Starbucks, Ai Ni to turn Yunnan into coffee capital
Companies agree to set up joint venture to buy and export top-quality Arabica beans from the province
Bien Perez 16 July 2011
Starbucks, operator of the world’s biggest coffee shop chain, has formed a new joint venture in Yunnan to help develop the province as a premier coffee-growing region.
The Seattle-based company signed a memorandum of understanding on Thursday with the Ai Ni Group, a major operator of coffee farms and processing facilities in Yunnan.
The agreement is to establish a business to buy and export high-quality, locally grown Arabica coffee beans.
The joint venture, in which Starbucks will have operating control, will also run processing mills in the southwestern province, which was previously better known for its tea. Financial terms were not given.
That followed commitments made by Starbucks in November to work with the Yunnan Academy of Agricultural Sciences and the government of Puer city to help local farmers abide by responsible growing practices and develop high-quality coffee.
“Yunnan will play an important, strategic role in ensuring our long-term supply of premium coffee,” said John Culver, the president of Starbucks Coffee International, the unit overseeing the chain’s business in more than 50 countries.
Planned initiatives under the firm’s so-called Starbucks Yunnan Coffee Project include increased direct sourcing of Yunnan coffee and investment in coffee-processing facilities.
Ai Ni Group founder and chairman Liu Minghui described the new joint venture as combining “Starbucks’ global best practices and coffee expertise with Ai Ni Group’s established coffee-farming model”.
The provincial government had earlier announced plans to invest 3 billion yuan (HK$3.6 billion) to expand green bean volume by 2020 to 200,000 tonnes from the current 38,000 tonnes.
Coffee acreage will also be expanded to 100,000 hectares, from the existing 26,700 hectares, within the same period.
According to Starbucks, its purchases of Yunnan coffee have “increased approximately 20-fold” since 2007.
The company will also set up in Puer a wholly owned farmer support centre, which will provide so-called agronomy consultation services to coffee-farming communities across the mainland.
The centre will advise the Ai Ni Group on the provision of coffee seeds for Starbucks-recommended coffee varietals; offer soil management and crop production support for the group’s coffee farms; and provide technical assistance in building its coffee mill.
Culver said the initiatives in Yunnan “will help fuel our continued growth as we seek to serve customers through more than 1,500 stores we expect to have in the [mainland] market by 2015”.
As of May this year, Starbucks operated about 450 stores in 35 cities.
Strong competition is expected to come from Hong Kong-listed China Resources Enterprise, which announced in October plans to open as many as 1,000 Pacific Coffee outlets on the mainland.
1 comment:
Starbucks, Ai Ni to turn Yunnan into coffee capital
Companies agree to set up joint venture to buy and export top-quality Arabica beans from the province
Bien Perez
16 July 2011
Starbucks, operator of the world’s biggest coffee shop chain, has formed a new joint venture in Yunnan to help develop the province as a premier coffee-growing region.
The Seattle-based company signed a memorandum of understanding on Thursday with the Ai Ni Group, a major operator of coffee farms and processing facilities in Yunnan.
The agreement is to establish a business to buy and export high-quality, locally grown Arabica coffee beans.
The joint venture, in which Starbucks will have operating control, will also run processing mills in the southwestern province, which was previously better known for its tea. Financial terms were not given.
That followed commitments made by Starbucks in November to work with the Yunnan Academy of Agricultural Sciences and the government of Puer city to help local farmers abide by responsible growing practices and develop high-quality coffee.
“Yunnan will play an important, strategic role in ensuring our long-term supply of premium coffee,” said John Culver, the president of Starbucks Coffee International, the unit overseeing the chain’s business in more than 50 countries.
Planned initiatives under the firm’s so-called Starbucks Yunnan Coffee Project include increased direct sourcing of Yunnan coffee and investment in coffee-processing facilities.
Ai Ni Group founder and chairman Liu Minghui described the new joint venture as combining “Starbucks’ global best practices and coffee expertise with Ai Ni Group’s established coffee-farming model”.
The provincial government had earlier announced plans to invest 3 billion yuan (HK$3.6 billion) to expand green bean volume by 2020 to 200,000 tonnes from the current 38,000 tonnes.
Coffee acreage will also be expanded to 100,000 hectares, from the existing 26,700 hectares, within the same period.
According to Starbucks, its purchases of Yunnan coffee have “increased approximately 20-fold” since 2007.
The company will also set up in Puer a wholly owned farmer support centre, which will provide so-called agronomy consultation services to coffee-farming communities across the mainland.
The centre will advise the Ai Ni Group on the provision of coffee seeds for Starbucks-recommended coffee varietals; offer soil management and crop production support for the group’s coffee farms; and provide technical assistance in building its coffee mill.
Culver said the initiatives in Yunnan “will help fuel our continued growth as we seek to serve customers through more than 1,500 stores we expect to have in the [mainland] market by 2015”.
As of May this year, Starbucks operated about 450 stores in 35 cities.
Strong competition is expected to come from Hong Kong-listed China Resources Enterprise, which announced in October plans to open as many as 1,000 Pacific Coffee outlets on the mainland.
Post a Comment