The Task Force on Coffee has proposed the establishment of the Nairobi Coffee Exchange in a bid to revive the sub-sector.
The new body will have control over finances and formulation of policies to govern trading in the product.
The Exchange, which will be headquartered in Nairobi, will have powers to establish the auction system under which coffee is offered for sale and provide a platform for the trading of coffee.
It will also establish, promote, develop, support and carry on the business of coffee exchange.
Details of this push to revive the coffee sub-sector are contained in the Coffee (General) Regulations, 2018, presented to the Senate Committee on Agriculture by the Coffee Sector Implementation Committee, which was established to explore ways of reviving coffee production.
According to the report, the Exchange will ensure an efficient and expedited settlement and payment process of coffee proceeds to growers and their service providers.
President Uhuru Kenyatta established the committee to investigate the problems in the sector and also align the sub-sector’s regulations with the constitution, the Crops Act and provide for the functions of the county government and protection of the growers rights along the value chain.
The Commissioner of Cooperatives Mary Mungai told the Senate Committee on Agriculture on Thursday that the decision to establish the Exchange had been arrived after it emerged that the traditional coffee auction lacks transparency.
“We have established a direct settlement system. Money will be paid to the growers account directly from the bank. Now it goes through commercial marketing agencies, but it had proved to be an inefficient system,” she Ms Mungai.
She said the committee had benchmarked with the tea industry where the growers receive payment from the auction.
The regulations have abolished the system of marketing agencies, which has been abused in the past.
The regulations gives farmers the power to sale clean coffee on mutually accepted terms and conditions enforceable in law.