Radical reform can restore coffee industry sanity

It is unfortunate that while demand for Kenya’s coffee is strong on the world market and prices are at an all-time high, the country is unable to supply quantities needed.The once vibrant Kenya Planters Co-operative Union (KPCU), an umbrella body that used to offer a collective position of the coffee farmers, including purchasing fertilizer and chemicals on their behalf from the world market, is on its knees.Crafty cartels and unscrupulous dealers are eyeing assets of KPCU and want to purchase them at throw away prices, without considering the fact that these Sh 6 billion worth of assets was put up and is owned by impoverished and poorly educated coffee farmers.It is the tight local supply and impressive prices that is driving criminal elements, some with tacit support from owners of private coffee mills, to steal coffee beans from warehouses and factories or even ripe cherries from the farm.Although a committee of parliament has made recommendations on what steps are needed to revamp operations at KPCU, it is still unclear why the outfit was placed under receivership over a Sh 700 million debt, an amount that is not even a tenth of its asset value.Noisy exchangesWhile self-inflicted problems exist at KPCU, Kenya’s coffee farmers should take full advantage of existing conditions on the world market to make impressive returns.Their focus should be on accessing cheap fertiliser and chemicals as well as seedlings, a tall order considering the chaos and noisy exchanges prevailing in the business today.But perhaps the biggest threat facing coffee production in Kenya is threat from real estate and other competing land uses, wiping out acreage under the crop.In the ongoing land reforms, there is need to enact laws to protect agricultural land, including those under coffee, tea and horticulture from competing interests and uses including such activities as road construction and infrastructure related to urbanisation. There is also need for Coffee Research Foundation (CRF) to speed up plans to introduce coffee planting in South Nyanza and Teso districts, areas already identified as suitable for Robusta Coffee.While most farmers harvest only 2 kg per tree of coffee berries, this is still way below an optimum of 40 kg per tree, that level can be attained if coffee farmers are properly trained in plant husbandry.Kenya only produces 50,000 metric tonnes of coffee per year, far below world demand and not anywhere near the 100,000 tonnes level reached in the 1970s.Instead, activity has shifted to less productive activities including stealing of coffee beans from warehouses, factories and homes as well as from the farm.An estimated 150,000 hectares of arable land in Kenya is planted with coffee. The industry supports some 700,000 small-scale farmers and families bring the total number of people depending on this industry to 3.5 million. It is therefore apparent that living activities and strategy in this industry at the hand of profit-driven merchants, spells doom and despair.Restoring the coffee industry’s past glory requires deliberate state intervention, which can only be done through the KPCU infrastructure.We suggest that plans should be made to promote local consumption of coffee in Kenya, to provide farmers with an alternative option when there are upheavals on the world market.KPCU has the capacity to enable cheaper importation of such inputs such as fertiliser and spray chemicals for farmers.The challenge lies in increasing productivity, yield per tree and improving quality, aspects that Kenya could work on to dislodge Ethiopia and Uganda, leading coffee producers in these parts of the world.supply networkIn the 2010/11 season, five big millers handled over 88 per cent of all coffee milled in the country. What this means is that a lean and efficient KPCU is needed if it is to survive a liberalised coffee milling business.KPCU still has comparative advantages such as vast pieces of land and warehousing facilities as well as a supply network.What is needed is a complete overhaul of KPCU, to bring it up to speed with a liberalised and ferociously competitive coffee business.Allowing the giant union to go down and its assets sold off cheaply will not only expose farmers to exploitation but also open up the business to manipulative tendencies of powerful vested interests, business cartels and criminal gangs.

Radical reform can restore coffee industry sanity

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