-term trade finance loans provided by Triodos Sustainable Trade Fund to the coffee cooperatives Cenfrocafé, Oro Verde and Sol y Café. Eliane Augareils, Investment Officer for Triodos Sustainable Trade Fund: "The short-term loans by Triodos Sustainable Trade Fund enable the cooperatives to pay the coffee farmers immediately and fairly upon delivery of their produce, and to build up long-term relationships with international buyers. I’m very happy that with the with the renovation loans, we can support the farmers in the longer term, strengthening the continuity of their main source of income."