Union steps up bid to raise farmers' representation in Coffee Exchange

Coffee cherries drying in Nandi hills constituency in Nandi County. [Christopher Kipsang, Standard]

A coffee union wants farmers’ representation at the Nairobi Coffee Exchange (NCE) increased to better articulate their issues.

The National Coffee Co-operative (NACCU), an umbrella body which draws its membership from all 31 coffee-growing counties in Kenya, feels representation is skewed against producers despite their critical role in the coffee supply chain.

Beginning March 3, the Capital Markets Authority (CMA) licensed brokerage firms have been receiving lot range allocations and Broker codes from NCE, signalling their admittance to trade at the auction. 

This is the first time in Kenya's history that smallholder coffee farmers will be trading their coffee at the Exchange with no intermediary.

“NACCU believes that it is critical to ensure that all licensed brokerage firms are adequately prepared for trading at the Nairobi Coffee Exchange,” said the union in a statement Wednesday after a capacity-building workshop for the brokers in Nairobi.

“The capacity building workshop is, therefore, aimed at equipping brokerage firms with the relevant skills and knowledge necessary to effectively sell coffee on behalf of coffee farmers.”

The union thanked the Parliament’s National Assembly for the recent annulment of the Crops (Coffee) (General) (Amendment) Regulations, 2022 by the National Assembly, arguing that the two sets of regulations which currently regulate the coffee sector are the Crops (Coffee) (General) Regulations, 2019 and the Capital Markets (Coffee exchange) Regulations, 2020.

Through this move, CMA argued, the union is now the government agency legally mandated to oversight and regulate the coffee trading at the local Nairobi Coffee Exchange under Capital Markets (Coffee Exchange) Regulations, 2020.

CMA earlier issued a press release on the licencing of four new coffee brokers, namely Kinya Coffee Marketing Agency Ltd, Kiambu Coffee Marketing Company Ltd, Bungoma Union Marketing Agency Ltd and Meru South Coffee Marketing Company Ltd. 

This was in addition to six other coffee brokers holding valid licences that had been licensed in June 2021. 

They include United Eastern Kenya Coffee marketing company, Meru County Coffee Marketing Agency Ltd, Kipkelion Brokerage Company Ltd, Mt Elgon Coffee Marketing Agency, Murang'a County Coffee Dealers Ltd and Embu Coffee Farmers Marketing Agency.

Delay in admitting them resulted in the Capital Markets Authority writing to NCE and prevailing on them to admit to the trading floor all the duly licensed coffee brokers pursuant to section 22A of the Capital Markets Act and regulations 3(f), 6(h) and 33(1) of the Capital Markets (Coffee Exchange) Regulations.

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