KENYA – For the third week in a row, the operations of the weekly Nairobi Coffee Exchange (NCE) remain suspended, presenting confusion on trading permits to farmers and traders.
Industry players blamed the suspended auctions on the confusion caused by a government decision to suspend coffee brokerage and marketing licenses pending reforms in coffee sales.
There has been no trading at the auction since July 6, 2023, when the current marketing season resumed—meaning that farmers are stuck pilling stocks of coffee they can’t sell.
“The auction resumed from recess on July 6 but there hasn’t been any trading for three weeks now. There was no trading on July 6, July 13 and even today July 20 all is silent” a source linked to the auction told Daily Nation.
“The government had promised to extend existing marketing and brokerage permits by three months up to September through a gazette notice but that hasn’t happened. This means no trading can take place at the auction because all permits are affected.”
Agriculture and Livestock Development Cabinet Secretary Mithika Linturi claimed that his ministry has noted potential conflicts of interest by some players in the coffee trading chain which required to be addressed.
“The Ministry has taken note of many players participating in the coffee trade along the coffee value chain, the different roles that they play from farm to cup, and the challenges that coffee farmers face as a result of probable existing conflicts of interest amongst the various categories of value chain players,” he said in a notice through the Agriculture and Food Authority.
In the notice, he added that while it is noted that millers are licensed by the county government, brokers by the Capital Markets Authority, and buyers by the Agriculture and Food Authority’s Coffee Directorate, it is regrettably noted that provisions of the Crops (Coffee)(General) Regulations, 2019 have not been adhered to in some cases by licensing authorities.
All licenses issued by different authorities run for a period of 12 months starting July 1 to June 30 of the succeeding year.
Therefore, the Ministry directed that all existing licenses held by various coffee value chain players should be renewed as part of efforts to streamline the licensing process to provisions of the Regulations.
Kenya’s coffee is much sought after by roasters and blenders and the country sells its coffee to the world market. The international prices are used as a benchmark for the local price at the NCE.
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