2016 Corporate Responsibility Report
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Sustainable Agriculture

There are many agricultural inputs into the food we produce, such as fruit, coffee, sugar, grains, and more.

At Smucker, we invest in sustainable agriculture projects and initiatives, not only to help us maintain a reliable supply of these raw ingredients, but also to support the farmers who produce them and the environment in which they are grown.

Our commitment to sustainable agriculture includes our membership in The Sustainability Consortium (TSC), an independent organization committed to the development of transparent strategies and tools to drive sustainable products and supply chains. As part of our efforts to better understand sustainable agricultural practices, we partnered with TSC, the University of Arkansas, and Arizona State University to conduct a water risk analysis in seven key Company supply chains. The research used data from the World Resources Institute’s (WRI’s) Aqueduct Measuring and Mapping Water Risk tool to calculate water risk for 12 water indicators. The research also provided insight on production intensity, irrigated versus rain-fed crops, and relative water risks to global supply versus our sourcing regions.

Green Coffee Sustainability

In addition to certified green coffee purchases, our Smallholder Support and Integrated Environmental Efforts help provide access to certain markets, resources, and technologies to improve farmer livelihood. These three key elements are focused strategically on long-term supply, producer viability, and climate change – issues that we believe are critical to supply chain participants, customers, consumers, and shareholders.

Much of the world’s coffee supply is grown by individual farmers on small parcels of land in developing countries, where the opportunity to improve agricultural and business practices is often significant. Sustainable coffee supply and the economic viability of these small growers must be linked. For this reason, we partner with leading development organizations to better address holistic and systematic improvements in coffee regions.

Encouraging Women Coffee Farmers’ Participation

Studies have consistently shown that gender equality can enhance economic productivity and improve societal developments for future generations. Experts also suggest that gender-balanced teams are crucial to the success of smallholder coffee communities. In Central America, as in other parts of the world, women still encounter many barriers to entering the coffee-growing industry on their own. These barriers include access to land and credit, production capacity, and distribution of tasks. While women often play as large a role as men on the farm through activities such as managing the family farm while their husbands work elsewhere, determining the price at which to sell the coffee, and taking the coffee to market, women do not necessarily see the same gains as their male counterparts.

Based on an initial gender study, the project has developed a strategy to more thoroughly integrate women into the coffee-growing process, such as building a gender-balanced team of community trainers and training project staff on gender equality issues. With a gender-balanced community training team, which is made up of 46 percent women and 54 percent men, the project engaged 1,756 women, or about 27 percent of participants. The hope is that women’s participation will increase in 2016, further empowering women economically in the coffee-growing region of Nicaragua.

Integrated Coffee
Environmental Efforts

The world’s growing consumption of coffee, combined with increasingly variable climate conditions in many regions of the world, requires development of processes to increase production yields in a manner that also protects natural resources. Many of the agricultural strategies imparted by TechnoServe, the Neumann Foundation, and others help address the unique environmental conditions for coffee production, including elevation, temperature, precipitation, and soil.

We also continue to partner with World Coffee Research (WCR), which aims to increase the availability of quality coffee in a sustainable manner through research and development. WCR is focused on finding solutions to four major supply constraints and threats to coffee in the 21st century, including climate change, disease and insect pressures, aging tree stock, and increasing consumer demand.

In 2015, with the support of Smucker and the Neumann Foundation, climate scientist Peter Baker conducted a study to evaluate climate-related production challenges in southern Sumatra during the 2015 El Niño event. The study outlines current effects of this crisis on the region; the past, present, and future fluctuations of the regional climate activity; and adaptation measures the farmers of the region must take in order to maintain coffee productivity despite rising temperatures and increase chances of extreme weather events.

Quinoa

Our truRoots® brand features organic, gluten-free, and non-GMO ancient grain products, including sprouted and non-sprouted grains, pastas, beans, legumes, and seeds. Since acquiring the truRoots brand in 2013, we have been working with Fundación Valles, a foundation that offers innovative technology to support the development of rural economies and builds capacities for sustainable production of organic quinoa through the support of small-scale, indigenous farmers in the Altiplano, or “high plain,” regions of Bolivia. By extending our partnership with Fundación Valles, we are promoting local growers and 100 percent traceable organic production to bring consumers a sustainable product from farm to fork.

As of 2015, this partnership has made possible:

  • USDA organic certification for more than 600 hectares of land;
  • Technical assistance for 275 small-scale quinoa growers;
  • Introduction of five new varieties of quinoa to the region;
  • 13 workshops in which 199 quinoa growers participated; and
  • 450 tonnes of 100 percent certified organic quinoa harvested for the U.S. market.

Our Global Coffee
Market Engagement

As the largest mainstream coffee roaster in North America, we draw upon years of global market experience to source coffee from around the world in a responsible manner. Some of our direct global engagement includes offices in Brazil and Vietnam, two of the largest coffee-producing countries, as well as program support in multiple producing countries for efforts to improve the long-term sustainability of smallholder coffee farmers.

TechnoServe Partnership in
Central America

A long-term Smucker partner is TechnoServe, a well-respected nonprofit organization dedicated to empowering people in the developing world to build businesses that break the cycle of poverty. TechnoServe has developed an adult learning model for coffee farmers that incorporates information with a hands-on approach, along with demonstration plots to show results. While other training programs bring farmers to classroom settings, TechnoServe conducts trainings on coffee farms, using highly participative adult education best practices. Rather than cover concepts in a single session, TechnoServe offers an 18-month program to fully cover a coffee-growing cycle, as well as covering additional training topics such as finance, farm management, and gender equity. Upon completion of this intensive training, farmers have the necessary knowledge to maintain high yields, be more resilient, and have greater long-term economic potential. In 2015, TechnoServe worked with 152,000 coffee farmers on 17 projects in nine countries.

For a second year, we are engaged in the Better Coffee Harvest Project, a four-year partnership with TechnoServe, the United States Agency for International Development (USAID), and the PIMCO Foundation, to help mitigate the detrimental effects of coffee leaf rust in Central America, specifically Nicaragua and El Salvador. The goal of this project is to reach 6,000 smallholder coffee farmers with the intensive training necessary to increase yields in order to boost productivity and farm revenues by 25 percent. The project also focuses on improving farmer access to appropriate inputs like financing and quality planting materials. The expertise of TechnoServe in coffee farming and in Central America is enabling a faster-than-normal startup for the project. In its first year, the program exceeded its goal by engaging more than 6,500 participating farmers, 64 percent of whom have started adopting practices learned through the program.

During 2015, the project established initiatives dedicated to providing:

  • Up to $2 million in loans for coffee producers.
  • The verification of health and quality of planting material supplied by coffee nursery operators in both countries, some in collaboration with World Coffee Research.
  • 157 demonstration plots, which include existing coffee varieties in addition to new, rust-resistant plants. These plots allow farmers to compare outputs of two coffee varieties, as well as create stock for future crops.

Hanns R. Neumann Foundation Project in Indonesia

We continue to have a strong partnership with the Hanns R. Neumann Foundation (Neumann Foundation), a private nonprofit development organization based in Germany that implements sustainable economic development programs and projects with smallholder coffee and cocoa farmers around the world. The current 46 Neumann Foundation projects are supporting 80,675 producers in 12 countries to improve their production systems, entrepreneurial skills, and incomes – while protecting and conserving vital natural resources.

During 2015, we continued working on the ground with the Neumann Foundation in Indonesia. Here, we are collaborating on a direct outreach project with smallholder coffee producers in the mountain regions of southern Sumatra. Indonesia is a significant producer of coffee but is challenged by extremely low yields that often result in difficult economic, social, and environmental conditions in farming communities. Our project’s goal is to increase coffee yields by 50 percent for up to 5,000 participating farmers by providing them with technical expertise, as well as strengthening farmer organization.

In the third year of the program, registration reached more than 4,300 smallholders who live in remote areas with limited access to extension services or best practices. Active training continues with these farmers, who are organized into 200 farmer groups, and has increased significantly as project technicians have supported farmer trainers and government extension officers to lead sessions on their own. With more than 21,000 training contacts accumulated since 2014, this training takes an intensive, farmer-centric approach in which the participants are active in determining what type of training they need and receive an estimated nine direct interactions per year for training and consultation, for an average total of 36 contacts per farmer over the project lifetime. As a result of trainings, coaching, and mentoring from project technicians, multiple farmer groups are now selling directly to exporters. The improved supply chain avoids village traders, which has resulted in a 5 percent increased margin for the farmers’ beans.

Wheat

In 2015, our White Lily® brand launched an innovative and sustainable line of flour products using wheat produced by The Shepherd’s Grain®, a group of more than 60 family farms in the geographical regions of southern Alberta, the Pacific Northwest, and Southern California. These progressive growers use sustainable farming methods that improve soil conditions through practices such as no-till and direct seed agriculture. The increased transparency in our White Lily premium wheat flour blends allows consumers to trace the product back to The Shepherd’s Grain® farmers.

Corn

Through our Mill-shed project, we work with 17 growers who represent 80 percent of our specialty corn supply on a project focused on optimizing nutrient management and sustainable practices. Growers provide data pertaining to on-farm activities, including fertilizer usage, water usage, soil practices, and greenhouse gas emissions. The project utilizes an online calculator that allows farmers to input data and to compare their activities to other farmers in their region. The field-level insight enables continuous improvement of their farming practices. In addition, we analyze this information with our mill partner annually to highlight results and find opportunities for further improvement of sustainability practices. Each year in our Grower Meeting we bring in experts to speak on topics of interest regarding sustainability.

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