JKCC raises a USD 6.5m subordinated loan from the IDH Farmfit Fund to expand its high-growth coffee marketing operation in Uganda, directly benefiting smallholder farmers
Working Capital, Expansion Capex, and Technical Assistance to reach 20,000 smallholder farmers and increase their income by a minimum of 50 percent in seven years.
The IDH Farmfit Fund with great pleasure announces a USD 6.5 million investment in a highly impactful coffee aggregating, processing, and exporting company. This Investment was managed in collaboration with the Africa Agriculture and Trade Investment Fund (AATIF) and other lenders, who have supported JKCC’s growth because of its strong impact and direct sourcing from Smallholder farmers.
JKCC, also known as “Just Know Your Coffee Cup,” was founded in 2019 to market robusta and arabica coffee green beans in Uganda. It aims to improve the livelihoods of smallholder farmers by directly sourcing from farmers at a premium to the market price, providing technical assistance to improve production and productivity, and guaranteeing offtake, which gives farmers security of tenure and encourages them to invest more in their farms.
This Investment in JKCC supports an innovative agribusiness-driven business model that sources 100% of its coffee from 7,426 smallholder farmers. Providing flexible long-term working capital strengthens JKCC’s sourcing and increases its ability to incorporate more farmers efficiently into its supply chain. The Investment also supports a Ugandan-owned processer in a context where multi-national and international coffee traders dominate coffee processing and export and where, most crucially, middlemen dominate the aggregation and sourcing of coffee from farmers.
We are proud to have JKCC as a partner and support them in their growth and farmer outreach. It is great to see a local coffee exporter be so successful among all the international traders, and the key to their success appears to be their extensive support to their farmers. Our Investment in JKCC will help the Farmfit Fund achieve its targeted impact on a farmer level.
On behalf of the JKCC fraternity, we are grateful to have the IDH Farmfit Fund as one of our long-term partners. The Investment from the fund is a powerful one for the future of our company and the livelihoods of our coffee farmers, which span three major coffee-growing regions of Uganda. This shall enable us to expand our sustainable practices, improve quality, and grow into a sustainable producer that benefits the community.
We are proud to work with an exciting new partner in Just Know Your Cup of Coffee. The team at JKCC have done fantastic work setting up a successful local coffee export company in Uganda with strong ties to local communities. In supporting JKCC’s growth, we expect to be able to extend their already extensive farmer network and improve the livelihoods in these communities by providing market access.
JKCC is more than a coffee marketer in Uganda; it has a bold growth strategy focused on creating value for smallholder farmers as a social enterprise. By organising over 95 farmer groups under the Consortium of Central and Western Farmers Associations, JKCC efficiently provides agricultural support, financial literacy training, and access to finance. The Investment will facilitate JKCC’s downstream integration into coffee processing &support the organic expansion of this innovative business.
Transaction Support
Legal support for this transaction was provided by Meijburg Legal in the Netherlands, led by Lucas Lustermans (Partner) and Joost Kool (Senior Associate) and jointly assisted by the Uganda law firm AF Mpanga Advocates, led by Daniel Gantungo (Partner) and Brian Banana Baine (Associate).
About JKCC
JKCC General Supplies Ltd is a coffee exporting and processing company established in 2017. They aim to develop and promote Uganda’s coffee industry by providing farmers with technical assistance and credit programs. Starting in Nsangi village, JKCC aimed to support local farmers in extracting more value from their produce and has eliminated exploitative middlemen from their sourcing supply; with this approach, JKCC has grown to operate in 16 districts and benefits 7,000 farmers across Uganda. Their effort to streamline coffee aggregation to benefit smallholder farmers directly contrasts the mainstream sourcing channels dominated by over 10,000 middlemen targeting 1.8 million smallholder farmers and accounting for the sourcing of more than 95% of Ugandan coffee production. JKCC’s approach is to source 100% of all its FAQ coffee directly from Smallholder farmers at a premium to market prices. JKCC processes the FAQ into high-quality green beans before exporting.
For more information, visit https://jkccgeneralsuppliesltd.com/
About IDH Farmfit Fund
The IDH Farmfit Fund is a blended finance impact fund for smallholder farmers, many of whom are amongst the poorest people in the world. The IDH Farmfit Fund can take the highest risk positions in smallholder farmer-related transactions, reducing the risk currently borne by borrowers and lenders. By doing so, the IDH Farmfit Fund aims to catalyse commercial capital to co-invest in this sector. These investments will increase the availability of affordable, long-term financing to smallholder farmers, allowing them to invest in their farms, increase productivity and adopt climate-smart agriculture best practices, improving their livelihoods and incomes. The IDH Farmfit Fund is facilitated by the IDH Foundation and supported by a unique coalition of partners, including commercial banks, development banks, government bodies and value chain companies.
For more information, visit IDH Farmfit Fund.