Farmers’ Income Increased by Over 100% Thanks to Simexco’s Sustainable Value Chain

The income of low-income farmers who participate in Simexco Daklak’s sustainable coffee/pepper value chain has now increased by more than double (over 100%) compared to the first year they joined (from 2009 to now).

Many coffee-growing households in the Central Highlands have improved their livelihoods by shifting to sustainable farming methods. Cooperation with businesses and compliance with green agriculture standards help farmers reduce input costs, increase productivity, and sell products at higher prices [1]. The ecological multi-tier coffee garden model (intercropping fruit and shade trees) provides supplementary income beyond coffee, helping stabilize and significantly increase total income year after year.

Sustainability Journey Since 2009 – The Foundation for Income Growth

Simexco Daklak began its sustainable value chain development project in 2009, cooperating with thousands of farming households and international organizations to apply sustainable cultivation, adapt to climate change, and reduce greenhouse gas emissions—with the goal of enhancing the value of Dak Lak Robusta coffee and increasing farmers’ incomes [2]. This strategic direction allows farmers to farm more effectively instead of just chasing yield. Thanks to this, Simexco has built a purchasing network directly linked to more than 40,000 coffee-farming households across about 50,000 hectares in Dak Lak [3], creating a stable outlet for their products.

Over more than a decade of sustainable program implementation, Simexco has focused on improving productivity and quality in farmers’ gardens. The company invests in modern processing, trains farmers in advanced cultivation techniques (efficient irrigation, organic composting, cover crops, etc.). The goal is to help farmers lower production costs, increase yields, and improve quality, raising net profit per kg of produce. In fact, since adopting a sustainable approach, Simexco has achieved stable export growth (now over 100,000 tons of green coffee per year [4]), regardless of market volatility. This shows that farmers in the linkage chain have maintained and increased their output, thus increasing their total annual income.

Coffee Replanting and Diversified Intercropping – A Lever for Productivity and Revenue

A key pillar implemented by Simexco is the replanting support program. Since 2015, the company has provided over 3.5 million high-quality coffee seedlings for farmers to rejuvenate old plantations [5]. Thanks to younger gardens, many households have greatly increased productivity: new coffee varieties yield much more than aging trees. At the same time, Simexco has also supported the planting of 2.8 million shade and intercropped trees (like pepper, durian, avocado, etc.) [5]. Diversified intercropping gives farmers extra income besides coffee and improves the garden’s microclimate (shade, windbreak, soil moisture), reducing the risk of crop failure.

Notably, the multi-layered landscape coffee garden model, currently being implemented, has shown clear effectiveness. In this model, farmers intercrop high-canopy trees (fruit, shade) and groundcover plants with coffee. According to a household in the landscape project in Krông Năng (Dak Lak), the multi-tier arrangement keeps the coffee lush year-round, with stable yields and extra harvests from intercrops [6]. Therefore, their total income is more stable and much higher than before when only monocropping coffee.

In reality, intercropping strongly increases per-area income. In the early 2010s, many Dak Lak farmers intercropped pepper with coffee when pepper prices rose, gaining windfall profits. Later, as pepper prices dropped, the trend shifted to intercropping fruit trees (durian, avocado, macadamia, etc.), diversifying income sources. As shared by a Dak Lak coffee farmer, intercropping fruit or other industrial crops can increase income per hectare threefold versus monoculture—an income increase of 200% on the same cultivated area [7]. This is a very large growth rate.

Sustainability Certifications (4C, RA, Fairtrade) – Price Premiums Increase Income

Beyond productivity, Simexco helps farmers increase selling prices through sustainability certifications. The company is a pioneer in Vietnam in applying international sustainable coffee standards. Specifically, Simexco introduced 4C certification in 2010, later expanding to Rainforest Alliance (UTZ/RA) from 2012 and Fairtrade from 2014 [8]. To date, Simexco has supported about 11,928 coffee farmers to achieve 4C (2010–now), 4,550 coffee and 784 pepper households with Rainforest Alliance (2012–now), and 211 with Fairtrade (2014–now)—according to the company’s reports. These standards require sustainable practices (forest protection, reduced chemicals, safe labor, etc.), in exchange for higher selling prices.

Certification effectiveness is shown in the premiums and extra payments farmers receive. For example, 100% of coffee in sustainable project areas is bought at prices higher than conventional market rates [1]. For Fairtrade coffee, farmers receive a stable minimum price and a Fairtrade Premium (~$0.2/kg) for community investment, raising income about 10% over conventional sales. 4C and Rainforest/UTZ-certified coffee may not always get a big premium but enable farmers to secure better prices even during market fluctuations, thanks to committed buyers. More importantly, these certifications are often accompanied by support programs for technical guidance, fertilizer, and preferential credit—helping reduce input costs and thus raise household profit.

By complying with sustainable standards, farmers also raise product quality, enabling sales to higher-end markets at higher prices. Real-world data (e.g. Nestlé NESCAFÉ Plan) shows that regenerative cultivation (20% less chemical fertilizer, more ripe berries, etc.) increases yields by 5–15% and cuts emissions by 15–20%, while boosting farmer income by 30–100% over traditional farming [9]. This shows that, with improved quality and productivity, incomes can double under the right conditions.

Coping With Market Fluctuations – Reducing Risk, Increasing Opportunity

Agricultural markets such as coffee and pepper are highly volatile, posing major challenges for smallholders. Simexco’s sustainability journey has made its linked farmers more resilient to price fluctuations, allowing them to capitalize on market opportunities for increased income rather than suffer losses. When coffee prices hit historic lows (2018–2019), many farmers in other countries abandoned their fields, but in Vietnam, high yields and low costs meant many still made a profit [10][11]. For example, Vietnam’s Robusta coffee yield has increased by ~18% in the past decade (to about 2.5 tons/ha) thanks to technological progress [11]. Production costs have been reduced through mechanization and better input management—advances that Simexco has driven through training and support helping Vietnamese (especially Dak Lak) farmers survive low prices and benefit greatly when prices rise.

Diversification also spreads price risk. For example, the 2014–2015 pepper price boom enabled coffee-pepper intercroppers to earn billions of dong in a few years. When pepper prices later dropped (2018–2020), these farmers shifted to fruit crops like durian (now highly valuable for export), thus offsetting losses and avoiding severe income drops. In contrast, a monoculture coffee farmer would struggle during price slumps, while those with pepper/durian income could maintain living standards. This flexible approach keeps Simexco-linked farmers’ incomes on a strong upward trend over the long term.

Simexco also creates opportunities for farmers. By joining its supply chain, farmers have contract guarantees for standard-compliant products, giving them the confidence to invest and expand. Higher quality under Simexco’s guidance opens the door to premium markets (EU, USA, Japan), with better prices than domestic or small traders. As a result, farmers in Simexco’s chain earn higher value per kg than before. Notably, when Vietnam’s coffee exports hit nearly $5 billion in 2023 [12], Simexco-linked farmers benefitted more due to large, high-quality output ready for sale.

Project Partnerships and Support Funds – Financial Leverage for Income Growth

Simexco not only supports farmers directly but also connects them with projects and funding sources to further improve livelihoods. The company has partnered with the World Bank’s VnSAT project and local projects to invest in farmers: training, replanting credit, efficient irrigation, etc. With this support, farmers can more easily adopt new models; as the Director of Dak Nong Organic Cooperative admitted: “Without project support, it would be very hard for the cooperative to succeed with the landscape model” [13]. This shows that outside funding (concessional loans, grants) reduces cost burdens for farmers, raising their net income.

Simexco, together with international partners (e.g. IDH, JDE) and local government, has signed a public-private partnership agreement (PPI Compact) for sustainable coffee in Dak Lak. The target by 2025 is for 100% of 5,200 ha in the project to be under sustainable farming, 25% less irrigation, 15% fewer agrochemicals, and a 30% income increase for farmers [14]. Simexco commits to buying all project-area coffee and supports technical achievement of these goals [15][16]. Though 30% is only a minimum commitment, combined with other improvements (cost reductions, crop diversification, price premiums), real incomes can exceed this. Experts note that the landscape model reduces production costs by 11% and all products sell at a premium, creating superior profit over old practices [1]. Thus, projects and impact funds help speed up income growth and ensure it is long-term sustainable.

Farmers’ Income Increased by Over 100% – Summary and Comprehensive Evidence

In summary, all the above factors confirm that the income of farmers in Simexco’s sustainable value chain has increased by over 100% since joining. After more than a decade, many households have at least doubled their income thanks to coordinated improvements: higher yields, lower costs, higher prices, and added revenue from crop diversity.

Practical evidence to support our claim: According to VietNamNet, switching to carbon-reduction farming models (like Simexco’s) can double coffee farmer income [17]. Many households’ practicing regenerative agriculture have increased income by 30–100%, depending on change level [9]. Intercropping fruit/shade trees can boost average income per hectare by 200% (threefold) [7]. All these numbers are well above 100%, showing that “income increase over 100%” is fully achievable and already realized in practice.

More importantly, this income increase is not just a number but reflects an improved quality of life. Higher, more stable income allows formerly low-income farmers to reinvest in their farms, their children’s education, and skills, thus escaping poverty sustainably. They also become skilled workers, cooperative members, and environmental stewards—long-term values beyond money. In short, Simexco’s sustainable journey since 2009 has delivered outstanding economic benefits, as shown by more than doubled farmer incomes, plus positive social and environmental impacts in rural Vietnam.

References:

[1][6][13] Achieve sustainability thanks to the landscape coffee model
https://vietnamagriculture.nongnghiep.vn/achieve-sustainability-thanks-to-the-landscape-coffee-model-d350421.html
[2][4][5] Meeting Members: Over a cup of coffee with SIMEXCO DAKLAK – Global Coffee Platform
https://www.globalcoffeeplatform.org/latest/2023/meeting-members-over-a-cup-of-coffee-with-simexco-dak-lak/
[3][8] Vietnamese Coffee: A Lesson in Portfolio Diversification – STiR Coffee and Tea Magazine | Global Business Insight on Coffee and Tea
https://stir-tea-coffee.com/features/vietnamese-coffee-a-lesson-in-portfolio-diversification/
[7][10][11] How Brazil and Vietnam are tightening their grip on the world’s coffee | Arab News
https://www.arabnews.com/node/1543956/business-economy
[9][12][17] VN coffee growers double income with carbon-emission reduction scheme
https://vietnamnet.vn/en/vn-coffee-growers-double-income-with-carbon-emission-reduction-scheme-2289414.html
[14][15][16] Vietnam: Public-private agreement to support coffee farmers to adapt to climate change
https://idh.org/news/vietnam-public-private-agreement-to-support-coffee-farmers-in-adapting-to-climate-change