Farmers sorting coffee berries before taking to the Pulp[ing Machine. November 26, 2021. [Muriithi Mugo, Standard]
Brewing the truth: Real reason behind Kenya's coffee boom
Enterprise
By
Raymond Muthee
| May 21, 2025
Kenya’s coffee farmers are enjoying a rare windfall as the value of their beans surges, a welcome development for a sector long marred by underinvestment, debt, and exploitation.
The government has attributed the rebound to recent state-led reforms.
However, while those measures may have provided structure and stability, experts warn that the real story is more complex and largely driven by global market dynamics far beyond Kenya’s borders. Speaking during a church service at AIC Kapngetik, Elgeyo Marakwet County recently, President William Ruto claimed the government’s reforms had improved the coffee sector’s performance.
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The President noted that the government had brought in officials from the Capital Markets Authority to enhance transparency and protect farmers from exploitation.
“Now, when you sell your coffee at the Nairobi Coffee Exchange, after five days, the money is paid,” said Ruto.
He further explained that the reforms targeted inefficiencies in the cooperative payment systems.
“Those in cooperatives, since you get paid after five days, within ten days the farmer should have their money, not after six months,” he asserted, adding that timely payments were critical in restoring farmer confidence.
Yet a closer look reveals that global market forces, not domestic policy, are primarily driving this boom.
="https://www.standardmedia.co.ke/smart-harvest/article/2001519204/coffee-farmers-to-receive-centralised-payments-in-landmark-sector-reforms">The price surge< is part of a wider trend triggered by major production shocks in countries like Brazil and Vietnam. While Kenya’s reforms may have helped farmers take advantage of these conditions, they are not the root cause.
The world’s coffee supply is under pressure. Brazil, the largest exporter, has suffered prolonged droughts that severely reduced output.
A March 2025 Reuters report noted that many Brazilian growers had to invest heavily in irrigation, underscoring the growing threat of climate change to global coffee production.
According to the report, prices of Arabica—the most popular coffee bean used in most roasted blends—soared by 70 per cent in 2024 and rose nearly 20 per cent again this year, hitting a record high of $4.30 (Sh554.7) per pound on February 11. Robusta, widely used in instant coffee, spiked by 72 per cent in 2024.
Vietnam and Indonesia, key Robusta suppliers, have also seen declines in output due to erratic weather. Compounding the crisis, the United States imposed steep tariffs on Asian coffee imports, tightening supply and redirecting demand toward African producers.
T="https://www.standardmedia.co.ke/business/article/2001487061/coffee-reforms-standoff-persists-as-cs-appoints-transition-team">he result? A global “Globally, the C-price for coffee in New York has gone up due to a shortage of coffee in Brazil. It has an impact on local coffee prices, and this has nothing to do with the local policy. As for the latter, the impact is yet to be assessed,” he says.
According to the 2024 Kenya National Bureau of Statistics (KNBS) report, coffee exports rose by 12 per cent in 2024, reaching 53,519 tonnes, up from 47,861 tonnes in 2023. Revenues climbed to $296.8 million (Sh38.4 billion), compared to $251 million (Sh32.3 billion) the previous year.
Most exports occurred in the second and third quarters of 2024, with shipments of 15,903 tonnes and 17,017 tonnes, respectively.
Though the numbers are impressive, they follow the global pricing trajectory. There has been no significant increase in domestic output or acreage, signalling that the earnings boost is tied more to market forces than to increased productivity. Market forces notwithstanding, the government introduced a raft of measures aimed at favouring the subsector. One of the key measures includes the introduction of a guaranteed minimum return, setting a floor price of Sh80 per kilo, up from the previous Sh60, to shield farmers from market volatility.
In June 2024, the state also moved to ease the financial burden on producers by writing off Sh6.7 billion in cooperative debts. Additionally, a Sh4 billion revolving Coffee Cherry Fund was established to provide farmers with much-needed pre-harvest financing.
The government has set an ambitious production target: to double the country’s coffee output to 102,000 metric tonnes by 2027, up from the current 51,000 tonnes.
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