Coffee farmers to Gachagua: Weed out cartels and fix pricing of our produce

As Deputy President Rigathi Gachagua takes on the monumental task of streamlining the coffee sector, players in the lower end of the value chain have pitched ideas on how he can turn around the once highly profitable industry.

Under the umbrella lobby National Coffee Cooperative Union (NACCU), farmers led by chairman Francis Ngone have backed the latest call for reforms, and putting on the table their ideas for consideration.

The union is now calling for the separation of roles in the value chain to neuter cartel-like actors, who undercut farmers by hogging all aspects of coffee processing, from production to marketing.

Instead, the farmers are rooting for measures to differentiate the roles of each player in the industry, which they feel currently weighs heavily in favour of the marketer, leaving thousands of farmers, who toil hard with little to show for their labour.

“If the reforms come into effect, the marketers will have a role they can play, but play it differently. What is major in the reforms is the issue of one person milling and sometimes involved in the production at society level taking the milling, taking the marketing and buying,” he said.

The coffee farmers’ lobby was especially concerned with the stark variation in coffee prices between the Nairobi Coffee Exchange (NCE) and the one in New York, observing that whereas local farmers sold the beans at $180 (Kes22,311) at the NCE, the same was fetching $700 (Kes86,765) in New York.

Read also: Tea farmers savor Sh5.5 billion windfall on bumper crop

Farmers are also seeking a more liberal approach to trading at the NCE which, they believe will guard their interests and lead to better compensation for the coffee producer.

“We would like to request the Capital Markets Authority to urgently rid the corrupt, cartel behaviour at Nairobi Coffee Exchange and introduce transparency in this institution such that even a small-scale farmer and co-operative can freely trade their coffee and walk home with money in their pocket,” Mr Ngone said.

Under Executive Order 1 of 2023, President William Ruto tasked Mr Gachagua with steering the Coffee Sub Sector Reform Implementation Standing Committee.

About 700,000 small-scale and large-scale farmers are involved in farming coffee, which is one of the major cash crops in Kenya.

The business impacts a further five million people indirectly in the value chain.

According to market and consumer data tracker Statista, In August last year, Kenya exported coffee worth Kes2.48 billion. The value, however, decreased compared to the preceding month, when the country earned about Kes3.82 billion in coffee exports.

In Kenya, coffee is grown in the counties around Mount Kenya, the Aberdare Range, Kisii, Nyanza, Trans Nzoia, Nakuru, Kericho and on a smaller scale in Machakos and Taita hills in Eastern and the coastal regions.

The Deputy President plans to smooth out the coffee, milk, and tea sectors which have been stymied by saboteurs in the past at the expense of farmers.

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