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The Standard Group Plc is a multi-media organization with investments in media
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WHAT THOSE FIXING THE COFFEE INDUSTRY SHOULD KNOW

Leonard Khafafa
By Leonard Khafafa | Oct 03, 2023

Harvested coffee at a farm in Nandi Hills, Nandi County. [Christopher Kipsang,
Standard]

There has been talk of faceless puppeteers who have gamed the intricate coffee
system of production and sale.

Cartels have been blamed for holding the industry in their thrall. Stakeholders
hope that intractable problems will soon be resolved over a cup of coffee.

Coffee has been grown as a cash crop in Kenya from the 1900s. Statistics from
the Coffee Year Book 2021-2022 reveal that it is the fifth largest foreign
exchange earner contributing 0.2 per cent of Kenya’s GDP. It is also the
mainstay of 1.5 million households in the country, mostly in rural areas.
Stakeholders in the coffee industry include individual farmers, farmers’
organisations, millers, warehousemen, marketers and coffee buyers. 



Coffee in the country is grown by smallholder farmers and estates. Upon
harvesting, coffee cherries undergo two processes: Wet milling which is the
removal of the outer skin and pulp and dry milling which removes the parchment
from the beans. The green beans are then graded, sorted and packaged for export.

This article does not propose solutions to all the challenges facing the coffee
industry but merely points out some facts. Some of these facts may be
inconvenient truths. For starters, some of the so-called 'cartels' are actually
big buyers with a global footprint. That they control the industry is by dint of
trusted supply chains built over decades. These big buyers have an established
chain of custody that tracks the sourcing, production, processing, shipping and
retailing of coffee at every stage. Moreover, they have certifications that
prove their exports are ethically and socially acceptable. New entrants into the
buyer markets would be constrained to meet these standards.

Second, beyond dry milling, there is little more that can be done in terms of
value addition. It has been suggested that Kenyan coffee should be roasted and
branded before being shipped overseas. However, the delicate nature of coffee
does not lend itself to this suggestion. This is because roasted coffee has a
limited shelf life and begins to deteriorate after the process. Further,
different roasters overseas have preferred roasting techniques that produce
their own distinct flavours and aromas.

Third, coffee in Kenya is not your cup of Joe. It is not a poor man’s drink but
an elitist pastime favoured by the well-heeled. The Coffee Year Book puts
domestic consumption at a paltry 3 per cent of national production. That means
97 per cent of the 50,000 metric tonnes Kenya produces is exported. The country
therefore cannot withhold its coffee from the global market as leverage for
better prices. Unlike Ethiopia that consumes 53 per cent of what it produces,
there would be no domestic uptake in Kenya. 

Finally, there are two ways to increase farmer earnings. The first is to
commoditise Kenyan coffee. This would entail increasing the acreage under
coffee, currently in serious competition with other investments like real
estate. The second is to grow specialty coffee with desirable characteristics
like physical density, vibrant acidity, intense cup profile and distinctive
aromatics. This would fetch higher prices than the usual green beans. One hopes
that those fixing the coffee industry are cognisant of these facts. Or maybe
they should wake up and smell the coffee!



-Mr Khafafa is a public policy analyst

 


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