Fresh Cup

June 2009

Characters in Coffee

John Darch’s work with Thai villagers, one cup at a time

Online Version: http://www.freshcup.com/featured-article.php?id=94

John Darch has been actively conducting business in Thailand for more than 20 years, but Thai coffee has not always been his beat. The hunting potash used in agricultural fertilizer is what initially brought the Canadian Darch, 61, to the land of smiles and dazzling beaches back in 1986, when he was scouting out a potential potash mine project in the north. For nearly 30 years before, Darch worked on similar natural resource projects in North America, Africa and Asia. The securing of the potash mining concession in 1992 and Darch becoming co-chairman of Asia Pacific Resources meant that he was going to be spending a fair share of his time in northeastern Thailand.

Though entrenched in Thailand, Darch’s knowledge of the scattered and isolated tribes in the northern verdant hills was scant to say the least. “Like most Western entrepreneurs in Thailand, my exposure was primarily with the established business society, in comfortable surroundings,” he says. “I was captivated by the natural beauty, rich culture, ancient history, friendly hospitality and, of course, the delicious cuisine.”

But then came the day in 2006 when Darch was introduced by a Thai friend to some of the colorful Akha hilltribe people of Doi Chaang, near the northern city of Chiang Rai, and began to interact with the Thailand that is not usually depicted on postcards. “After spending time with the Akha, their struggle for dignity was all too apparent, as was their wish to be more than just a tourist attraction,” Darch notes. Rich in culture and tradition, shrouded in myth and legend, the Akha people have no official written language but maintain a detailed oral history and live life according to the “Akha Way,” a spiritual, moral and social philosophy that governs behavior and emphasizes strong ties to land and family. Yet, of all the hilltribes, according to Darch, few in Thailand have been as downtrodden, shunned or impoverished as the Akha people.

To Darch, it was obvious that the villagers trusted that coffee agriculture was the business vehicle they needed to drive them to respect and prosperity. That coffee was even being grown in Thailand was understandably a surprise to the two-cup-a-day Darch—“never mind that the Akha coffee business was being achieved with no government assistance or donations,” he says.

In the early 1980s, wishing to discourage hilltribes from cultivating opium, an economic mainstay of the largely agricultural hillside communities of the north for more than a century, His Majesty The King of Thailand set forth a royal decree insisting that 40 Lisaw and Akha farming families be given coffee sprouts by a Thai-German Highland Development Project. Peach, Japanese apricot and macadamia plants also were introduced. Located at a temperate 4,250 feet and with the surrounding abundance of old-growth forest, fresh flowing water and fertile soil, the Doi Chaang area is a natural spot for growing coffee.

With few other options, the Doi Chaang villagers conformed. But their lives barely improved because the farmers functioned independently and were inexperienced in business. To sell their beans, each farmer had to transport them on treacherous roads to Chiang Rai, the nearest city, where dubious middlemen would pay minimal prices—a story that has played out far too often for far too many coffee farmers around the big, blue marble.

Frustrated by continually being shortchanged, 10 coffee-growing families, mostly Akha, turned to a savvy world traveler, entrepreneur and fellow Thai named Khun Wicha Promyong. He encouraged the Doi Chaang farmers to form a cooperative, thereby making it impossible for the coffee dealers to play one family against another. And so their own coffee company, the Doi Chaang Fresh Roasted Coffee Company Ltd., was hatched, allowing them to produce and ship their organic, single-estate coffee directly to market, most of which was scattered throughout Thailand, Korea and Japan.

It wasn’t long before Darch caught wind that the villagers were keen on expanding their business internationally. An inquiry was made as to whether he would be interested in pursuing another Thai business venture. “Admittedly, at the time I was thinking, ‘Thanks but no thanks,’” says Darch.

Acting out of politeness but with little inclination to become a coffee man, Darch agreed to meet with Promyong. “When we met in Bangkok, he was sitting cross-legged on a pile of cushions, wearing a mixture of Western-hippie, traditional-Akha and monk attire”—far from the suit-and-tie businessmen Darch was so accustomed to encountering. Suspicion began to brew, yet Promyong’s diminutive stature, warm smile and kind eyes quickly won Darch over, as did his unselfishness. “Like me, he had the privileges of education, healthcare and wealth, yet gave it all up to live and travel with Thailand’s hilltribes,” Darch says. “His vision for the Doi Chaang villagers to create a better life for themselves through unity, education and sustainable farming was inspirational.”

Excited by Promyong’s pitch, Darch felt compelled to return north to see the Doi Chaang village for himself. “I was amazed. Despite what Promyong had told me, I was pretty much expecting the familiar impoverished and destitute village that had become the symbol of the typical hilltribe community. Yet here was an energetic farming community, replete with rudimentary electricity, running water, a school and a functional medical clinic.” On guard, Darch looked over the plants that, by all accounts, seemed to be healthy and growing vivaciously. The onsite roasting plant and storage facilities were spotless and organized. A flourishing reforestation project was supporting the production of many types of crops that not only provided food but also were sold at markets to help support and diversify the village’s economy. “Overall, it was clearly apparent that the Akha of Doi Chaang had a great sense of pride in their achievements, which was very much deserved,” Darch says. “They had not only created a successful coffee company, they also created a sustainable coffee company for the benefit of all the villagers for generations to come.”

Darch admits that this all left him a little red-faced; his own business ventures had been in natural resource development, which by its nature leads to depletion. The finiteness of these projects creates negative consequences for employees, their families and the involved communities. “And here I was now, presented with a business that could expand without depleting the earth’s natural resources and at no detriment to the workers and families.”

So what exactly did they want from Darch? Promyong didn’t ask for money, says Darch, and he didn’t offer. “Instead, he wanted a business relationship for his people.” As Darch learned, Doi Chaang’s agricultural success was such that production had exceeded demand in Asia, so justifiably Promyong wanted Darch to introduce the company’s coffee to the North American market. But Promyong had two non-negotiable provisions: The coffee had to be sold under the title “Doi Chaang,” and as an unblended, single-origin product.

These stipulations brought some ire from interested international investors. And naturally, Darch was tentative to immerse himself in an industry with which he had no prior knowledge or experience. But he found himself infatuated with the Akha and how the tribe had maintained its heritage and cultural values while providing necessary economic stability and growth for the community. Darch decided to contact Wayne Fallis, a colleague in Canada with extensive experience in food exporting and importing, for his input. “I convinced him that I had found a project that was more rewarding than just a financial return.” Darch found himself preaching to Fallis (now departed for other business ventures) that this was an opportunity to engage in an alternative business practice where the focus would be on relationships, sustainability and equal allocation of wealth, instead of just maximizing their investment. Fallis liked what he heard, but both men understood that before going forward they needed an independent evaluation of the quality of the beans. To do so, they sought the palate of renowned Calgary-based roaster Shawn McDonald.

McDonald has been roasting coffee for nearly 20 years, during which time he has come in contact with most of the coffee varieties out there. So when Darch approached him, he initially viewed Doi Chaang as just another ho-hum startup. “In this profession we get pitched, sometimes daily, with the latest, greatest, most unique coffee,” says McDonald. It wasn’t until he sat down with Darch and listened to the story that he became curious. “Once I had a chance to roast and play with the coffee, I was sold on this being the real deal. This coffee is the most meticulously grown and prepped zero-defect coffee I have ever worked with.” The flavor of Doi Chaang, depending on roast, ranges from smooth floral notes with a slight citrus finish to an exotic, rich dark roast with a hint of macadamia nut.

McDonald was not only convinced that Doi Chaang produced a world-class coffee, but he was so enamored by the story behind the black gold that he agreed to work out of Calgary as roastmaster and vice president of operations. 

And so began another forward-thinking business arrangement. Today, the farmers maintain total ownership and control over their own Thai company and domestic sales. In addition, they also have 50 percent ownership in Darch’s Vancouver-based Canadian company, Doi Chaang Coffee Company, created to roast and distribute Doi Chaang coffee in North America. “My colleague and I agreed to personally provide 100 percent of the finance required for all aspects of the Canadian operation, leaving the Akha to focus on production, quality control and expansion,” Darch says. In simple business terms, because of their ownership in the Canadian company, the 800-family Akha cooperative receives 50 percent of the Doi Chaang Coffee Company profits without any operating cost to them—a relationship likely to have most business pundits questioning Darch’s sanity.

Under an agreement between the two companies, though, Canadian Doi Chaang Coffee Company has exclusive rights to North America and Europe distribution and to purchase up to 75 percent of the annual production of green beans from the Thai Doi Chaang Fresh Roasted Coffee Company Ltd. at a price negotiated in the spring of each year. Likely, most Akha farmers find that price almost too good to be true. “The price we paid for a recent order of green beans was well in excess of 50 percent greater than the stipulated purchasing price for organically grown fair-trade coffee,” notes Darch. “It’s deserving compensation when you consider their commitment to growing exceptional beans in a sustainable manor. Plus, it gives the Akha farmers an immediate profit and the ability to carry on attending their coffee production.” While Darch’s company’s main objective is to sell roasted coffee, it also has the right to sell green beans to other roasters in North America and Europe.

The Doi Chaang Coffee Company is now Darch’s only active business involvement, with seven employees in Canada and beans in roughly 150 stores, primarily in Alberta and British Columbia but with a presence in Manitoba, Saskatchewan, Ontario and Southern California as well. At press time, Darch was busy launching his single-estate, shade-grown coffee in the fair-trade-savvy United Kingdom. “We have linked up with a medium-sized, reputable specialty coffee roaster in Dorset, who shares the same ethical values as Doi Chaang.” The roasted coffee will then be entering specialty food stores, delis and health-food outlets. But, like any startup in the exceptionally competitive coffee market, Darch has found himself struggling to branch out. “Perhaps our biggest obstacle to growth is convincing coffee drinkers to pay slightly more for a coffee that doesn’t come from a well-known coffee-growing area like Ethiopia or Colombia,” he says. “But I know when people taste Doi Chaang coffee they will thoroughly enjoy it and become committed buyers.”

Darch, rightfully so, likes to talk about the reviews that his coffee has received from leading independent North American coffee connoisseurs, including 93 points out of 100 for the peaberry roast—Darch’s personal favorite—by Kenneth Davids of the lauded Coffee Review. Never one to pat himself too hard on the back, Darch also is often the recipient of favorable reviews from his peers. “I appreciate his dedication to the Doi Chaang group, his visionary and marketing skills, his ability to look at the big picture, and lastly, the integrity and honor he displays in everything he does,” says McDonald. “At this stage of the game, I am only interested in dealing with people of his caliber.”

But it’s the Akha farmers who give Darch the tenacity he needs to weather the rough spells. “I am proud of how the Akha farmers themselves have responded so positively to their success by using their coffee revenues to focus on improving community living standards and the quality of their coffee,” he says. “For so long, the Akha people of Doi Chaang village were isolated in poverty in Thailand’s mountains, denied basic resources and even ostracized from society.”

Darch points to the recent construction of the on-site Doi Chaang Coffee Academy by the farmers at their own expense as an example of community-minded agriculture. “All hilltribe farmers are welcome to attend, at no cost, to learn about cooperative business practices, diverse crop production, quality control and sustainable agriculture,” says Darch. The Thai government has also taken notice, calling the business a role model for other communities. “I believe this is an alternative and viable way of doing business with coffee farmers that I hope other coffee companies will explore,” Darch says.

Home in Canada, Doi Chaang Coffee regularly contributes to various charity projects, including lending support to a local children’s hospital and the Calgary Ronald McDonald House. “Doi Chaang has given me the opportunity to invest time and money to help underprivileged and disadvantaged people improve their lives,” Darch says. “I like to think of this charity work as a modest payback for all the wonderful things that I have been blessed with in my life.”