The government has initiated reforms in the coffee sub-sector to address areas of data management, assess to farm inputs, access to affordable credit, corporate governance, processing and marketing.
So far, the Government has legislated on the Coffee General Regulations and Coffee Cherry Revolving Fund Regulation and also forwarded the Coffee Bill, 2021 to Parliament for deliberation and approval.
Agriculture Cabinet Secretary Peter Munya said through the New KPCU, over 300 million has been disbursed to farmers out of the Ksh3 Billion Coffee Cherry Revolving Fund set to coffee farmers across the Country.
He however noted that once disbursed one is supposed to pay immediately their coffee is sold and since currently most coffee farmers are being paid immediately once they supply the coffee large numbers might not seen accessing the said fund.
“we are reviewing the regulations to support farmers in other ways and despite it being intended for loaning, we want to see how the revolving fund can be accessed by farmers on other essentials such purchase of inputs and other essentials”, he explained during a Cooperatives leader meeting on reforms in the sector.
“This should be the preferred credit option to other available but expensive alternatives in the market place, the CS noted and urging all co-operative leaders from coffee growing areas to sensitize and facilitate their members to access the Coffee Cherry Advance Revolving Fund, which is disbursing cheap loans and advances to small scale coffee growers at an affordable interest rate of 3 percent per annum. .
The Ministry, the CS further said is undertaking performance audit in coffee co-operatives and supporting digitization and modernization of coffee factories infrastructure.
Under phase one, he noted that 25 coffee factories have benefited from the digitization programme and this year another 200 coffee factories are undergoing digitization while performance audits are being carried out in 300 coffee co -operative Societies.
The CS came out to clarify that Capital Markets Authority do not have the mandate to regulate the coffee trading at the Nairobi Coffee exchange saying this is an Agriculture Food Authority (AFA) mandate
CMA had last year after the amendment of the Capital Markets Act through Finance Act 2016, had said that the Spot Commodities market had been brought under the regulatory oversight of CMA thus mandated to license the Coffee Exchange and the Coffee Brokers.
Munya however noted that the transfer had not been done properly because the Crops Act was never amended.
“It is the ministry’s mandate, through the Crops Act, to extend any laws and CMA should restrict themselves to securities. The Ministry wants to create an overall agricultural commodities regulator that will oversee the trading of all agriculture commodities once AFA is restructured , Munya said
Government has been sweeping reforms in the Coffee sector just like many other in the Agriculture sector in conformity towards the governments big four agenda.
In the Coffee sector, Government has been looking towards farmers get details of how much their coffee fetched on the market, reduce wastage occasioned by processing and milling and also see them access the Ksh 3 billion cherry revolving fund.
By Wangari Ndirangu
