•Coffee production continues to decline locally from 129,000 metric tons in 1990 to a low of 34,000 in 2022 due to unaffordable inputs delayed payments and low market prices.
•On 31st January 2023, Capital Markets Authority (CMA) licenced four new coffee brokers.
Coffee farmers could begin trading their produce at the Nairobi Coffee Exchange (NCE) from April 10.
This is after the expiry of the 90 days given to coffee unions to get clearance from the Capital Markets Authority (CMA) and prepare to trade under the new regulations.
Under the regulations CMA becomes the government agency legally mandated to oversight and regulate the coffee trading at the Nairobi Coffee Exchange.
The National Coffee Cooperative Union (NACCU) the umbrella body for coffee cooperative unions in Kenya says that the move will bring sanity, fair-trading practice and eliminate collusion at the auction.
NACC chairman Francis Ngone, acknowledged that the process is still facing challenges as some unions have running contracts with the marketers.
“By around tenth of April that will be the time that everything will be in a manner that we can officially start,” said Ngone
The regulations come at a time when coffee farmers are grappling with low market prices an this has seen them hold onto the commodity.
“We know there are some coffee from the season that has just ended what do we do about that? We are also coming to the end of the coffee seasons this we will handle as time goes. Right now we are finishing up with the operation structure,” said Ngone.
According to NACCU, which draws its membership from the 31 coffee growing counties in Kenya, the move is likely to improve earnings for farmers and ensure timely payments.
It however comes at a time when coffee production continues to decline locally from 129,000 metric tonnes in 1990 to a low of 34,000 in 2022 due to high cost of inputs, delayed payments and low market prices.
Last year Kenya produced 34,500 tonnes of coffee, with cooperatives producing 15,000 tonnes while estates produced 11,000 tonnes
Francis Wekesa finance and planning director at the Co-operative ministry said the area under coffee production in Kenya currently stands at 108,199 hectares.
“There are over 28,000 registered cooperatives with an asset base of over Sh1.5 trillion, with cooperatives having 83,173 hectares and estates having 25,000 hectares,” said Wekesa.
The changes come at a time that CMA has extended the approval granted to NCE to continue operating as a coffee exchange to April 30, 2023.
In January, CMA licensed four new coffee brokers, namely Kinya Coffee Marketing Agency Limited, Kiambu Coffee Marketing Company Limited, Bungoma Union Marketing Agency Limited and Meru South Coffee Marketing Company Limited.
This was in addition to six other coffee brokers already holding valid licenses issued in June 2021.
They wrote to the Nairobi Coffee Exchange seeking admission but the delay saw CMA write to NCE and prevailed upon them to admit to the trading floor all the duly licensed coffee brokers.