Identifying opportunities for value chain development in the Kenyan coffee sector

Abstract

By developing a model that describes the Kenyan coffee value chain, this study evaluates opportunities emanating from four scenarios representing productivity gains in the various value chain stages of the coffee sector and additional three scenarios reflecting shifts in market situations. Results show that productivity-enhancing policies have stronger effects on coffee output and export performance if they target the milling stage of the value chain. Export subsidy and favourable external marketing conditions also have stronger effects, distributed comparably across the various value chain stages. We, however, found that these gains in the coffee sector come at the expense of other cash crops such as cotton, tea, sugar and tobacco. The approach followed in this study is relevant as this trade-off between coffee and the other cash crop sectors may not be visibly shown using standard value chain approaches.

Market Cost Factors Affecting Marketing of Small Holder Coffee Producers in Rwanda

“…Unexpectedly in our study findings, the results indicated positive relationship between cost of transportation and quantity of coffee produced. One unit increased to cost of transport, the expected quantity of coffee production shifted to 0.75 percent of coffee and our findings are similar to the results of Aragie (2018) in their study on identification of opportunities for value chain development in the Kenyan coffee sector by adoption of a modeling approach. The results in table 1 also indicated that distance from farm to nearest road was statistically significant the marketing factor affecting the marketed coffee production at 5% level of significance.…”