Pilot Ethiopian model shows signs of helping Meru coffee farmers thrive

By Wainaina Ndung’u | Monday, Sep 3rd 2018 at 21:54
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Silas M'Rinyiru, 99 at his coffee plantation in Kirwirwa Estate in Yururu, Imenti South on August 15, 2018. [Olivia Murithi, Standard]

Up to 35 coffee co-operative societies have signed up for a pilot payment model that promises prompt and better returns.

The societies, plus a union of 60 plantation farmers, are trying out an Ethiopian system through which they are paid Sh20 per kilo in advance for all coffee delivered by the end of the month.

The payments are guaranteed by the tenth day of the subsequent month.

Co-operatives societies will also receive a further Sh3 per kilo delivered to run their factories.

Through the new system operating under the Meru Coffee Co-operative Millers Ltd, farmers are delivering almost 40,000 bags of coffee - up from 25,000 bags last year.

Farmers who have signed into the scheme control 130 coffee factories including 70 belonging to small-holder planters.

“The objective of this model is to prevent farmers from hawking their produce cheaply for quick money. Now we are seeing more of our co-operatives opting to wait for better prices through possible direct sales deals,” said Meru Coffee Co-operative Millers Ltd General Manager Duncan Marete.

The societies have directed the miller, who is also their marketing agent, to scout for opportunities for direct coffee sales that will guarantee them higher prices than those offered at the Nairobi Coffee Exchange (NCE).

Legal requirement

The law requires all produce sold through direct sales to have prices above those offered at the NCE.

According to Mr Marete, only limited amounts of low-quality and light category coffee have been sold at the NCE while samples of produce in the premium P1 and P2 categories have been sent to the best buyers for possible direct sale deals.

A number of farmers called for improvement of the system to provide for advance payments before coffee harvesting commences.

"Coffee harvesting is an expensive affair that requires ready cash as labour is paid daily at Sh80 per container or Sh300 per day excluding transport and meals," said Henry Kinyua, who is affiliated to Katheri Coffee Farmers Co-operative Society Ltd.

However, he said the future looked brighter for the sector under the pilot system and hoped it would be streamlined.

 

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