We must consume our coffee to stabilise future price of the commodity

Metaphorically on coffee matters, we are like the proverbial gold prospector, who spent his entire life scouring distant mountains for gold only to die as a pauper. When his friends were digging the grave to buy him in his own backyard, they struck gold everywhere.

Undoubtedly Kenyan coffee is brand and its global reputation as the best quality coffee and home of specialty coffee is well documented. As a result of the on-going farmer-centric coffee reforms, coffee prices have greatly improved with some coffee farmers enjoying some of the phenomenal prices ever recorded.

Consequently, this phenomenal has triggered a frenzy expansion of coffee acreage even in traditional non-coffee growing zones. Whereas these historical prices have stirred buoyancy of great expectation of bright future, it is not a panacea to the coffee problem. We are not yet out of the wood. We must start consuming our own coffee.

The coffee problem is a manifestation of volatilities of coffee prices due to inherent inelasticity of these prices. This intrinsic inelasticity is attributable to three key traits of coffee as an exportable commodity.

First, it is mainly grown and produced in equatorial belt but consumed in the North and South belt.

Second, coffee is perennial crop with long gestation period of 3-4 years and longevity of 100 years depending on the variety.

Third, the price transmission mechanism from coffee cup prices to green coffee prices is distorted by the monopsonistic dominance of international roasters. Part of the solution lies on the promotion of domestic consumption as evidenced by our counterpart, Ethiopia with half of its total production being consumed locally.

The domestic consumption strategy must be anchored on intergenerational equity. The strategy must be youth-centric with specific reorientation to the preferences of Generation Z and Millennials who account for over 70 percent of Kenya’s population.

This youth bulge is well-educated, techno-savvy, culturally influential, entrepreneurial and importantly, they are patriotically civic-minded.

Consequently, they are uniquely positioned to reshape the future of the domestic coffee consumption habits. Harnessing, encouraging, promoting and empowering them will be catalytic in the entrechment of domestic coffee consumption in Kenya.

The strategy must be designed to transform coffee from an export commodity into a widely enjoyed domestic beverage and lifestyle product, driven by trained youth operating across the entire value chain — from farm to cup and from farm to culture.

Execution of the strategy demands a broader education curricula with extensive and intensive training on roasting, brewing and cupping, which are the most profitable phases of the coffee value chain but least understood locally.

The training should also incorporate a youth-centric post-harvest processing and flavour design with a component of inculcation of coffee drinking culture.

Moreover, ensuring equipment accessibility including fostering and nurturing young entrepreneurs with bankable business models.

In conclusion, to reduce the uncertainties of future coffee prices and counter the monopnistic dominance of international coffee roasters, we must conscientiously increase domestic consumption.

Prof Kieyah is a policy analyst at Kippra