A farmer tends to her coffee plants. FILE PHOTO | NATION MEDIA GROUP
A discussion on coffee growing in Kenya is useful to understand the problems of small scale farmers. Coffee is not grown here near Lumakanda, but it used to be grown in Gladys’ home area near Chavakali and it is still grown on the slopes of Mt. Elgon which we can see from our kitchen window.
Let me start with an anecdote. Around 2004 I was in Burundi and bought a one-half kilogram (1.1 pounds) of coffee for the equivalent of $1.50. This coffee was grown, roasted, ground, and packaged in Burundi. This was a present for my late aunt, Eleanor O’Kelly. When I gave it to her, she wanted to pay me $9.00 for it since this was the price of equivalent coffee in the US. In other words the coffee was six times the price in the US, meaning that the middlemen, importers, US coffee companies and others were making 84% of the money, leaving the Africans with a small fraction of it.
Today 70% to 75% of the coffee produced in Kenya is grown by about 700,000 small scale farmers, while the rest is grown on large estates. These farmers have an average area of one-half acre under coffee. One of the major reasons that these farmers like to grow coffee is that the return from a small plot is much higher than could be obtained from any other crop. Note that Kenyans do not drink much coffee so that 93% of the coffee grown is exported into the international market.
At one time coffee was Kenyan’s largest foreign exchange earner. Production peaked in 1989 at 130,000 tomes. It is now dropped to around 40,000 tons. As a foreign-exchange earner coffee is now behind tea, horticulture, tourism, and remittances from abroad.
Why this decline? It can be traced to external and internal causes.
External causes: One of the major problems with coffee is that while world consumption is fairly static, growing at only about 1% per year, production can vary significantly, often due to frost in Brazil’s coffee growing region. In such cases the price of coffee beans increases and the farmers receive a decent return. But in other years of high coffee production the price decreases and the return to the small farmer barely makes the growing of coffee worthwhile. These fluctuations are discouraging to the farmer. Coffee takes two years after planting to begin producing and maximum production is two or three years after that. The grower is therefore dependent on the vicissitudes of the world market. When the price collapses, some farmers neglect their coffee or even uproot it.
Yet another problem is that the international community including the World Bank and International Monetary Fund pushes every coffee growing country to increase its production to earn more foreign exchange. This leads to overproduction of coffee and a decrease in price. In order to earn more foreign exchange, the Kenyan government is again encouraging farmers to plant more coffee.
Another issue is that the government can and does tax coffee exports, taking some of what could have been given to the farmer to support the government itself. It is impossible for the government to tax the maize, beans, and collard greens like we grow in our farm so it is in the interest of the government to promote export crops at the expense of local food production.
Internal reasons: All these small scale coffee farmers were organized into coffee cooperatives. At the time of independence these were strong institutions giving benefits to their members. But over the years mismanagement, nepotism, and corruption entered into the coffee societies. Many of them collapsed. Even those that continued often did pay for the coffee beans delivered for a year or more. As a result farmers were forced by the need for funds to sell their berries to middlemen at poor prices. Recently in the news there have been reports of robbers breaking into coffee warehouses and stealing the berries, resulting in further losses for the cooperative societies and their growers.
As a result of both these external and internal causes, many small scale coffee farmers have uprooted their coffee for more lucrative crops or, in some cases, particularly north of Nairobi, housing developments.
The government has been trying to support more coffee farming. For example, in Bungoma County next to us, the county government is giving away free coffee seedlings to farmers. Without broad improvements to the whole system, I am not sure if this will be effective.
There are some possibilities. For example, Java House, “Africa’s favorite Coffee-led Restaurant”, as it advertizes itself, is a Kenyan based coffee company similar to Starbucks in the US. It has 51 outlets targeting the high end market and sales last year of 4 billion shillings ($40 million). It uses local Kenyan beans which it roasts in its stores. Will this lead to higher coffee consumption in Kenya and a steadier market for it coffee beans?
One major issue is that the big coffee companies control the coffee trade. Most agricultural products from East Africa are sold without processing while the exporters control the processing process, thereby reap the added value. There are attempts by African countries to add value to their coffee by processing it before selling it internationally. Rwanda Farmers Coffee Company owned by the six coffee cooperative societies in Rwanda has set up its own roasting and packaging line called Gorilla Coffee to export processed/packaged coffee. This year it has just sent 10 tons of Gorilla Coffee to the United States. Note from the picture that this coffee is labeled as “beyond fair trade”.
While this is the story of coffee in Kenya, similar stories can be told about pyrethrum (a natural insecticide), macadamia and cashew nuts, mangoes, passion fruits, and many other crops. If all of these were properly organized, Kenyan small scale farmers would be much more prosperous.
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