Advise coffee growers
Posted Tuesday, July 31 2012 at 20:11
There is notable vibrancy in the coffee sector buoyed up by both good global prices and a favourable climate.
The government has also played a key role by writing off more than Sh8.2 billion owed by coffee farmers in the past 10 years.
Most of the money was borrowed in the late 1980s when coffee prices were good, but the loans could no longer be serviced after the prices tumbled 10 years later.
A similar trend has started, which calls for policy interventions to help secure coffee farming from the behaviour of exploiters who are merely interested in making profits.
After selling coffee mills to private investors and getting good returns, manufacturers are now trying to sell to coffee societies the idea that they will get even better prices if they process their own coffee. The effect is a rush by coffee societies to purchase their own milling plants.
At least 16 coffee societies are said to be in the process of setting up their own plants estimated as being worth Sh100 million.
The fear is that the move will saddle the industry with new debt, especially if the global coffee prices fall below what they are now.