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Agriculture ministers from coffee-growing counties have decried the low uptake of the Sh3 billion cherry advance revolving fund established by the former government four years ago.  

Various County Executive Committee (CEC) members said farmers have been reluctantly applying for the soft loans, a situation that has contributed to low production. Kiplimo Lagat, Nandi County CEC in charge of Agriculture and Co-Operative Development argued that the fund from its inception failed to attract farmers’ attention owing to structural and fear challenges.

“There is a need for the government to rethink the concept under which the fund was established in order to make it more attractive to the farmers. Perhaps the fund is suffering from structural challenges thus scaring away farmers,” he said.

The CECs addressed the media on the sidelines of a coffee stakeholders meeting organised by the Kenya Coffee Platform (KCP) an inclusive county, national, multi-stakeholder collaborative fund at a Nairobi hotel.    

Access payments

Retired President Uhuru Kenyatta announced the establishment of the fund in early 2019. He said coffee farmers from across the country would be able to access payments from the Sh3 billion fund to help them resolve the problem of delays in coffee payment cycle.

“All coffee farmers across the country will be able to access the cherry advance at a modest interest rate of three per cent,” he said when he opened the 124th session of the International Coffee Council at the Kenyatta International Convention Centre (KICC). At the same time the government created the New Kenya Planters Co-operative Union (NKPCU) to manage the fund and appointed a seven-member board.  The government established the cherry fund to lend cash to farmers at a rate of three per cent to those affiliated to various co-operatives. The idea behind inception of the fund was to revive the sector that was once a leading foreign exchange earner but is now in decline.

According to New KPCU top management, only Sh401 million has been advanced to the farmers in the coffee growing counties since inception of the fund.

Nyeri County Agriculture executive James Wacihi said the acceptance of the fund on the ground has been very low and no clear answers are given as to why farmers are not willing to apply.

“In Nyeri County very few coffee co-operative societies have applied. Equally we have received complaints from the fund trustee of the low uptake. Lack of credit has been a major challenge to the majority of coffee farmers thus leading to low production,” he said.  Wacihi added that fluctuation of coffee prices has affected the production of coffee in the country.

“As counties that depend heavily on coffee we are working together with the national government and other stakeholders to ensure the once foreign exchange earner has been restored,” he added.

Marketing agents

Lagat called on the national novernment to help in restructuring Nairobi Coffee Exchange (NCE) with a view to shielding it from manipulation by marketing agents. 

Karugu Macharia, KCP chairman said deepening of reforms in the industry is critical and more so to ensure high production has been realised. “In the current period coffee production increased to slightly over 50,000 tonnes compared to below 40,000 tonnes in 2021. Working together as stakeholders can help in increasing the production to more than 100,000 tonnes annually,” he said.