The FINANCIAL -- As part of its ongoing efforts to help elevate the coffee industry in China’s Yunnan Province, Starbucks Coffee Company announced that it has signed an agreement to form a joint-venture company with Ai Ni Group, one of the province’s most established coffee operators and agricultural companies in Yunnan.

According to Starbucks Corporation, the joint-venture company, which will be controlled by Starbucks , will purchase and export high-quality arabica Yunnan coffee beans, as well as operate dry mills in the province.

John Culver, president, Starbucks China and Asia Pacific, and Liu Minghui, Founder and Chairman, Ai Ni Group, each representing their respective companies, attended the signing ceremony today in Kunming, Yunnan’s provincial capital. Vice Governor Gu Zhaoxi, Yunnan Provincial Government, witnessed the ceremony.

With the establishment of the joint venture, Starbucks aims to increase its coffee-sourcing activities in the Yunnan region for use in the company’s global blends, and build long term relationships with Yunnan’s coffee farmers. The joint-venture company will also adopt ‘best practice’ processing methods to ensure a consistent and reliable source of quality coffee for Starbucks .

Beyond the joint venture, the Starbucks Farmer Support Center in Pu’er City, which will provide agronomy consultation services and support to Yunnan’s coffee growers, is expected to be operational this year. In addition, the importation and local adaption tests for coffee seed varietals, conducted in collaboration with the Tropical and Subtropical Cash Crops Research Institute of the Yunnan Academy of Agricultural Science , are progressing on track and within expectations. Through these various initiatives, Starbucks aims to develop a complete value-chain in China – from coffee seed to the authentic Starbucks Experience in stores.

Starbucks collaboration with Yunnan province coffee farmers and suppliers reached a major milestone with the launch of Starbucks South of the Clouds Blend in early 2009. With support from the provincial government, Starbucks worked closely with coffee farmers and suppliers in the Yunnan region to create Starbucks first coffee blend that featured high-quality arabica coffee beans from the region. Starbucks South of the Clouds Blend is now sold across numerous Starbucks locations across Asia and the United States.

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