PETITION

Coffee farmers, brokers ask Parliament to help resolve sector wrangles

Last week, the Senate Committee on Agriculture accused Munya of playing politics in the coffee industry thus

In Summary
  • Kiambu farmers have supported the proposed bill
  • NCE recently rejected the United Eastern Kenya Coffee Marketing's request for admission to the auction market
A coffee farmer picks ripe berries.
COFFEE SECTOR: A coffee farmer picks ripe berries.
Image: REUTERS

The adoption of new coffee varieties to replace the old coffee estate will help Kiambu farmers regain their past glory that is being dimmed by real estate. 

Speaking during public participation for the Coffee Bill, 2021 held at Ngewa Primary School in Kiambu, farmers led by Komothai Coffee chair Joseph Ndung'u and local MP Gabriel Kago decried the sorry state of coffee farming in the region and the country at large.

They now want the government to facilitate them uproot 50-year-old plantations to enable them to grow fast and high-yielding varieties.

''Low yield and poor returns have seen farmers opt for a lucrative real estate sector. This can be remedied by high breed varieties. Government must support farmers for two three years as they transit,'' Githunguri MP Gabriel Kago said.

Farmers present endorsed the proposed law saying it is more farmer-centric than the rival one proposed by the Senate. 

Kiambu County leads the country in coffee production, with official data from the Ministry of Agriculture showing the region accounts for 20 per cent of Kenya's production. 

Under the proposed law, coffee factories will be permitted to register as autonomous societies under the Cooperative Societies Act if they so desire or if the members want them registered as such.

This means that factories will no longer be forced to belong to larger cooperatives.

The farmers used the event to amplify the coffee federation's petition to the Parliament to ask the Nairobi Coffee Exchange (NCE) to admit duly licensed brokerage firms with immediate effect in compliance with the law.

They asked the National Assembly's Departmental Committee on Agriculture and Livestock led by Moiben MP Silas Tiren to act with speed and help resolve a standoff that is likely to hurt coffee farming in the country.

On Wednesday, the National Coffee Co-operative Federation of Kenya (NCCFK) scoffed off a recent move by the coffee exchange to denied recently licensed brokers access to the auction for trade.

In a petition to the National Assembly seen by the Star, the federation said the Coffee Exchange Regulations mandate NCE to give reasonable access to the auction for all persons licensed to trade and empower CMA to direct NCE to facilitate the participation at the auction.

''There no policy or law that supports the NCE’s rejection to admit a duly licensed brokerage firm,'' the cooperative union said in the petition. 

On August 19, NCE rejected the United Eastern Kenya Coffee Marketing's request for admission to the auction market and allocation of lots range and brokers code.

The coffee exchange cited a legal notice 104 and the need to seek an advisory opinion from the Cabinet Secretary for Agriculture, Livestock, Fisheries and Cooperatives.

Even so, the coffee union insists the notice has since been revoked by CS Agriculture hence cannot legally be used to deny licensed coffee growers access to the exchange to trade their coffee.

Brokers also accused NCE of operating without a board, saying that the legality of its incorporation is still an issue.

This new development is expected to exacerbate a simmering row between the Ministry of agriculture, marketing agents and CMA.

On July 1, 2021, CMA granted Meru County Coffee Marketing Agency Ltd a full coffee broker licence after fulfilling the stipulated conditions though the company is trading under the old license.

At the same time, the stock markets regulator awarded conditional licenses to Kipkelion Brokerage Company Ltd, Murang’a County Coffee Dealers Company, Mt Elgon Coffee Marketing Agency Ltd and United Eastern Kenya Coffee Marketing Company Ltd.

Agriculture CS Peter Munya is on record dismissing the involvement of the CMA in licensing coffee brokers and supervising the NCE, it duplicates the role played by the coffee directorate.

Last week, the Senate Committee on Agriculture accused Munya of playing politics in the coffee industry thus frustrating reforms.

The committee chair Senator Njeru Ndwiga said Munya should follow the law so that the country can have coffee reforms as envisaged in Vision 2030.

According to the International Coffee Organisation (ICO), Kenya produced 790,000 60-kilogramme bags of green coffee in the 2017-18 year, about 0.5 per cent of the total world production of over 158.56 million bags.

Kenya contributed only about five per cent of East Africa’s output.

This is unlike in the 1970s and 1980s which were booming years for the crop and saw the commodity rise to be Kenya’s largest foreign exchange earner.