Tea garden in India

Egypt / India / Colombia / Mexiko Tea, coffee, spices: Organic producer committed to sustainable supply chains

Asia
North Africa & Middle East
Latin America
DEG
Classic

Aligning supply chains for the benefit of people and nature is one of the central tasks that companies must master in order to address the issue of sustainability holistically. Ulrich Walter GmbH, a company that produces organic tea, coffee and spices under the "Lebensbaum" brand, is committed to comprehensive sustainability management among its cultivation partners. As part of a joint project with DEG - Deutsche Investitions- und Entwicklungsgesellschaft mbh, it was possible to strengthen productivity and improve the living conditions of employees at four of the company's main suppliers. The project was implemented within the framework of the develoPPP-programme funded by the German Federal Ministry for Economic  Cooperation and Development (Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung, BMZ).

The demands for sustainability on the part of buyers are increasing, but in many parts of the world there is an increased risk of violations of environmental and social standards - including in organic agriculture. Inadequate local working conditions often lead to high turnover and poor employee loyalty to suppliers. In addition, resource-efficient production of raw materials and effective land management are posing increasing challenges. Careful sustainability management along the supply chain is therefore not only ecologically sensible but is also in the interest of organic producers such as Lebensbaum as it offers companies long term pay off. Through soil improvement measures, they benefit from greater reliability and ultimately higher product quality. Higher social standards lead to greater satisfaction among employees and stabilise the cooperation between cultivation partners and buyers in the long term.

The develoPPP project, with a total budget of around 330,000 euros, aimed to (further) develop transparent and effective sustainability management along the value chain. Between 2016 and 2019, differentiated measures were implemented together with local producers for tea (Ambootia, India), coffee (Finca Irlanda, Mexico; Hacienda Cincinnati, Colombia) and spices (Sekem, Egypt), depending on the initial situation, including:

  • On-site visits to suppliers and exchange of experiences with them.
  • Improvement of agricultural practices, including composting, soil management, disease and pest control in India, Mexico and Colombia.
  • IT-based risk scoring system for crop control (Egypt).
  • Social programmes for staff retention (Colombia) and health promotion (India).
  • Establishment of a training centre for soil building (India).

Ulrich Walter GmbH and project partner Soil & More Impacts contributed their expertise on sustainable supply chains in agriculture as consultants. DEG financed the measure using develoPPP funds.

Establishing environmental and social standards throughout the supply chain not only strengthens relationships with suppliers, but also ensures the quality of our products.
Henning Osmers-Rentzsch, Sustainability Officer at Ulrich Walter GmbH
Football pitch at the Hacienda Cincinnata in Colombia
At the Hacienda Cincinnata in Colombia, various opportunities were created for employees to spend their free time. Photo: Tree of Life
Composting from tea cultivation in India
As part of improving agricultural practices, composting has been introduced in Assam, India. Photo: Lebensbaum

Depending on the needs of the partner farms, sustainability management measures were newly developed or further improved. For example, optimised farming practices led to soil improvement and ensured quality standards (India, Colombia, Mexico).  An IT-based risk scoring system for cultivation control was evaluated and tested at the experienced spice producer Sekem (Egypt). Social measures such as cultural and sports activities (Colombia) or health protection (India) led to lower staff turnover and absenteeism. Overall, the measures strengthened local productivity and long-term trade relations with the  partner farms.

  • Training centre established for biodynamic agriculture near Ambootia, India
  • Tracing tool introduced for transparency and tracking at SEKEM, Egypt

Development successes

improvement of agricultural practices (especially soil management and CO2 sequestration in the soil)

Improved health protection

lower fluctuation due to employee loyalty (community facilities, recreational opportunities)

Economic successes

reduction of economic risks

intensification of partnerships with suppliers

develoPPP Classic

develoPPP Classic is aimed at medium-sized and large companies that want to invest sustainably in a developing or emerging country and expand their operational activities locally. Suitable projects receive technical and financial support of up to two million euros in public funding.

Ulrich Walter GmbH (Lebensbaum)

Ulrich Walter GmbH (Lebensbaum) specialises in the production of organic tea, coffee and spices. The medium-sized company sources its raw materials directly from its cultivation partners and was awarded the German Sustainability Award in 2015.

DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH

The KFW subsidiary is a specialist in complex financing in developing and emerging countries with comprehensive know-how in long-term investments. DEG promotes and supports companies in the manufacturing industry, the agricultural sector, the infrastructure sector and the financial sector.

Henning Osmers-Rentzsch Sustainability Office Ulrich Walter GmbH
Claudia Makowski Senior Investment Manager, develoPPP Deutsche Investitions- und Entwicklungsgesellschaft mbH