Decomposition of the Coffee Value Chain Among Smallholder Farmers in Embu and Kirinyaga Counties in Central Kenya

Abstract

The coffee value chain is lengthy and complex with numerous actors and this exposes the farmers to inherent financial risks. This study sought to decompose the coffee value chain and its dynamics. The study was undertaken in Embu and Kirinyaga counties in Central Kenya and the target population was smallholder coffee farmers. The study used multistage stratified sampling techniques to draw a sample of 385 respondents. Majority (97%) of the sampled farmers were processing and marketing their coffee through cooperative societies. Socioeconomic analysis of these farmers showed that majority were middle‐aged, fairly educated and with adequate coffee farming experience but their cherry production was very low averaging 2.3 kgs per tree for 2022/2023 crop year. The cooperative societies were playing key roles in the coffee value chain including farmers’ training, input and credit provision, coffee processing and marketing. There were numerous coffee marketing challenges, including high middlemen involvement, which lowered the coffee prices and reduced the trade volumes. Value adding activities such as roasting, grinding, and packaging were rare and farmers’ involvement in the upstream value chain was minimal. The local demand for the produced coffee was very low with domestic consumption taking only 2% of the output. The multilevel mixed effect model results revealed that value adding and farmer involvement were found to have a significant positive influence on the traded volumes and coffee prices while middlemen involvement had a negative influence. There is need for enhanced value adding and farmers involvement in the upstream value chain as well as strengthening the cooperative societies’ role in coffee marketing for more accountability and increased incomes.