Rules: Coffee marketing set for major overhaul
Kenya’s multi-billion shilling coffee trade is at risk of disruption after the government early this week nullified regulations managing promotion of the commodity. Agriculture and Food authority (AFA) on January 17 wrote to various coffee stakeholders, notifying them of the withdrawal of the Crops (Coffee) (General) (Amendment) Regulations, 2022.
Nullification of the regulations implies that licences issued to the current commercial marketing agents that trade coffee for the 2022/23 are illegal and thus has to seek new permits.
Although AFA acting director General Beatrice Nyamwamu did not indicate the reason that prompted the government to withdraw the regulations she said marketing of the crop will be undertaken under new set of regulations.
This implies that companies licensed by Capital Markets Authority (CMA) as coffee brokers will be allowed to start trading at the Nairobi Coffee auction hall.
The coffee 2022 regulations were put in place last June by former Agriculture Cabinet Secretary Peter Munya after expiry of licenses of coffee marketing agents that had been extended for two consecutive years – 2020/21 and 2021/22 crop years.
Munya had dismissed the Capital Markets Authority (CMA) role to license coffee brokers and supervise the Nairobi Coffee Exchange (NCE), saying the stock market regulator is not properly structured and mandated to oversee marketing of the coffee in the country.
The former CS was opposed to the Crops (Coffee) (General) (Amendment) Regulations, 2019 and Capital Markets Coffee Exchange Regulations, 2020 for introducing brokers to replace marketing agents and new governance structures.
National Assembly Agriculture Committee chairman, John Mutunga had hinted during a phone interview in December last year that the regulations would be withdrawn, accusing Munya of disregarding parliament’s role in supporting the coffee reform agenda.
“The former minister the moment he realised that the government sponsored Coffee Bill 2021 would not sail through used its content to draft the regulations. Equally, the regulations were not submitted to Parliament as the process demands. So right from the beginning the regulations are illegal,” he said.
A caucus of MPs drawn from coffee growing regions is further pushing for the implementation of coffee reforms which the former minister declined to implement. Githunguri MP Gathoni Wamuchomba who is the chairman of the legislators’ caucus said the alliance will seek reintroduction of the Senate Coffee Bill 2020 and push it to the end.
“The Bill had good contents which if well implemented will save the industry from collapse,” she said. Her Mukurweini counterpart John Kaguchia, said current Parliament is determined to rescue the coffee industry from its current woes.
He said they will revive the Senate Coffee Bill 2020 and amend it to ensure farmers fully benefit from their hard sweat.
“Despite Kenya producing some of the best coffee in the world, farmers have continued to suffer from endless miseries leading to high levels of poverty, illiteracy and insecurity. We will work with all the stakeholders to ensure a comprehensive and receptive legislation has been achieved,” said Kagucia.
In the Executive Order No. 1 of 2023 released by President William Ruto, coffee reform agenda was domiciled in the Deputy President Rigathi Gachagua office.