Producer Spotlight: Edith Orozco of Cooperativa Agroindustrial Machupicchu
Creating a Farmer Co-op in Andahuaylas, Peru
Forming a farmers’ cooperative was the best strategy imaginable for producers in Andahuaylas, Peru.
Recently, I had the pleasure of chatting with Edith Huaman Orozco, the general manager of the Cooperativa Agroindustrial Machupicchu.
In our hour-long conversation, Edith revealed the process behind the co-op’s origins, their experience with traceability, the impact of certifications, and more. She also provided a deeper insight on Andean grains and superfoods like quinoa and amaranth.
The Cooperativa Agroindustrial Machupicchu is situated in the department of Apurimac, in the province of Andahuaylas, Peru.
Their associates produce organic grains like quinoa, kiwicha (amaranth), and chia seeds. Being small-scale farmers, most of them might own a few plots of land, each measuring between ¼ and 1 hectare. They cultivate different crops on rotation, and their harvests are partially for personal or home consumption.
The price of quinoa has tripled in the last six years, and consumption has skyrocketed. Spain alone currently consumes up to 175 tons a year. However, it has been a nutritional pillar for Andean populations for over 5,000 years.
Remaining harvests can be commercialized. That’s where the co-op comes in.
The Cooperativa Agroindustrial Machupicchu takes care of the storage and quality assurance (grain size, humidity, sanitary conditions, packaging) required to meet their clients’ standards. Then they gather the products and package them for sale.
Producers used to rely on merchants for this service. Once the co-op was established, they had the opportunity to certify their products under an internationally-recognized organic certification. In addition, the Cooperativa Agroindustrial Machupicchu began making direct offers to export companies, which are now their biggest clients.
In the last few years, they made successful efforts to tap directly into the international market. Thanks to the cooperative’s Fair Trade certification, producers now reach clients overseas who only buy from certified organic and fair trade sources.
This move would have been impossible a few years ago.
Apurimac, Andahuaylas is a purely agricultural area. Farming is the predominant economic activity in the region. It is even larger than livestock farming. Edith’s parents and grandparents are farmers.
Edith had the opportunity to study economics and administration in Cuzco, with the aim of better understanding the markets open to her family and community.
The Origin of the Cooperativa Agroindustrial Machupicchu
The year was 2011. Edith had gone home for vacation. One morning, her father asked her to go to the municipality on his behalf and wait for a buyer to ask about the prices for quinoa and amaranth that year.
She went to a meeting that was taking place at the municipality that day, and the room was packed with producers from all over the valley.
The buyer was from Lima. At that time, he was the only buyer of Andean grains in Andahuaylas. Farmers were just starting to produce at high volume to meet growing market demand.
“The buyer that day was a catalyst,” Edith tells me during our interview. “He was a bully, holding his role over the farmers’ heads, almost pleased with their lack of alternatives outside of himself as an intermediary.
“And in a sense, he was right. He was the only one setting terms that day.”
The buyer spoke to one of the more prolific producers—the only one who had generated over 10 tons of product. He openly berated him over his prices, which were no higher than what he would pay in Cuzco or Ayocucho. Bascially, he chastised the producers for charging standard market prices.
he wasn’t wrong about his advantageous position. Farmers conceded to him, and even though many complained about a lack of fair compensation, the buyer had the final word that day. He left with harsh criticism of product quality.
“I believe there was no quality control back then—no way to protect the product from rotting without the use of clean, humidity-controlled, appropriate storage and conditions,” Edith adds.
It was a painful situation for her to witness. Soon after, when her father’s harvest was ready, she saw how a buyer from Puno took advantage of his need, paying much less than the market price.
Edith was plagued by feelings of impotence.
“That’s when it hit me: why don’t we form a cooperative?”
This way, the producers could combine their output, invest in certifications, control for quality, and reach better markets directly.
This solution would also guarantee farmers a market where they could demand a fair price for their work. They would no longer be forced to settle for whatever buyers felt like paying.
The original plan was to transform an already existing organization of producers into a cooperative. However, that year Edith met a representative of a non-profit organization from Belgium that promoted the production of quinoa for broader commercialization. This organization encouraged farmers to produce at a larger scale and thus earn more money.
Alfredo Vazquez, the nonprofit’s representative and an agronomist from Cuzco, was the one who had introduced the quinoa buyer to their community in the first place.
Edith asked him, Instead of going through the merchant first, why not sell directly to markets?
Alfredo pointed out a sobering fact. It is the buyer who pays for the organic certification–no selling or exportation can happen without it.
An Idea Is Born
Edith share her idea of creating a cooperative. What would happen if they were to create one themselves? That got him excited. Alfredo and Edith each put down 5,000 soles in an effort to ground their plans. Poetically, the next investor was the prolific farmer in the community who had produced over 10 tons of quinoa. He was the same one that the middleman said he wouldn’t buy from again.
This put them at 15,000 soles to start out.
Edith drew on contacts and resources of all sorts to form the cooperative. She recruited the help of a local credit and savings cooperative. Together, they created a presentation for the farmers about forming a co-op—how it worked, the advantages and disadvantages, everything.
It took a shift in strategies to get farmers excited about a new model and ready to transform their current situation. Edith and Alfredo gathered the leading producers at the home of José Salazar (producer from the municipal meeting in the valley). Over 20 producers showed up, and once again, Edith shared the plan to start a cooperative.
This time, the response was different.
“We saw the desire and excitement in the room and we proposed that everyone come back the next week with 100 soles to start. From there we would start delegating. The following Friday, 12 people, those most committed to the project, showed up with the capital investment, and that’s how it all started.”
They certified their product at once, got a new client willing to pay a much better price, became more competitive, and attracted many additional producers to join the cooperative.
Alfredo left not long after, and with him so did a key position of leadership. The co-op stumbled its way forward, delegating leadership to one of its producers. But Edith quickly learned that farmers don’t have the time to lead, keep a strategic eye on the cooperative—and also be farmers.
A Step Into Leadership
Edith stepped up to the plate, quit her former job, and took the reins of the operation. The cooperative continued to lead the community out of poverty and secure earnings for farmers to support their families.
They found allies in the local government and nonprofits and began to take action in multiple directions. They made changes to the quinoa seeds, developed a more substantial and less bitter product, increased the scale of production, and introduced organic methods. The co-op made Apurimac known for its premium quinoa.
Today, Andahuaylas is known to produce the highest-quality quinoa in Peru.
Check out Cooperativa Agroindustrial Machupicchu’s producer profile on Producers Market to learn more about their mission and product.