KENYA – US co-op apex NCBA Clusa has signed a memorandum of understanding with Kenya’s Ministry of Co-operatives and Micro, Small and Medium Enterprises (MSMEs) to sustainably grow the Kenyan coffee sector and enhance the country’s cooperative environment.
The agreement was signed during the US-Kenya Business Forum, signaling a commitment to strengthen various aspects of the coffee value chain in Kenya.
Earlier this year, Kenya’s Ministry of Co-operatives adopted a five-year Coffee Development and Marketing Strategy aimed at transforming the sector into the country’s top foreign exchange earner.
The strategy focuses on improving market access for growers and farmer cooperatives and increasing the resilience and adaptability of the coffee sub-sector to climate change.
The five-year agreement will see NCBA Clusa and the Ministry collaborate to enhance coffee production, processing, marketing, and export.
The partnership aims to improve the quality of coffee production and processing, maximize profits, and minimize risks for smallholder coffee farmers.
Additionally, the agreement will support farmers and their cooperatives in accessing affordable credit and establishing high-value national and international markets for Kenyan coffee.
NCBA Clusa has been working in Kenya since 1963, maintaining a continuous presence since 2001. Its projects have historically focused on enhancing democracy and governance, food security, market access, youth development, and cooperative enabling environments.
Coffee is a crucial crop in Kenya, cultivated in 33 counties by 800,000 smallholder farmers organized into approximately 500 cooperatives. The government has been implementing reforms to revitalize the sector.
The Direct Settlement System (DSS), implemented by the government last year, has enabled coffee farmers to earn over Ksh17 billion.
The DSS has streamlined coffee payments, allowing farmers to receive returns promptly and reducing their reliance on costly loans. The system ensures that payments are made on time, with the Agriculture Food Authority (AFA) pursuing any buyers who fail to pay.
Cooperatives Cabinet Secretary Simon Chelugui highlighted the system’s benefits, stating, “The main responsibility of the system is to make sure farmers and the service providers are paid on time and cushion farmers from seeking expensive loans when their payment is delayed.”
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