Anxiety as CS Mithika Linturi blocks four companies’ direct coffee sale deal
Agriculture Cabinet Secretary Mithika Linturi in Eldoret town, Uasin Gishu County on August 31, 2023.
A fresh row is brewing in the coffee sector after Agriculture Cabinet Secretary Mithika Linturi suspended plans by the Agriculture and Food Authority (AFA) to issue direct sales permits to four companies.
In a letter to AFA acting director-general, Willis Audi the CS directed that the planned licensing of Sustainable Management Services, Kenya Co-operative Coffee Exporters Limited, Iceberg Movers Enterprises Limited, and Coffee Management Services as direct-sales agents be suspended until ongoing coffee reforms are finalised.
“Information has been brought to my attention on the recommendation to license the following companies as coffee direct sales agents,” Mr Linturi said.
“The purpose of this letter is to direct that you suspend this exercise until the ongoing coffee sector reforms are finalized or until otherwise advised by my office,” he added.
The letter dated November 16, 2023, is copied to chairperson of the coffee reforms steering committee which is domiciled in the Office of the Deputy President Rigathi Gachagua.
Kenya coffee is marketed either through the weekly Nairobi Coffee Exchange or sold directly to buyers abroad.
Insiders who spoke to Nation said the decision by the CS is likely to trigger a fresh storm in sale of the beans, which is grappling with disruptions due to hasty reform measures by the State.
“What the State is doing is defeatist in many ways and it doesn’t seem to learn from the mistakes that have messed up the industry for many months now. Reforms should be objective and not fashioned to punish individuals over imaginary reasons,” an official of a coffee firm said requesting anonymity.
“In a liberal market buyers and sellers have freedom to trade with whoever they want and trying to frustrate that through subjective measures would backfire on the industry which has already lost ground through unnecessary feuds,” said the official.
Mr Linturi’s action comes after senators accused the AFA of allegedly frustrating ongoing reforms in the coffee sub-sector by approving permits for the four companies. Kirinyaga Senator James Murango accused the regulator of exploiting loopholes existing in the Crops Act, 2013 to introduce middlemen through planned approval of the four coffee firms to act as agents to facilitate direct sales of the cash crop.
“AFA should be disbanded because it has now become a grouping of cartels. They have become roadblocks in all reforms in the agricultural sector and that is why everyone is running away from them,” he claimed.
Mr Murango said they will push, through the Coffee Bill 2023, to ensure that the role of licensing such agents is taken over by the Coffee Board of Kenya, accusing AFA of misusing its licensing powers.
Senator Murango said despite the authority being the umbrella regulatory body of former regulatory institutions in the agricultural sector; it has become a roadblock to reforms in the sector because of the “rogue nature of its operations”.
