Economy

Law change bid revives coffee brokers row

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Agriculture Cabinet Secretary Peter Munya. FILE PHOTO | NMG

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Summary

  • The Capital Markets (Coffee Exchange) Regulations 2020, which were gazetted in April last year, gave the authority the mandate to license the coffee exchange and brokers.
  • Kenya Coffee Producers Association chairman Peter Gikonyo said they are not concerned over who will take the control of the management of the crop as long as their members benefit from it.
  • The CMA has, so far, fully licensed five brokers to trade at the Nairobi Coffee Exchange between last year and now.

Ministry of Agriculture and the Capital Markets Authority (CMA) are staring at another round of supremacy battle that will see the latter sidelined in the management of coffee under the proposed amendments.

The ministry through the Coffee Directorate has proposed changes in the Crops (Coffee) General Regulations 2019, which pushes out CMA as the regulator of the crop by vesting the role of licensing traders and the auction to the Agriculture and Food Authority.

The Capital Markets (Coffee Exchange) Regulations 2020, which were gazetted in April last year, gave the authority the mandate to license the coffee exchange and brokers.

The amendments, which underwent public participation on Wednesday, will be presented to Agriculture Cabinet secretary Peter Munya for approval before it proceeds to the AG.

Kenya Coffee Producers Association chairman Peter Gikonyo said they are not concerned over who will take the control of the management of the crop as long as their members benefit from it.

“Whether it is CMA or Coffee Directorate that will be mandated to regulate coffee is not of concern to us. What we want is proper management that will address all the needs of the farmers,” he said.

A standoff between the AFA and farmers concerning the proposed changes saw some union members locked out of stakeholders’ meeting on Tuesday.

The union is opposed to deleting the brokers and agent terms in the proposed amendments, which will automatically strip the CMA of the licensing role of brokers and the auction.

The unions are adamant that the licensing regime should be left to counties and the CMA to ensure the process is seamless and transparent.

“We want CMA to be the one licensing brokers and the auction as it is the case now under the law,” said the union members drawn from different parts of the country.

The CMA has, so far, fully licensed five brokers to trade at the Nairobi Coffee Exchange between last year and now.

However, these brokers are yet to trade at the auction as NCE declined to admit them pointing out that it was seeking an advisory opinion from Kilimo House over the issue.

The five brokers have so far taken NCE and the Ministry of Agriculture to court with the case expected to be heard later this month.

Agriculture Cabinet secretary Peter Munya opposed the role of CMA in the coffee auction, saying it should be done by the Agriculture and Food Authority.

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