Most coffee farmers still opt for private warehouses despite the ample warehousing capacity of 946,045 square feet offered by the government through New KPCU.
- According to parliament the Parliamentary Departmental Committee on Trade, Industry and Cooperatives, New KPCU requires KSh2.7 billion to modernize warehouse across the country, thereby restoring confidence in farmers who fear missing out on international market due to low standards by the non-modern warehouses.
- New KPCU has 13 warehouses in Dandora, five in Sagana and 6 others in Meru.
- Out of the facilities, only three warehouses are modernized in Dandora, two in Sagana, with all the warehouses in Meru having been modernized.
The 13 Dandora warehouses have a storage capacity of 686,000 square feet, which is an increase from 258,062 square feet before the modernization of its 3 warehouses. The branch has a mill which serves farmers from Kiambu and lower eastern including Tala, Makueni and Machakos, Kitale, Bungoma, Kisii, Nyanza and Rift Valley.
The current coffee production capacity is 1,178 tonnes and it is projected to increase to 7,683 tonnes by Financial Year 2026/27. To improve its production capacity, New KPCU says there is a need to increase processing capacity of Dandora’s milling plants from the current 4 tonnes per hour to 8 hours.
The Sagana warehouses have a storage capacity of 125,014 square feet, which is an increase from 76,006 square feet before modernization of its two warehouses.
The modernization process involves removing the asbestos roofing which is harzardous, painting, floor works and construction of boundary walls to improve security. “Following our inspection, we noted that, there is a pressing need to modernize the warehouses, especially, the removal of asbestos, which is associated with health risks exposure,” noted the James Mwangi Gakuya led Committee.
In its recommendation, the committee says new KPCU once it receives budgetary allocation for modernization of its warehouses, should review mode of implementation of the process, such that it prioritises completion of one warehouse at a time.
“This approach is proposed in view of the fact that, New KPCU attempted to modernize multiple warehouses simultaneously, resulting in slow progress towards completion. By prioritizing one warehouse at a time, the agency can streamline the modernization process to achieve more results,” the Committee said.
Recently, the government announced the coffee reforms which among others, seek to minimize the influence of the multinational companies involved in buying coffee from farmers and selling in international markets, thus acting as middlemen.
The reforms seek to create competition, consequently leading to New KPCU’s involvement in buying coffee from farmers and selling the commodity directly with the aim of putting more money into the farmers’ pocket.
The committee also noted that, the allocation of KSh4 billion for the coffee cherry fund to upscale the payment to coffee farmers, is yet to be fully disbursed.
Delays in exchequer releases pose a challenge to New KPCU, since coffee farmers are anticipating an increase in payment from KSh40 per kg of cherry to KSh80 per kg. The committee observed that only KSh5000 million has been disbursed.
See Also:
State Writes-Off KSh 6.8Bn Debt in Coffee Reforms Agenda
