Kenya is seeking partnerships with Chinese investors for joint coffee processing ventures as the country seeks focus from the traditional European market to Asia and the African markets.
Kenya currently sells most of its coffee to Europe where its variety of Arabica coffee regarded as of the best quality in the world, is used to blend other coffees to improve taste. The Coffee Board of Kenya (CBK) Managing Director Loise Njeru said what Kenya requires is local processing and packaging capacity to improve export of processed coffee to the emerging foreign coffee markets.
Kenya currently exports nearly all its coffee in raw form, limiting revenue farmers can earn from the crop and its impact in creating wealth and employment.
Raw coffee is also highly vulnerable to global price fluctuation that denies farmers the true value of their produce. “We are looking for partnerships on value addition, packaging and branding with Chinese investors,” Njeru told Xinhua in a recent interview in Nairobi. Kenya will be seeking knowledge transfer from the Chinese partnership, including access to machinery that the country requires to process and package coffee.
Access to appropriate machinery is one of the major challenges facing Kenya enterprises that want to venture into coffee processing and packaging, limiting most of the local business people to being export brokers of the raw produce. Increasing capacity of local coffee processing is part of the plan to make Kenya the global hub of coffee export, a spot currently held by Germany that does not produce coffee.
As part of this plan, Kenya has rolled out plans to promote growing of Robusta coffee in non-traditional coffee growing areas to boost production adequate to support a processing industry. Robusta coffee is also preferred for processing into instant coffee whose demand is growing across the world.
China’s partnership will also ease Kenya’s efforts to access China’s growing coffee consumption, seen as the fastest in the world and one of the most promising because of the country’s high population. “China is a very exciting market for the Kenyan coffee. The rate of coffee shop growth offers high potential and that is why we want to have this partnership with Chinese investors,” said Njeru.
Kenya does not have a strong history of coffee trade with China, with first major coffee exports to the country having started in 2007.
But growing trade relations with China, encouragement of business-to-business partnerships between the two countries, the economic crisis in Europe and the big Chinese market are some of the factors that have raised interest for extension of coffee industry as one of the core areas of business relations.
