[Kenya] Capital Markets Authority licenses four new coffee brokers
In an effort to deepen coffee sub-sector reforms, the Capital Markets Authority (CMA) has licensed four more coffee brokers. Kinya Coffee Marketing Agency Limited has been granted a full license while Kiambu Coffee Marketing Company Limited, Bungoma Union Marketing Agency Limited and Meru South Coffee Marketing Company Limited have been granted in-principle approved licenses for six months.
The coffee brokers were licensed under the Capital Markets (Coffee Exchange) Regulations, 2020. This brings the number of coffee brokers so far licensed by CMA to ten.
Other coffee brokers holding valid licenses earlier issued by CMA are; United Eastern Kenya Coffee Marketing Company; Meru County Coffee Marketing Agency Limited; Kipkelion Brokerage Company Limited; Mt. Elgon Coffee Marketing Agency; Murang’a County Coffee Dealers Limited; and Embu Coffee Farmers Marketing Agency Limited.
These developments come on the back of extension of the in-principle approval granted by CMA to the Nairobi Coffee Exchange (NCE) to continue operating as a coffee exchange from 31 December 2022 to April 30, 2023 to give room for transition and progression towards full regulatory compliance with the Capital Markets (Coffee Exchange) Regulations, 2020. The NCE is expected to immediately admit entities holding valid coffee broker licenses issued by CMA to the trading floor.
The CMA Chief Executive Officer, Mr. Wyckliffe Shamiah, observed, ‘’the momentum of the reform agenda needs to be sustained to ensure full implementation of the Coffee Exchange Regulations. This is expected to ensure the marketing and trading mechanism at the Coffee Exchange promotes fair trade, is transparent and enhances price discovery, ultimately benefitting the coffee farmers.’’
The Agriculture and Food Authority also withdrew the June 2022 amendments to the Crops (Coffee) (General) Regulations, 2019 hence harmonization with the Capital Markets (Coffee Exchange) Regulations, 2020 thus the current positive outlook for coffee subsector reforms.
The Capital Markets Act was reviewed in 2016 to expressly provide CMA the mandate to regulate spot commodity markets including the coffee commodity market in Kenya. CMA regulates the structured spot commodity markets and in particular, the coffee commodity market according to Section 11(3) of the Capital Markets Act.