Coffee farmers from Gatundu South in Kiambu are up in arms with the government over the delicensing of most private millers in the county; a situation they say has caused them to only channel their produce to the New Kenya Planters Cooperative Union (NKPCU).
The farmers claimed that most millers in the coffee-growing county have shut down milling business after they failed to secure operational licenses from the county government as required by Coffee Regulations 2019.
According to the regulations, a person shall not establish or operate a coffee nursery unless the person is licensed by the respective county government.
Unlike in other counties where private millers have been licensed and continue to process the farmers’ produce, farmers in Gatundu South decried that they are forced to expensively transport their produce, for milling, to Nairobi.
Speaking after a meeting at Kimaraita Farmers’ Cooperative Society in Gachika village, the farmers lamented that failure to license the milling firms where they have been channelling their produce has denied them freedom to choose where to mill their produce.
The move, they added, has seen them incur losses in transportation and have at the same time not been able to sell their produce to the highest bidders as they only have a single firm to channel their harvests to.
“We want millers like Tropical and Sasini to be licensed so that we can continue selling our coffee to them. The government should not coerce us to sell our coffee only to KPCU because we know how impoverished farmers are in the yesteryears,” farmer Paul Kimani said.
Kimani farmers decried that while the government promised them that their coffee would earn them between Sh 40 and 80 per kilo of coffee berries, most coffee farmers are still impoverished and unable to meet their obligations due to low returns.
Judy Wanjira, a mother of two whose children have been sent home over school fees arrears said that despite their hard work, efforts made by farmers do not pay back owing to mismanagement and bad government policies.
“Failure to open the market for competition by millers has denied farmers a chance to explore opportunities for better returns,” Wanjira said.
In a bid to get rid of the coffee subsector of cartels who have allegedly been reaping farmers off their profits, the government in June last year delicensed all coffee value chain players who were obligated to apply for licensing afresh for consideration by the government.
While millers in other counties got their licenses and resumed operations, Githunguri MP Gathoni Wamuchomba who was at the farmer’s meeting also decried that those in Kiambu County have been denied the crucial certification.
Wamuchomba called on the local government leadership and the national government to stop sabotaging the production and sale of coffee produce from the county to cushion farmers from further losses.
“There are attempts to return the monopoly of KPCU in the coffee sector and we all know where it left farmers. We want farmers to have the freedom to sell their coffee where they want. again we want the licenses of millers in Kiambu County to be renewed,” she said.
Meanwhile, the farmers called on the government to reconfigure the distribution of fertilizer systems to ensure they start getting the farm input on time.
They lamented that they have been walking long distances to secure fertilizer which they further said is never enough to feed their plantations.
Raw coffee has to be processed and that is what millers do to sell coffee to consumers at Starbucks and millions of other places. That is the logic of the business from the coffee farmer to literally billions of people who drink coffee everyday.
Then came the fallacy by Gachagua that coffee millers were cartels that had to be dumped in the KK garbage pit. They did that and told coffee farmers that Starbucks will buy coffee directly from Kenyan farmers. Just nonsense.
The coffee industry is complicated and we are fortunate to be a key party in how the world gets their coffee and pay for to also benefit coffee farmers and workers in our country.
This was a story that was bought to our attention by people and business companies who work in the coffee industry.
The Licensing Quandary:
A concerning aspect of this crisis is the sharp decline in the number of coffee buyers registered at the NCE. Out of the 121 coffee buyers licensed by the Agriculture and Food Authority for the 2023/24 season, only 58 have chosen to participate in the auctions. This phenomenon is a direct result of contracted millers who have been unable to secure trading permits issued by county governments. The ensuing disruption in the flow of coffee to the exchange has discouraged international buyers, ultimately leading to a decreased global demand for Kenyan coffee.
Price Plunge:
Perhaps the most alarming aspect of this crisis is the drastic drop in coffee prices. The average cost of a 50-kilogram bag of coffee beans has plunged by a staggering 31.13 percent. In concrete terms, it has fallen from Sh266.32 (US$1.81) to a meager Sh183.41 (US$1.24). This price plunge, coupled with the decline in sales volumes, has created a perfect storm that threatens the financial stability of coffee farmers and traders alike.
Root Causes and Implications:
The dramatic decline in auction volumes can largely be attributed to contracted millers’ inability to secure trading permits, disrupting the flow of coffee to the exchange. This, in turn, has deterred international buyers from entering the market, leading to a decrease in global demand for Kenyan coffee. Furthermore, the suspension of trade permits for coffee millers has pushed them to contemplate the grim prospect of laying off thousands of workers, a move seen as essential to reduce costs.
The Future Hangs in the Balance:
The coffee crisis in Kenya is further exacerbated by the fact that no coffee has been certified in the current licensing cycle that began in July. This has prompted global coffee roasters, including the renowned US-based chain Starbucks, to seek alternatives outside of Kenya. Jack Marrian, a member of the Kenya Coffee Traders Association (KCTA), paints a bleak picture, saying, “Every day roasters are calling us and telling us they want coffee but we have to tell them that we have no coffee. These roasters are moving to alternative markets, and once they turn away from Kenya, there is no bringing them back.”
Conclusion:
The Kenyan coffee industry is at a crossroads, facing one of the most significant crises in its history. Plunging prices, dwindling sales volumes, and disrupted reforms threaten the livelihoods of countless individuals who depend on coffee cultivation and trade. The industry must now come together to find solutions, navigate these turbulent waters, and ensure that the rich tradition of Kenyan coffee remains alive and thriving. The world is watching, and the fate of Kenyan coffee hangs in the balance.
This is what we said when we saw the mess coming in. It is here now.
