CS Chelugui lauds media’s role in the Coffee Sub Sector Reforms

Co-operatives Cabinet Secretary Simon Chelugui has lauded the role of Media in the ongoing Coffee Sub-Sector Reforms.

Speaking on Monday during Media Engagement on the same, the CS reiterated that Media has key role on knowledge sharing.

“As a government, we appreciate and acknowledge the crucial and indispensable role the media plays in information sharing with the public,” he stated.

The CS also expressed sincere appreciation to President William Ruto and Deputy President Rigathi Gachagua for exemplary leadership and unwavering commitment to the reforms agenda.

He noted that the coffee Sub-Sector is a key pillar of the Bottom Up Economic Transformation Agenda (BETA), Agricultural Transformation pillar, by virtue of its contribution to the overall Gross Domestic Product (GDP).

“The government has over the years taken cognizance of the strategic role Coffee plays towards poverty alleviation, economic empowerment, foreign exchange earnings, food security and job creation thus putting various interventions to support the Sub-Sector,” 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 which declined to as low as 36,000 metric tonnes in 2019/20.

In the sessional Paper No. 1 of 1986, Kenya had projected a production of 350,000 tonnes by the year 2000 going by the advancement in development of better farming technologies and varieties, favourable coffee market and prices paid to farmers.

This is proof of the immense opportunities that abound within the sector. However, the government continues to confront a myriad of unprecedented challenges in implementation of the coffee reforms.

According to the CS, there has been notable and tangible progress with enhanced productivity, improved market access and stringent quality control measures.

And, the results are already evident, with increased yields and earnings, improved auction participation, enhanced traceability and origin farmer linkages.

Some of the achievements and successes so far include:

(I) Review of existing Licenses: Milling, Brokerage/Marketing agent, Exporter, and Warehouse manager.
This initiative allows different entities to specialize in specific functions, thereby ensuring checks and balances across the value chain and curtails monopolistic tendencies and self-interest.

(ii) Increased Coffee Sales at the Nairobi Coffee Exchange (NCE).

The Nairobi Coffee Exchange was reopened by His Excellency the Deputy President, Hon. Rigathi Gachagua on August 15, 2023. Since that pivotal moment, the NCE has successfully conducted 31 sales, during which a substantial number of bags of coffee have been traded.

The quantities of coffee sold at the auction represents about 74% (2021/22) of the total average national production, demonstrating the vibrant activity and renewed confidence in the coffee exchange.

(iii) Improved Payment Model (Direct Settlement System—DSS) which 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.
The platform allows farmers the ability to open individual accounts where net payments will be credited within 48 hours of sake; while settlement of cash after 5 days from the prompt date may attract imposition of regulatory sanctions and penalties. This innovation is also a significant step towards enhancing accountability and streamlining governance within cooperative societies.

(iv) Coffee Cherry Advance Revolving Fund (CCARF)

In an effort to promote financial inclusion, a self-sustaining sector and enhance production, the Government initiated the Cherry Advance kitty, managed by the New Kenya Planters Cooperative Union (New KPCU). Coffee Cherry Advance Fund total allocation to date is Kshs. 6.7 billion. With the increased funding, farmers will now take home Kshs.80 per kilogram of cherry at the factory gate from the previous Kshs.20 per kilogram of cherry.

This financial support has alleviated the cash flow challenges faced by farmers, enabling them to reinvest in their farm inputs and improve productivity. Timely payments are crucial for the sustainability of coffee farming and cushioning farmers from poor markets.

Other successes include: International Market Linkages and Coffee Promotion and Legislative and Policy Interventions.

“Our journey to restore the Coffee Sub-Sector cannot be complete without the media and in cognisant of crucial role the media plays in dissemination of information, today I had a robust engagement with reporters from various media houses in Nairobi,” he stated.

The meeting was also attended by Principal Secretary for the State Department of Cooperatives Patrick Kilemi, Chief of Staff, Office of the Deputy President, Ms Wanjiku Wakogi, CBS, New KPCU PLC Chairman Daniel Kiprotich Chemno and Managing Director Timothy Mirugi, Cooperative Alliance of Kenya Chief Executive Officer Daniel Marube as well as representatives from Coffee Research Institute (CRI).


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