Among those riding the wave of optimism in the wake of the opposition’s overwhelming and unprecedented election victory in Kenya last month is the east African country’s beleaguered coffee sector, which gives work to half-a-million farmers.
Better weather and growing global demand for Kenyan beans have bolstered hopes for a recovery. The new government, led by President Mwai Kibaki, is making all the right noises, pledging an all-out war against corruption, to fill key jobs across the country according to merit rather than political connections, and to revitalise a generally dilapidated and uncompetitive agricultural sector.
”The government is determined to reverse a slump in production from last year’s 48 000 tons to the average of 130 000 tons seen in the 1980s,” said a government official.
Up to 1986 coffee was Kenya’s leading foreign currency earner, contributing more than 25% of government revenue.
The coffee market has since been relegated to fourth position, behind tea, horticulture and tourism, according Michael Otieno of state-run Coffee Board of Kenya (CBK).
The trouble started in 1989 when the International Coffee Organisation (ICO), the world body controlling the coffee trade, scrapped a quota system.
”Brazil, Vietman and other countries went wild, flooding the market with fairly lower quality coffee… then prices fell,” Otieno said.
He said poor management, high production costs, lack of access to credit facilities to farmers and poor technology were other factors that adversely affected the sector.
Kenya now produces about a million of the world’s annual 110-million bags of coffee. According to agriculture minister Kipruto arap Kirwa, 70% of small-scale coffee farmers have suffered.
Farmers’ incomes are erratic because coffee is marketed through the Central Auction System (CSO), a weekly sale where prices fluctuate from between one to $1,5 per kilogramme. The cost of a 100-kilogramme coffee bag fell steadly from 25 150 shillings ($322,4) in 1997 to 11,776 shillings ($150,9) in 2001/2, according to government figures corroborated by the CBK.
”Such fluctuations affect their contributions to unions, which are thus rendered weak,” Shadrack Kerera, the managing director of Kenya Coffee Growers Association (CGA) told AFP.
A recent report by the British charity, Oxfam, titled ”Mugged: Poverty in Your Coffee Cup”, accused large coffee companies of controlling the market at the expense of some 25-million poor farmers across the world.
”The coffee market is failing. It is failing producers on small family farms for whom coffee used to make money,” the report said. The report added that 1997’s price slump was largely caused by globalisation rather than traditional supply and demand economics.
The report singled out Swiss multinational Nestle and US mega-chain Starbucks as beneficiaries of a system that has pushed farmers in the developing world into abject poverty as ”coffee companies were laughing their way to the bank.”
”Asking some of the world’s poorest and most powerless people to negotiate in an open market with some of the richest and most powerful results in the rich getting richer and the poorer getting poorer,” the report warned.
Although Kenya recently bowed to international pressure to liberalise the previously government-controlled sector, the Coffee Act of 2001 failed to dislodge the lion’s share of its riches from a few well-connected big players.
Kirwa said the new government was determined to improve the lot of Kenyan farmers, not least by repairing roads ruined by bad weather in 1998, when tons of beans rotted because access to markets had been cut off.
”Backed by favourable weather and the respectable quality of our coffee, the government will assist coffee farmers by getting loans for farm inputs,” Kirwa said.
Political appointments to key jobs in the sector, made by the ousted government of former president Daniel arap Moi, led to millions of dollars being looted, according to the head of the CGA. ”Losses that ensued vexed farmers who started destroying coffee bushes, replacing them with horticulture,” Kerera explained.
Under pressure from Oxfam and other groups, in October last year the ICO directed roasters to deal only with coffee that has passed its quality tests and that offered ”decent” prices to produce, according to an official at the CBK, who asked not be named.
”Kenya stands to benefit because of its high quality share,” government coffee tester Joseph Njogu said, adding that ”farmers should now focus on improving quality.” – Sapa-AFP