The government has registered remarkable successes in rejuvenating the coffee sub-sector, Cooperatives and SME Development CS Simon Chelugui has said.
Speaking at a media briefing on the progress of the coffee sub-sector reforms on Tuesday, Chelugui said the successes are a result of concerted efforts, strategic planning and unwavering commitment to turn around the industry.
“We have worked closely with all stakeholders including coffee farmers, cooperatives, marketers and international partners to ensure that our reforms are comprehensive and inclusive,” he told journalists.
He added that the government is keen to enhance transparency, improve farmers’ livelihoods and incomes, increase export earnings and ensure Kenya’s coffee continues to command its premium status in global markets.
Chelugui said the government continues to confront a myriad of unprecedented challenges in implementation of the reforms.
“Nonetheless, we have witnessed notable and tangible progress with enhanced productivity, improved market access and stringent quality control measures,” he said.
Coffee has been a leading export product in Kenya since 1963 up to late 1980s where the highest production was 129,000 metric tonnes in 1987/88.
This, however, declined to as low as 36,000 metric tonnes in 2019/20 financial year.
In the Sessional Paper No. 1 of 1986, Kenya had projected a production of 350,000 tonnes by 2000 going by the advancement in the development of better farming technologies and varieties, favourable coffee market and prices paid to farmers.
Chelugui said the government has reviewed existing licences (milling, brokerage/marketing agent, exporter, and warehouse manager) to build a robust coffee value chain and protect the interests of farmers.
The CS further said there is increased coffee sales at the Nairobi Coffee Exchange (NCE).
“The increase in average volumes traded underscores the positive impact of the reforms on the efficiency and transparency of price discovery,” he said.
Chelugui further cited the improved Payment Model (Direct Settlement System – DSS).
“The DSS is designed to expedite payment of Coffee growers’ proceeds and enhance transparency in recovery of statutory deductions as well as other service provider commitments owed by the grower,” he explained.
The CS added that the Cherry Advance kitty, managed by the New Kenya Planters Cooperative Union (New KPCU) has alleviated the cash flow challenges faced by farmers, enabling them to reinvest in their farm inputs and improve productivity.
Chelugui said the government has made significant strides in international market engagements.
He said plans are at advanced stages to establish warehouses in strategic locations such as Belgium, Dubai and Germany.
