CeriTech (Improving Coffee Processing through IoT)

Indonesia as the world’s fourth-largest coffee producer and exporter surprisingly still using traditional, trial and error practices to process its own coffee. Most of coffee farmers and producers still rely on information based on trial and error, or conventional measuring tools to process coffee cherry to coffee beans. This non-data driven processing, leads to inconsistent and even low quality coffee.

CeriTech is a monitoring and data acquisition system for coffee processing using Internet of Things (IoT). It monitors and collects variables from fermentation and drying phase that prove to be the most important aspect to be monitored in order to achieve certain quality and maintain consistency. The data could be the basis for further treatment to improve the process, especially in terms of aligning to micro climate and resiliency towards climate change.

Indonesia as the world’s fourth-largest coffee producer and exporter surprisingly still using traditional, trial and error practices to process its own coffee. Most of coffee farmers and producers still rely on information based on trial and error to process coffee cherry to coffee beans. This non-data driven processing of coffee, leads to inconsistent and even low quality coffee. As the processing phase is one of the most important activities that determines the quality of coffee bean produced along with the quality of the coffee cherry itself, it is important to improve and encourage the producer to have a better practices in coffee processing activities in order to enhance the value and achieve sustainability as a coffee farmer and producer. 

Worlwide presumptions of Indonesian coffee is that most of the coffee produced have low quality and have a high level of inconsistency. This phenomenon could be the impact of the coffee processing which still traditional and non-data based practices. So that even if it is good in one batch, it won’t be a suprised if the next one have a different quality or even different flavours.

The number of smallholder coffee farmers in Indonesia approximately in range of 800.000 – 1.500.000 farmers. With the globalization and urbanization trends increasing, the job as coffee farmers is in a brink of elimination in the future. Coffee farming in Indonesia is still considered as a non secure job financially, some are still see the job as a bonus as to other farming area. There is a lot of cases that the young generation, the offspring of coffee farmers itself did not want to inherit the land and the job, thus they chose to go to a big city and work as factory worker. This phenomenon caused by the fact that being a coffee farmers couldn’t secure their financial needs. By improving the quality, the value of coffee should be increased thus the financial needs of coffee farmers could be secured. 

Our solution is CeriTech, a monitoring and data acquisition system for coffee beans processing using Internet of Things (IoT). It consist of two subsystem, one for fermentation process called CeriFer, and the one for drying called CeriGar. CeriTech monitor and collect variables that proven to be the most important aspect to be monitored in order to achieve high quality and maintain consistency. Then the data could be the basis for further treatment and/or practices to improve each process.

In order to achieve high quality and consistent coffee, fermentation process should be done in proper and detailed manner. With CeriFer,  fermentation process could be monitored perfectly by collecting and delivering data in real time to user (coffee farmers/producers). Variables that most important in the process such as pH, temperature, and humidity then recorded and monitored. The system could also sends alert to the user if the variables exceeded the threshold number that set by the user to get the desired fermentation result. The data then could be used as a basis for further improvement, or as a benchmark to other batch so that the consistencies of qualities could be achieved. The same concept applies to the use of CeriGar. It collects temperature, humidity, and light intensity of a coffee drying house so that the drying process could be monitored. The data could be used as basis to treat the coffee bean or even as a consideration to design the ideal drying house so that the desired drying process, which are slowly, evenly, and consistently, could be achieved. 

Improve the quality of coffee beans produced by coffee farmers and processors. With an improved quality, the price of the goods will also be increased. The flexibility and resilience to price change  will be increased, as the products now have more bargaining point to get the best value out of the market. This impact could affect the financial sustainability of the coffee farmers. 

Currently there is no company focused on real time monitoring cloud based system using Internet of Things in the coffee processing area that we might know of who might become one are the other start up who might think the same concept. 

We will overcome with early exposure and networking with coffee farmers. Government exposure, media and private sector highlights will become our channel to to show that we are the first one to build the system and spread the triumph of increasing the farmer’s income.

At the moment we are partnering with two small coffee company who was founded by coffee farmers, and one independent coffee farmers. One example of the usabilities of our solution, when we piloting the solution in North Bandung farm area, a new insight was extracted from the data regarding the design of drying house in that particular area. Before our solutions were applied, the common designs for coffee drying house among coffee farmers were unisolated, oval shaped without any added air flow system. After our solution was implemented for almost a month, the data show that the drying house temperature was so high (around 60-70 degree celcius) in the peak day and on the contrary in the night time, the humidity increased up to 99%. This insight leads to a conclusion that the design of the drying house was not ideal. Then research of the design was conducted, and in the new design of drying house which adopt the isolated and improved air flow system, the temperature and humidity could reach the desirable range.

Same with fermentation, the coffee farmers obtain insight of the fermentation process which could be the basis for batching production to achieve consistency.

The users that have used our product in West Java Indonesia on May 2019:

• Kopi Florist. Small coffee company in Bandung, Indonesia founded by Yadi Mulyadi, smallholder coffee farmer that produce speciality coffee from their own farm.
• -Mayangsari Coffee. Small coffee processor in Bandung, Indonesia founded by Ari, young coffee farmers that dream to take his coffee to next level.
• Mr.Aceng.  Smallholder coffee farmers in Bandung, Indonesia that are thriving to learn better coffee processing.

And we have piloted our product in Aceh Indonesia on December 2019 collaborated with 10 coffee farmers. 

in next year our primary targer will be raising up our revenue from CERI's selling, we will strengthen up our marketing team and strategy and also keep on improving CERI's technology. in last quarter of this year, if everything goes smoothly we will begin to plan on CERI 2.0 (data processing and decission making system).    

 Tech side : development of product in terms of reliability and durability. By next year, the manufacturing part problem should be arise and should be addressed, if any. Also, we will begin the development of data processing and decision making system along with predictive analysis of micro climate condition. This action would require collaborative actions between our company and environmentalist, let alone agronomist. The start of this development will mark CERI 2.0.

 Business side : Expanding the market, maintain customer relationship and network, perfecting operation activities, developing and adapting business model to new regulation and condition, if any.

Smallholder coffee farmers network and the expert network including actors from all over supply chain activities, from upstream to downstream industry. And also the sociopreneur model which the goals is not that bluntly into direct profitability traction.

The network of smallholder coffee farmers could be a tricky part because the marketing approach require more of a social trust and belief system than a cost-to-value mindset.

That requiring network was already built by our company through the influential smallholder farmers which oversees many cooperatives and smallholder coffee farmers.

The actors from others activities along the supply chain would be the validation committee for the output, as they represent the market. And it would be an obstacle if the new entry wasn’t around in the environment before.

with a comprehensive and elaborate agreement regarding business relationship, business perspective and strategies including Intelectual Property (IP) issues, technical procedures, and also the ability to resolve disputes fairly and in timely manner. 

We validated our products by interviewing coffee farmers and follow thoroughly the activities of their coffee processing. We centered our solution based on the user’s main problem, and carefully considering many others issues to be as comprehensive as possible.

1. Industrial Ministry of Republic of Indonesia. 

1. Aldi Ardian Raharja : Founder and CEO of CeriTech Indonesia. 

2. Ahmad Radhy: Founder and CTO of CeriTech Indonesia.

3. Azmy Ansori: Head of Software of CeriTech Indonesia.

Aldi Raharja – Business Development:: Bachelor of Science in Physics (Earth Physics) Institut Teknologi Bandung, Master of Science in Industrial Engineering and Management Institut Teknologi Bandung.

Ahmad Radhy – Hardware and IoT Engineer: Bachelor of Science in Physics (Material Physics) Universitas Gadjah Mada, Master of Science in Physics (Electronics and Instrumentation) Institut Teknologi Bandung.

Azmy Ansori – Software Developer :Bachelor of Science in Physics (Nuclear Physics) Institut Teknologi Bandung.

1. PT. Bosch Indonesia is currently funded for product developement of CeriTech.

2. XL Axiata has been funded for project implementation in Aceh Indonesia.

Our business model bases on ‘Penta-helix Model’ which requires collaboration between stakeholders, including academic, business, community, government, and media.

As a business, we will collaborate closely with related government body and utilize programs  already implemented. “Perhutanan Sosial (Social Forestry)” is government’s legal programs that enable communities to participate in managing forests and get economic benefits. Implication of this program is that farmers who could have a legal right and standing to act, actively seek and propose direct aid, development funds or grant from any formal legal source, such as Company Social Responsibility (CSR) from companies or other funds from related body. We will align our solution as an option for the coffee farmers to improve their coffee processing.

With private sector, business to business collaboration will also be the objective, along with direct selling to those who are in coffee industry. The collaboration for smallholder farmers will cross on the use of their CSR funds, with our solution as one way to improve the supply chain of coffee.

Our business model will adopt subscription type. We will rent our system, the device along with the software application and maintenance support to our end user which is coffee farmers and coffee processors. One CeriTech system consists of one system of CeriFer (one device of fermentation monitoring) and one system of CeriGar (one device of drying monitoring).

Our target customers are coffee farmers and coffee producers. Latest data shown that total smallholder coffee farmers area in Indonesia are 1.204.883 Ha, with smallholder farmers number in 800.000 – 1.500.000. We will target 10 % of these number as our target market, which is 150.000 smallholder farmers.

With an assumption that in 5 years all the target market fullfiled and maintained, we have total revenue of 150.000 farmers x USD 20 x 6 month = USD 18.000.000 yearly in year 5.   

Calculation of pricing will be based on the assumption of approximately number of farmers and total area that they managed. Smallholder farmers on average managed 1 – 2 Ha coffee farm, thus our field survey showed that they will produce approximately 1.500 – 3.000 kg coffee cherry a year. With coffee cherry valuation at approximate USD 0.7 – 0.8 per kg, they will gain USD 1.050 – 2.400 grossly a year.

We then will price the subscription fee per system at USD 20 per month, a reasonable price that we think they would spare to get the system in terms of cost to value consideration, with the average processing time of coffee took time 6 months per year.

Currently there is no company focused on real time monitoring cloud based system using Internet of Things in the coffee processing area that we might know of who might become one are the other start up who might think the same concept.

We will overcome with early exposure and networking with coffee farmers. Government exposure, media and private sector highlights will become our channel to to show that we are the first one to build the system and spread the triumph of increasing the farmer’s income.