Scandal: Africa’s biggest coffee mill disappears

Africa’s largest coffee mill has been stolen from the Nairobi premises of the Kenya Planters Cooperative Union.

The mill, which occupied five floors and was insured for Sh805 million, is believed to have been cut up by vandals and sold off as scrap metal.

Even handrails have been removed from staircases in a metaphor of the wanton greed and thievery in the coffee sector.

“The mill was stolen and the matter has been reported to the police,” says KPCU Chairman William Gatei.

The multimillion-shilling mill, which the farmers' body wanted to keep as an artefact, was stolen when KPCU was under a receiver manager.

KPCU was thrown into receivership in 2009 over a Sh700 million debt owed to Kenya Commercial Bank.

Its operations were handed over to Deloitte & Touche, under whose watch it is believed the mill was “stolen”.

“We are still pursuing the matter with the insurance agency, but we have lost a mill that was central to the story of coffee in this country,” says Mr Gatei.

When it operated, the mill had an installed capacity of 130,000 tonnes.

The eight mills currently operating in Kenya have a collective installed capacity of 230,000 tonnes — an indicator of the massive infrastructure that was stolen.

“The people who stole this mill did not want KPCU to ever come back into the market. They wanted to forever control the coffee market by crippling us,” said Mr Gatei as he took the Daily Nation on a walk on the gaping floors where the mill once stood.

The lift no longer works and the weighbridge at the entrance has not been used for years.

“We have repaired the weighbridge, but we have no customers,” he said.

AN ENIGMA
The stairs are dimly lit and the air is thick with dust and the smell of mildew.

Some shafts of light burst through gaps in the windows to illuminate broken pipes.

There are dark holes where floorboards have snapped. One false step could send you tumbling down four floors.

The place is as broken down and treacherous as the coffee industry itself.

“Some of the wooden floor boards are rotten. Don’t step on anything wooden,” Mr Gatei had warned in advance.

On the upper floor, a guide struggles to open a rusty padlock. He succeeds, and the door creaks open.

On the left is an archaic Busbar Chamber System — a 1950s power distribution system that once powered the mill and the elevators.

KPCU Plaza and its mills once formed Nairobi’s coffee district and was one of the largest investments of coffee farmers in the country’s history since colonial times.

Today, nobody seems to know how a mill weighing hundreds of tonnes could just disappear. On the first floor are scrap metal and iron plates, which give an unpleasant metallic essence.

“This is all that remains of the massive mill,” said Mr Gatei.

Beneath the dust and debris are farmers’ documents, files, coffee beans, and rats.

Each office has its share of dust. An old thermos sits on one table covered by a thick layer of fine dust.

The spindles of the stair banisters are also gone, and one has to walk carefully down the stairs.

“The idea was to cart away anything metallic,” says Mr Gatei.

INCREASING PRODUCTION
The market for recycled steel has been booming since one can create virgin steel from iron ore and coke, and the other is to melt down used steel and recycle it.

Recycled steel is just as strong as virgin steel.

In one office, whose table is covered with its share of dust, sits an old 66 Imperial typewriter.

We open the drawers to reveal coffee receipt cards and daily report cards.

KPCU has new modern mills in the countryside and in Nairobi.

The Dandora mill, which now includes a roastery, has started packaging coffee for the local and international market.

They have leased the Meru plant to the Meru Union while the Bungoma plant is operating.

KPCU is in court to get back the Sagana mill, which was leased to Kenya Coffee Co-operative Exporters by the receivers.

“We have been out of receivership for one year and we want to turn around this organisation,” said Mr Gatei.

But their attempt to lure back farmers into their mills by paying them cash upon delivery of coffee is meeting resistance from the regulatory body, the Agriculture, Fisheries, and Food Authority.

“We have been given a cease notice and told that it is illegal to pay farmers cash. We have told them there is no law stopping us from doing that,” said Mr Gatei, displaying a copy of the Affa order.

He said that the KPCU receivership was illegal since the Coffee Board by then owed KPCU $2 million worth of coffee deliveries.

“Farmers, who also owed us Sh4.6 billion, went elsewhere and (the) Coffee Board did not help us to recover our money,” said Mr Gatei.

KPCU has now signed an agreement with an Israeli firm, Green Arava, to take over farm management of small-holders and help them make a living.

“We shall contract those coffee trees and introduce fertigation in those farms to get better returns,” he said.

Fertigation is the injection of fertilisers, and other water-soluble products into an irrigation system.

The idea is to increase coffee production and coffee earnings from the current $300 million a year to $3 billion.