Coffee trading system to be reviewed says minister

Uganda coffee in hot demand in Italy as exports climb to 30-year high

Songwe. Agriculture minister Hussein Bashe said a team of experts will be dispatched to the Southern Highland regions to commence the process of reviewing the coffee trading system.

The minister’s decision comes after discovering that the farmers are being underpaid and exploited by cooperatives through the present system.

Mr Bashe, who doubles as Nzega Urban legislator, announced the decision here when concluding a tour of the region during a meeting attended by different government leaders and agriculture stakeholders. During the meeting, Mr Bashe revealed that there were indications that cooperative unions used levies loopholes to underpay and exploit farmers.

The most important indication unfolded when coffee farmers and members of Isaso Agriculture Marketing Cooperative Union (Amcos) claimed to have not been paid their money, despite taking their produce to the Amcos several months ago.

These reports triggered Mr Bashe’s instruction that Isaso Amcos secretary and other leaders should be arrested pending the payment of farmers’ money.

Speaking during the meeting, Mr Bashe said the said team of experts would be dispatched this month.

According to him, the team will be responsible for meeting coffee stakeholders in the region including lawmakers, councillors and farmers.

“The team will visit all districts where they will gather all concerns from farmers. Finally, we will use the gathered details to design the guidelines to review the system,” he said.

“When carrying out a similar review in the Kagera Region, a lot was said. But my position was that farmers should cultivate, harvest, dry and take the produce for public auction,” he added.

He requested the Songwe regional commissioner, Waziri Kindamba, to convene a meeting of all Amcos in the region in order to establish the whereabouts of farmers’ money.

“If buyers are the ones who haven’t paid the money, then follow up should be made to establish the truth. Upon establishing that they are the ones hindering the payment process, then they should be arrested and sent behind bars,” he said.

Detailing the signs of exploitation, Mr Bashe said leaders of Isaso Amcos have provided contradictory information about the price of the produce.

“A cooperative officer said Grade III coffee was traded at Sh6,130 per tonne, but we are aware that the produce was sold at $230 per tonne (about Sh529,000),” he said.

“Grade II was sold at $165 (Sh379,500), while Grade III was traded at $150 (Sh345,000) per tonne. Provided prices cannot be substantiated even when the average price is computed,” he added.

Therefore, the minister said there are all signs that farmers have been conned because the farmers with different quality and grades of coffee had been treated equally.

According to him, a review of Isaso Amcos has revealed that its bank account had Sh434 million and that Sh26.6 million had been irregularly withdrawn by the arrested secretary.

Farmers' outcry

Vwawa Member of Parliament Japhet Hasunga said being one of the coffee farmers in the region, he hasn’t received his payment, despite sending his produce at the Amcos in June 2022.

A coffee farmer in Isansa Village whose name couldn’t be established immediately said he is waiting for a Sh1.4 million payment after trading 200 kilos of coffee.

Another coffee farmer from Wasa Village, Mr Daudi Simkoko, called on the government to increase its oversight on the crop, noting that coffee is considered to be the backbone of the economy in Mbozi District.

“The majority of unemployed youth have turned to coffee farming because it is among the most promising subsectors.

Therefore, the government should build a conducive environment that empowers farmers and enables them to transform their farming into irrigation agriculture,” he said.

Looming deductions

Reports from the region say a total of Sh560 is deducted from revenue generated from one kilo of coffee. Deductions include Sh150 and Sh30 payable to the Amcos and operation costs.

Other deductions are the Sh200 levy paid to the Tanzania Coffee Board (TCB), Sh150 for the council as well as Sh10 and Sh20 for cooperative unions and crop processing sustainability.

“The system of selling coffee in the Southern Highland regions is very unfriendly to farmers. Why should farmers be deducted for packaging materials (sacks),” one stakeholder whose name couldn’t be known immediately told the minister.

“The person who buys the produce is the one responsible for covering transportation and packaging costs, not the farmers,” he added emotionally.