LOST SHINE

Kenya's coffee sector decline shows no signs of stopping

The cash crop used to be one of the country’s top foreign exchange earners

In Summary

• The latest data from KNBS shows that the quantity of coffee exported plunged 19 per cent to 2,129 metric tonnes in Jan 2021 from 2,639 metric tonnes in Jan 2020.

• The value of the exports soared 36 per cent to Sh1.3 billion from Sh985 million, on account of a weak shilling. 

A coffee plantation
A coffee plantation
Image: FILE

Kenya's coffee sector has been on a steady decline in recent years because of low returns and mismanagement.

The latest data from KNBS shows that the quantity of coffee exported plunged 19 per cent to 2,129 metric tonnes in January 2021 from 2,639 metric tonnes in 2020.

The value of the exports soared 36 per cent to Sh1.3 billion from Sh985 million, on account of a weak shilling which was trading at highs of Sh110 to the dollar in January.

Coffee production in the country, which is nearly 1 per cent of the total global output, has also been on a decline.

Production levels peaked at 130,000 tonnes annually in the late 80s, but stands at 40,000 tonnes presently.

The majority of the smallholder coffee farmers are producing less than 2kg per tree per year against an annual potential of 35kg per tree.

According to the US Department of Agriculture, Kenya's total exports were 620,000 60-kg bags in 2020, down from the 815,000 bags exported during the immediate previous season.

The share of Kenya’s coffee in markets such as the US and South Korea has been also slowing down. In 2019, the US consumption of Kenyan coffee dropped to 11.78 per cent down from 13.28 per cent in 2018.

Although South Korea’s market share of the Kenyan coffee exports increased to 9.44 per cent in 2018 from 6.43 per cent in 2017, the volumes dropped again in 2019 to 6.51 per cent.

The country recently launched a Sh1.5 billion revitalisation programme aimed at shielding coffee farmers from exploitation and safeguarding what used to be one of the country’s top foreign exchange earners.

The programme, funded by the World Bank, is Kenya’s latest attempt to revive the sector. It complements the government’s Sh3000 million Cherry Revolving Fund set in motion in January to provide affordable, sustainable and accessible advances to smallholder coffee growers.

President Uhuru Kenyatta also extended the term of the Coffee Sector Implementation Committee so it can oversee the findings of a reforms task force.

The task force had recommended changes in the crop’s regulatory framework, promotion of specialty coffee, increasing involvement of the youth and turning the Nairobi Coffee Exchange into a public limited company.