Australia is set to sign a bilateral agreement with Kenya on direct coffee sales to help address the issue of price fluctuation that has over the years cut returns to farmers.
Kenya is in the process of inking a deal with the Oceania nation to facilitate direct coffee exports, a move that will boost growers earnings and the country’s foreign exchange.
Currently, the bulk of coffee exported to Australia is through the Nairobi Coffee Exchange where the beans are auctioned first before they are shipped to the international market, with the nation ranking among the top 10 buyers of Kenya’s beverage globally.
Australian High Commissioner to Kenya, Luke Williams says Kenya is also open to buying wheat from their country to bridge the local deficit.
“Australia has a huge untapped coffee market, that can be Kenya’s alternative market, to cushion Kenyan farmers from fluctuating global coffee prices,” said Mr Williams.
This comes at a time when Kenya is focusing on increasing value addition on tea that is exported to Australia, making it one of the key markets for the country’s top beverages.
President William Ruto’s government through a Cabinet directive in February started exporting value-added tea to this nation, which could correct the trade imbalance between the two countries that is currently in favour of Australia.
Kenya exports to Australia amounted to Ksh1 billion in 2022 which was a decline from Ksh950 million realised in the same period in 2021. The volumes exported to the destination dropped from 1,400 tonnes last year to 1,300 a year earlier.
The official made the remarks during the official opening of the international agriculture conference on innovation and research, which seeks to improve food security in the country.
The envoy said the Australian centre for international agriculture research and the Canadian international development research centre have earmarked a Sh3.7 billion programme to strengthen the country’s food system through investments to smallholders and reduction of post-harvest losses.
Kenya exports most of its coffee as cleaned beans, with only five as roasted coffee. According to the directorate, Kenya exported 98 percent of the commodity in the review period as green beans.
Roasters buy Kenyan produce to blend with lower-quality beans from elsewhere in the world, making the country, miss out on the added value from selling roasted and packaged coffee.