The truth about coffee farming: it’s a recreational activity!

By MUNGAI KIHANYA

The Sunday Nation

Nairobi,

18 November 2018

Last month, I heard a coffee farmer from Murang’s complaining on TV about the compensation he was offered for his crop which was to be uprooted to make way for the Northern Collector Water Tunnel. The amount was Sh2,000 per tree.

The farmer did not say how much would be fair in his view. Listening to the news report got me wondering: how much is a coffee tree worth?

As luck would have it, I have many members of extended family living in Murang’a county and most of them are small scale coffee famers. I spoke to one of them candidly and he revealed that, last year, he made a profit of Sh250,000 from his 7,000 trees.

Dividing the profit by the number of trees, it turns out that my relative made about Sh35.70 per tree! Considering that this is the region of the country, it is fair to assume that the farmer who appeared on TV makes similar income from his crop.

So, a payment of Sh2,000 per tree is very generous offer. He is being compensated for about 56 years of income. Considering that Kenya’s average life expectancy is about 67 years, almost a lifetime!

That was quite an unexpected outcome. So, I checked the numbers from one of the major companies involved in coffee farming – Sasini PLC. It has about 2,000 acres (780ha) of land under coffee and, according to the 2017 annual report, the company made a profit of Sh42 million from this crop.

This comes to about Sh21,000 profit per acre in one year. In other words, Sh1,750 per month, per acre! Now we can appreciate why so many farmers have uprooted coffee and put up buildings on the land.

You can easily fit 10 simple houses on one acre of land. If you charge Sh10,000 rent each, your income comes to Sh100,000 per month. Compare that to the Sh1,750 from coffee.

Still, the Sasini PLC numbers are profit per acre. To get profit per tree, we must find out how many trees there are in one acre. Coffee is planted in lines that are about 2m apart. The trees have a spacing of about 1.5m. Therefore, each tree takes an area of about 3 square metres – about 32 sq.ft.

One acre is equivalent to 43,560 sq. ft.; so, if each tree takes 32 sq.ft., then there are about 1,360 trees per acre. With a profit of Sh21,000 per acre, it turns out that Sasini PLC made about Sh15.40 per tree. This is even worse than my relatives in Murang’a!

For the farmer who appeared on TV, Sh2,000 per tree comes to Sh2.7 million per acre. I think this is also a fair price for agricultural land in that region of the country.

My conclusion from all these numbers is that coffee farming in Kenya is largely a recreational activity undertaken for sentimental reasons. It has no commercial value!