Licensing dispute pits big coffee companies against farmers' lobby

Coffee cherries drying process in Nandi Hills Constituency. [Christopher Kipsang, Standard]

A fresh row has rocked the country’s lucrative coffee marketing sector after two multinationals, whose licenses had been revoked as part of so-called reforms by the government were freshly approved.

Sasini Plc Ltd and Kofinaf Company Ltd regained their entry into the multibillion-shilling coffee market after they were issued licenses by the Kiambu County government last week, according to the National Coffee Co-operative Union (NACCU).

In a statement seen by The Standard, National Coffee Co-operative Union Chief Executive Festus Bett said the move is in total contravention of the Crops (Coffee) (General) Regulations 2019, which state that a holder of a coffee buyer’s license or any other entity associated with such holder shall not be licensed as a commercial miller, broker, roaster, agent or warehouseman.

“We NACCU and our affiliate primary societies in shock learned yesterday of a move by the county government of Kiambu to issue milling licenses to a section of commercial millers namely Sasini Plc Millers and Kofinaf Company Ltd while this is in direct contravention of the Crops (Coffee) (General) Regulations 2019,” said Bett in the statement.

According to Bett, Sasini Plc Mill is affiliated with Sasini (K) Ltd, which has similarly been participating as a buyer on the Nairobi Coffee Exchange (NCE).

“We know that Sasini Plc Mill is affiliated with Sasini (K) Ltd, which holds a buyer’s license issued by AFA (Agriculture and Food Authority) and has actively been participating in the auction as buyers as shown in the information below derived from NCE dealer’s Purchase report,” said Bett.

“Kofinaf Company Ltd Mill is affiliated with Coffee Management Services (CMS) and C. Dormans Ltd who handed over their management to CMS in Kiambu, a sister company to C.Dormans who are licensed as buyers by AFA (Agriculture and Food Authority) and have been actively participating in the auction as buyers as per the NCE  dealer’s purchase report,” added Bett.

Bett, whose lobby represents the over 800,000 small-scale coffee farmers, now wants Deputy President Rigathi Gachagua, who was tasked to oversee reforms in the coffee sector, to direct AFA and the Coffee Directorate to intervene.

They also want Gachagua to order an inquiry into how the licensing occurred. “Could there have been commercial benefits or incentives between the licensee and officials of the county government of Kiambu?” he posed in the letter sent to the Deputy President and copied to Cooperatives Cabinet Secretary Simon Chelugui and Council of Governors CEO Mary Mwiti.

Also in the crosshairs of the coffee lobby is CMS Mills Eldoret, which according to Bett obtained a commercial milling license from the county government of Uasin Gishu, while they are affiliated with C. Dormans.

The Standard could not immediately reach the Deputy President’s office yesterday, Dormans, CMS Mills and Kofinaff by press time.

This is the latest controversy to rock the coffee sector amid plans to revamp farmers’ incomes. The reforms, which started during retired President Uhuru Kenyatta's era were heightened when President William Ruto tasked his deputy to head the Coffee Sub-Sector Reforms Implementation Standing Committee.