The case for a commodities exchange to lock out rogue traders and cartels


At first, Boniface Njogu Wainaina, 73, had hoped that his children would continue seeking economic solace in coffee farming. But he now knows the truth — they won’t.

After 57 years of growing coffee, Mr Wainaina is about to abandon his dreams of ever eking out a living from the world’s most sought after commodity, after oil.

He also represents the first — and perhaps last — generation of coffee growers, unless the government intervenes to streamline the sector.

Coffee growing dates back to colonial times, and Mr Wainaina was one of the first indigenous farmers who jumped at the opportunity to grow the crop in 1958, after the colonial government opened a small window for local farmers to grow what was an exclusive cash crop for white settlers.

But unlike the settlers — who owned large coffee estates — the story of small-holder farmers has not been as sweet.

“Back then, the colonial government only allowed us to grow no more than 100 trees. I remember we used to dig the holes 3 metres by 3 metres, put 10 kilos of manure and then plant. We were paid very little money. But the coffee business was lucrative!” he recalls.

Although he still grows coffee on his four-acre piece of land in Kabati, Murang’a, age is fast catching up with Mr Wainaina.

Like many small-holder farmers, he doesn’t know what happened to the promise of better returns.

“A few years after I started growing coffee, Kenya gained independence and President Jomo Kenyatta told us we could grow as much coffee as we wanted. We were no longer confined to the 100 trees rule. That helped us because we were finally able to do great things for ourselves using returns from coffee. Coffee was currency in itself such that if you had no money to pay school fees and you had coffee in your farm, the children would never be sent home.”


Those are now dreams — stories of days long gone. As he tells the story, he dons a smile — one that doesn’t reach his eyes.

Then as suddenly as the smile crosses his face, it disappears.

“Things started going bad when President Moi took over power. Coffee began to lose its glory. The economy weakened and money had no value anymore. I couldn’t afford my children’s school fees anymore. In the 1976/77 cycle, coffee did very well and there was a boom. I was paid shillings 3.30 per kilo, which is not a lot of money, but the currency had value. That was when I built this house.”

Mr Wainaina points to his left, where a stone house sits.

It has eight rooms in total, he tells me. He turns his eyes towards me again and motions me to follow him.

We go round the house to the coffee farm and a narrow path running through it with coffee bushes on each side.


But it is not just coffee I see. There are hundreds of banana trees and other crops among the coffee bushes. It recently rained and the air smells of wet soil.

“These days money is nothing. It has no value at all. Look at my coffee. I took half and split it between my two sons. But when they tended the crop for one year, they said it was a waste of time because there was no money in it. They abandoned it so this year they harvested nothing.”

“Look, even the trees are dying,” he says.

There is fruit in the trees he’s showing me. But they have overstayed in the field and are now withered and falling off the branches. Mr Wainaina drifts off to another part of the field and I quickly follow.

“This is my field. I recently harvested the coffee and do you know how much I was paid for it? Sh30 a kilo! What joke is that? That is why my sons abandoned the land I gave them. So now I have decided to diversify my farming instead of just uprooting coffee like everyone else. I now grow Irish potatoes in between the coffee trees.”


Before 2000, coffee farmers were not allowed to inter-crop coffee with anything else — even when it was not paying.

But even after the government tried to liberalise the sector, coffee cartels have lined up to frustrate farmers such as Mr Wainaina.

“Since 1977 when I built my house, I haven’t been able to do anything for myself with the money I make from coffee. Because I make nothing! I can’t even afford to build a decent kitchen for my wife.”

The expression on his face changes and sadness clouds his features.

He’s saying something, but I can’t quite hear him because he seems to be speaking to himself. That pained smile flashes across his face again.

“A long time ago, I used to harvest up to 20 bags a day. That’s about 1,800 kilos. These days I can’t hit that. I was recently paid Sh30 (a kilo) after I had harvested 839 kilos. When you do the math, that’s Sh25,000. I had previously gone to Murata Sacco and they gave me a Sh10,000 loan for harvesting. When I got the Sh25,000, I found that the co-operative had already deducted Sh14,000 for inputs and factory charges. I was left with Sh11,000, out of which Sh10,000 went back to Murata to repay the loan. That left me with Sh1,000 only! One thousand! What am I supposed to do with that?”

Mr Wainaina says Sh30 is the lowest he has ever been paid for his coffee.

“The person who is killing the coffee farmer is the miller. When the coffee leaves my farm it goes to our sacco factory for drying. From there we deliver to the miller and that is where our job ends. I don’t know how much they sell for so even if they came and gave me Sh10, I have no way of knowing if they pocketed Sh50.”


Small-scale farmers need their own mill, he tells me, “so that we can cut our costs and be empowered to sell our own coffee directly, such that whoever wants to buy my coffee comes directly to my sacco factory. That way, I will benefit.”

I finally ask him the most obvious question — If the coffee business is that bad, why doesn’t he quit?

He looks at me for what seems like a minute, coughs dryly and spits. He seems a little offended by my question.

“Coffee is my life,” he says. “I love these trees so much because they know my struggles. I am here today because of these trees. I will not uproot my coffee because I have faith that the government will listen to my plea. The cartels have to be disbanded.”

We end the interview and as he escorts me out of his home, he tells me about his other crops, that are making him a lot more money than coffee. Like avocado trees, which he says yield 3,000 fruits per tree. He sells each fruit at Sh8 shillings.


Two kilometres from Mr Wainaina’s farm, we find Mr Edmund Gichuhi Kiarie, tending to his cow. This cow, he says, is now his primary source of income, despite the fact that he has three acres of coffee.

“I have been a coffee farmer for the last 35 years. Over the years I have seen this business change in ways that I can’t even explain. People have died, you know, because of the shock they get when the coffee money comes in. It is so little, if you have debts to pay you will be in debt forever.”

He adjusts his jacket briefly and shifts on his feet slightly, turning his face away from me.

“This year I harvested 1,200 kilos and I was paid Sh30 for each kilo. That is just Sh36,000 and my cost of production is Sh20,000. So even if I wanted to put money back into the farm, I can’t! I can’t afford it! It’s like all year I am working for just Sh16,000!”

So why do it? I ask him. And just like Mr Wainaina, he’s offended.

“You’re young. You have alternatives. I don’t. I can’t go looking for a job at my age. The best I can do is till the land and pray that one day my effort will pay off.”

Mr Kiarie has a son, and he is not interested in participating in this coffee racket.

“’This thing will kill you’, my son says to me. He tells me to leave it alone. But I say no. All we need as farmers is for the government to give us subsidies like they do with maize, and to give us a coffee revolving fund that can give us affordable loans.”

How much would he want to be paid, I ask.

“I heard recently on radio the Governor of Murang’a (Mwangi wa Iria) saying that farmers will be paid Sh100. If you ask me, Sh50 is enough. Just give us an assurance than no matter what happens in the market, the farmer will always get Sh50. Look at my farm. I have capacity to produce 2,000 kilos. If you give me Sh50, that’s Sh100,000. If I take away my Sh20,000 cost of production, I’m left with Sh80,000. That is a lot better than the Sh16,000 I got this year.”


He shows me the house he built using his coffee proceeds in the 70s. He has a modest home, with a few domestic animals. He wanted to build a bigger and better house, but that is a dream he has now shelved.

“Giving up on dreams is what we do best these days,” says Mr Paul Karanja, the Chairman of the Kabati Farmers Cooperative Society who came along with me on these interviews.

He says he’d like to show me his farm, and I let him lead the way. He has eight acres, growing mostly coffee, but has diversified into macadamia, avocado, sugarcane and beekeeping.

“I first planted coffee in 1978. Things were so different back then. The money we earned was enough for us. Today we hear that there are cartels in the coffee business. We don’t know who is in these cartels.”

We’re sitting under a tree outside his house for this interview. I hear cows mooing in the background, and I smell rabbits.

Yes, he keeps rabbits too, he says. “It’s a lucrative business! I also have geese and chicken,” he smiles broadly.

“It’s not that I have given up on coffee, no. It is just the market that is unfair to us. We have all the knowledge a farmer needs to grow high quality coffee thanks to the frequent farmer field schools hosted by the Coffee Research Institute. But what good is this knowledge if it doesn’t translate into money in the bank?”

He poses briefly, staring at the geese crossing in front of him — just the way the cartels have done.