Fresh row brews as auction bars CMA licensed millers

The Nairobi Coffee Exchange has declined a request by five millers who were recently licensed by the Capital Markets Authority (CMA) to trade under the new coffee regulations, saying the auction needs clarification from the Ministry of Agriculture on the matter.

The millers had requested for lots range and brokers codes, which are a prerequisite before one is allowed to trade coffee at the auction.

NCE chief executive officer Daniel Mbithi, in a letter dated August 19 seen by the Business Daily, said they are seeking advisory from the ministry on how to proceed with the millers who have been licensed by CMA.

“Pursuant to the Legal Notice No.104 … by Cabinet Secretary Agriculture extending the validity of all marketing licenses until June 30, 2022, we are taking advisory from the ministry on how to proceed with brokers licensed under the CMA to ensure smooth transition,” said Mr Mbithi.

The NCE has said it will revert to millers on the way forward once they get the advisory from the ministry, whose supremacy battle with the CMA over the management of the auction now risks leaving traders in limbo.

On July 1, the CMA granted Meru County Coffee Marketing Agency Ltd a full coffee broker licence, while Kipkelion Brokerage Company Ltd, Murang’a County Coffee Dealers Company, Mt Elgon Coffee Marketing Agency Ltd and United Eastern Kenya Coffee Marketing Company Ltd were issued with conditional licenses.

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 CMA had given coffee traders up to July 1 to comply with the new regulations but pushed the deadline by a further three months, arguing that the move was meant to give traders who have not complied more time to do so.

However, Agriculture Cabinet Secretary Peter Munya has opposed the role of CMA in regulating the coffee auction, saying this is the preserve of the Agriculture and Food Authority.

He therefore responded to the CMA move by extending the old laws by a year.