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Private millers linked to cartels behind Nyeri coffee theft

The news have sounded more like fiction. That more than 4,000 bags of coffee worth about Sh100 million can be stolen from factories and transported by road past police roadblocks without detection comes out as a fictitious story.

Yet that is what has happened in Nyeri county and the surrounding coffee-growing areas in the past one year Just this week, 300 bags of processed coffee were stolen from three factories in Nyeri.

And at the time of going to press yesterday, police had still not made any headway in unravelling the puzzle. Curiously, coffee theft cases have only been reported at factories owned by small-scale farmer co-operative societies, which in the past one year have been struggling to break the monopoly of powerful individuals and multinationals who dominate coffee industry in the country.

Twelve co-operative societies have seen their stores raided and coffee worth more than Sh100 million stolen. Nyeri county executive in charge of trade Stanley Miano says the thefts are a well-organised scheme by entrenched cartels to sabotage the county governments’ initiative aimed at empowering the farmer to sell coffee directly to the end-users overseas.

In the last two years, Nyeri Governor Nderitu Gachagua has made high-profile visits to foreign countries, where he clinched deals for direct coffee sale to international markets without going through the auction.

“We can reveal that the thefts are part of an elaborate scheme by cartels and their brokers to regain control of the industry which has been slipping off their hands. The idea is to portray coffee handled by farmer co-operatives as insecure,’’ said Miano.

Insiders who spoke to the People Daily in confidence disclosed that the stolen coffee first lands on the doors of private coffee millers where it is re-packaged ready for auction at the Nairobi Coffee Exchange.

“Once the stolen coffee enters the gates of a private miller, it is as good as lost forever because it is mixed up with the miller’s crop,” said the source, who sought anonymity given the sensitive nature of the matter.

“The intended message to the small-scale farmer is that he/she can’t do without brokers. That it is either they surrender their coffee to brokers and private millers at throw-away prices or risk losing their harvests to ‘thieves’! It is both criminal and a blackmail,” added the source privy to operations of the syndicate.

Further inquiries gathered that the syndicate loops in foreign coffee traders, their local agents, factory managers entrusted with farmers coffee and security agents. Curiously, police in Central region and elsewhere have never intercepted any stolen coffee on transit.

Neither has any investigations been conducted in regard to the same. Contacted, Central regional police coordinator Larry Kieng, instead shifted the blame to farmers, who he alleged never report theft to police but “only rush to the media.”

He said: “The problem is those coffee farmers. Instead of coming to us, they report to the media. How does that help them?” Told it is factory managers and guards keeping custody of the coffee who are supposed to alert police of the thefts, the police boss said: “Even those never come to us.

We only get to know about these things from the newspapers.” The regional police commander however, contradicted himself when he said he had alerted his base commanders to keep an eye on coffee factories in their areas of jurisdiction in the wake of increasing cases of coffee thefts, meaning he was not only aware of the incidents but had investigated and found them to have taken place.

However, Governor Gachagua didn’t mince his words when reached for comment on the same, saying: “It is simple. Don’t even bother talking to the police. They’re part and parcel of the stealing syndicate.

Go and quote me on that!” The governor said his administration donated six vehicles to the police last year to enhance their mobility and boost patrols, hence no good excuse not to respond to alarms raised at the factories whenever there is a break-in.

“They can stop it if they so wish. Unfortunately, they’re part of the racket”, said a furious Gachagua. There are 11 licensed coffee millers in Kenya, eight of which are renowned foreign brands and a few local large-scale coffee growers.

The other three licensees are small-scale farmer co-operatives, and which are now victims of organised coffee thefts. Kenya’s oldest coffee trader, C Dormans owns Nyeri-based Central Kenya Coffee Mills and CMS Mills in Ruiru, Kiambu county.

The next big miller is Highlands Mills owned by Sangana Commodities Ltd. Sangana is a wholly owned subsidiary of the Swiss multinational commodities trader, ECON group. Ibero Kenya owned by German coffee multinational, Neumann Kaffe Group, is third is size and owns NKG Mills in Ruiru.

The German firm also owns a management and marketing agency licenCe under Tropical Farm Services. In the local category, the big guns of the industry include the family of former Cabinet minister Jeremiah Nyagah, which is in joint venture with investment banking multinational Renaissance Capital. They run Kofinaf mills which operates under the Kofinaf Group.

The group is also behind the Sh250 billion Tatu City project in Kiambu county, and also runs coffee estates including Eaagads, Mtaro, Mchana and Oakland in Kiambu. Sasini Coffee mills is owned by business magnate Naushad Merali under his agriculture investment firm Sasini Coffee and Tea.

The other two private millers are Thika Coffee Mills and Nyambene Coffee Mills. Thika Coffee Mills is owned by billionaire Pius Ngugi and sells its coffee through Kenya Nuts, a sister company.

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