Capital Markets Authority(CMA) is in the process of taking over and fully automating all marketing and auction processes at the Nairobi Coffee Exchange(NCE). The spot market should be in place by April 2021.
While the mandate of Agriculture and Food Authority(AFA) as the regulator of the Exchange ended on 30th June 2020, this period has been extended to March 2021.
“We will set up a fully automated spot market for coffee in April next year. In the meantime, the coffee auction will still be under the supervision of AFA. We anticipate an automated trading and settlement platform to replace the current manual system,” said Wycliffe Shamiah, Acting Chief Executive at the CMA.
Although we stepped in to issue guidelines due to the gap that existed, this issue has been sorted with the Cabinet Secretary issuing a legal notice extending the mandate of AFA over the Exchange,” said Mr Shamia.
Figures indicate that Kenya sells a large bulk of its coffee or 95 per cent to overseas buyers through the Nairobi Coffee Auction. The remaining portion is sold to foreign buyers through a direct market.
The Capital Markets (Coffee Exchange) Regulations, 2020 read together with the Crops (Coffee) General Regulations,2019 envisage that the Coffee Exchange and Coffee Brokers will be licensed and supervised by CMA.