Positive Environment News

FEATURE - Kenyan Coffee Farmers Struggle Despite High Prices

Date: 03-Mar-06
Country: KENYA
Author: David Mageria

The 73-year-old bought the stones in 2002, hoping a recovery in the coffee sector and rising prices would give him the money to build a new home and move from his crumbling mud house.

But the foundations have not even been laid yet because Munene and other farmers have not benefited as they hoped from higher prices. And now a drought is threatening more hardship.

World coffee prices, especially for Arabica coffee which Kenya produces, have risen sharply in the last two years on fears of reduced supply from top producers.

But for Munene and other farmers in Kenya's coffee-growing heartland on the slopes of Mount Kenya, dreams of beautiful homes, better schools for their children and generally higher living standards have remained just that.

Analysts say farmers' earnings are swallowed up by the repayment of huge loans taken out to buy machinery or vehicles for coffee factories, often at inflated prices.

Farmers also grapple with high fees charged by middlemen who move the coffee from the cooperative societies to auction. Many farms are also very small, making it difficult to increase yields and cut costs through economies of scale.

Some farmers are diversifying into higher-paying crops like macadamia nuts and even vanilla to boost their incomes.

"Our problem is that we are not paid well," Munene told Reuters, as he sprayed his green coffee leaves to protect them from coffee berry disease.

Most coffee bushes on neighbouring farms had sickly yellow leaves due to a severe drought that aid agencies say threatens 11 million people with starvation across east Africa.

The Coffee Board of Kenya predicts the drought, which has killed dozens of people and animals, could slash the domestic harvest in 2005/06 (Oct-Sept) by between 15-20 percent from an earlier estimate of 65,000 tonnes.

DROUGHT DANGER

Farmers in central Kenya, where 80 percent of the nation's crop is grown, say they fear crop failure if the rains during the March-May wet season fail.

The coffee bushes are vulnerable because many farmers cannot afford to buy expensive fertilisers, pesticides, herbicides and insecticides to develop their crops.

In the last days of February, heavy rains fell on the area, raising hopes that the crop could recover if rains continued.

Kenya is known for its high quality Arabica beans grown mainly near Mount Kenya and used by roasters to blend with coffees from other origins.

But the country's coffee production has been falling from a peak of 130,000 tonnes in 1987/88 to an estimated 50,000 tonnes as poor prices and mismanagement have forced farmers to neglect their coffee trees or turn to other crops.

"The government can help us by getting a good market, a good price for our coffee," Munene said.

Ironically, Munene's coffee factory paid the highest price to farmers around Nyeri during the Oct-Sept 2004/05 season.

The Gatomboya Coffee Factory paid each farmer 39.25 Kenya shillings ($0.54) per kg, compared with an average of about 20-25 shillings per kg paid by other societies.

But it's still a far cry from the good old days of 1997/98 season, when Munene received 83.50 shillings per kg.

Many Kenyan coffee farmers had enthusiastically returned to their coffee bushes after the new government of President Mwai Kibaki took office in 2002, promising bold agriculture reforms.

But critics say the reforms have been too slow.

Farmers have been calling on the government to waive their huge debts, help lower fertiliser prices, and enable them to access cheaper credit through a coffee fund.

Many find themselves borrowing against the prices their crops will pay, getting deeper and deeper into debt to banks who charge stiff interest rates.

"SECOND WINDOW"

Many farmers are now pinning their hopes on the so-called "second window" which will allow them to bypass a central coffee auction and negotiate higher prices directly with

Reuters
© Thomson Reuters 2006 All rights reserved

  • Recycling Week
  • Business Recycling
  • recycling Near You
  • Make It Wood
  • Tree Day
  • Cartridges for Planet Ark