This archive report was first published on 10 December 2019.
Published on December 10, 2019, a report by the Global Agricultural Information Network (GAIN) highlights the uncertain future of Kenya's coffee sector.
The US Department of Agriculture Foreign Agriculture Service's assessment, which contributed to the GAIN report, forecasts a significant drop in Kenya's coffee production in the marketing year 2019/2020 due to low prices and the persistent shift of coffee producers to less risky enterprises.
Government of Kenya (GOK) coffee sector reforms are also falling short, according to the report. Efforts to promote smallholder coffee production in non-traditional growing areas are being countered by a surge in housing developments on farms located in peri-urban areas, leading to an overall stagnation of total coffee production.
The success of the 'cash-on-delivery model' piloted in 2017/2018 in selected coffee marketing co-operatives is already in doubt, with industry sources attributing its lack of smooth take-off to low farm productivity and fragmented co-operative units.
Kenya's coffee sector is characterized by small farms, with the size of coffee farms decreasing due to inheritance-driven sub-division. The country has more than 500 coffee marketing co-operatives, all geared to marketing fewer than 900,000 bags of coffee annually.
Kenya has two distinct harvest seasons in a year, each of which peaks for less than two months. According to Kenya's coffee directorate, 20% of coffee mills are currently operating at their lowest levels.
Despite elaborate plans, Kenya is yet to fully liberalize the coffee sector to let the private sector fully undertake critical marketing roles and assume associated risks. Both the existing policy and legal frameworks place immense risks on the producer, even in instances where farmers are unable to bear these risks.
