Kenya plans to mobilise investment to revive of the coffee industry that has in recent years experienced a steep slump and ceded its share of the international market to competitors.

Cabinet Secretary for Cooperatives and Micro, Small and Medium Enterprises (MSME) Development Wycliffe Oparanya, in an interview on the side-lines of a cooperative leaders meeting in Naivasha, said the intention of the Kenya Kwanza government is to ensure coffee industry regains its position in the economy as leading foreign exchange earner.

In the past, the Kenyan coffee industry was a significant foreign exchange earner and played a crucial role in the country’s economy.

Since coffee farming was introduction in Kenya in the 1890s, its production grew so fast to become a major cash crop, and hit the peak in the 1970s and 1980s. However, the industry faced challenges, including market volatility, policy changes and environmental issues, leading to a steep decline in production and a shift in its importance over the years.

“The president has committed himself to making sure that the current production of 50,000 metric tonnes increases to more than 150,000 metric tonnes by 2028-2029, which is very critical. Achieving this level of production will help in wealth creation and poverty reduction,” Oparanya said.

Following implementation of reforms initiated a decade ago together with value chain players, the cabinet secretary said the country has realised high returns, especially from coffee price increase.

Currently, Oparanya explained that for some years prices have gone up three times, although production is still low. Farmers, he added, who have consistently invested in coffee are smiling all the way to the banks as current dynamics in the global market have led to an increase in prices.

He noted that, due to demographic and consumer lifestyles changes, key segments of the global market have added coffee to the list of beverages taken often.

“China, which has not been consuming coffee, has added coffee to her favourite beverage list, thus offering a huge market potential for the commodity,” the CS said. He recalled that at independence, the country topped Africa in coffee production and equally controlled a sizeable share of global market.

But owing to various dynamics, including the effects of World Bank and International Monetary Fund-prescribed structural adjustment programmes in the late 1980s and early 1990s, the local industry has decreased sharply from high production of 129,000 metric tonnes to between 40,000 and 50,000 metric tonnes.

Kenya, the CS noted, is currently controlling less than one per cent of the global market and, in Africa, is now in position five after Ethiopia, Uganda, Côte d’Ivoire and Tanzania.

The sector, once revived, Oparanya hopes, will support government in tackling current grinding poverty, low development and the lack of interest by the youth in agriculture.

“The government has developed strategies to make sure the industry is revived. Topping the list of strategies is the revival of collapsed old coffee cooperative societies, mainly unions,” he said.

He also plans to revive institutions currently struggling to survive. The government, the CS confirmed, has already made available resources to the ministry to make sure this programme is implemented.

On April 17, 2025, the government introduced the direct settlement system (DSS) payment system for coffee farmers to streamline payments and enhance transparency.

The DSS ensures proceeds from coffee sales are directly deposited into farmers’ bank accounts, eliminating delays and potential mismanagement caused by middlemen and brokers.

Two weeks ago, Francis Ngone, chairman of the National Coffee Cooperative Union (NACCU) dispatched a memorandum to the cabinet secretary asking for a one-year extension to June 2026, to delay implementation of directive requiring direct payments to farmers’ bank accounts.

He argued that the extension would enable cooperatives to complete data clean-up, facilitate the opening of bank and SACCO accounts for all farmers and enhance financial literacy.

Ngone said there was a need to review the current levy structure to ensure that it does not erode farmers’ income and that proceeds are transparently managed to support extension services.

• A Tell Media / KNA report / By Wangari Ndirangu