Cost of coffee production and returns in Kenya
The costs and returns to coffee production for three management groups of smallholders and two categories of large scale farmers for the period 1991/92 to 1994/95 are reviewed. Returns to labour and operating capital have also been analyzed. Full, partial annual costing procedure and models incorporating variable exchange rate and coffee prices were used. Cost of coffee production has been increasing from 1991/92 to a peak in 1993/94. During the current year, 1994/95, the average cost of production is projected at Ksh 53,591 and Ksh 91,712 per tonne of clean coffee in small and large scale farms, respectively. Revenue has significantly increased during the same period and small and large scale farmers are expected to receive Ksh 79,605 and Ksh 112,230 per tonne of clean coffee, respectively during the current year. Coffee production has been profitable since 1992/93 crop year. Farm profits are expected to remain positive within the exchange rate band of Ksh 40 to Ksh 60 per US provided the 1993/94 average coffee price of US 150 per bag is maintained. Smallholder farmers will be in a relatively better position to withstand simultaneous fluctuation in both exchange rate and coffee prices. Majority of coffee farmers will make losses if coffee prices decline by between 10 per cent and 26 per cent at an exchange rate Ksh 40 to 1 US . A sizeable proportion of small scale farmers in the low management group have returns to their family labour below the wage rate. This group of farmers may need special attention if they are to be retained in coffee production thereby avoiding sub-optimal exploitation of existing coffee production potential. A need for a study on ways and means of enhancing the benefits smallholder farmers can get from both macro-economic and coffee sector reforms is identified
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| Format: | biblioteca |
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| Subjects: | COFFEA ARABICA, PRODUCCION, ANALISIS DE COSTOS Y BENEFICIOS, COSTOS, EXPLOTACION EN PEQUEÑA ESCALA, PRECIOS, KENIA, |
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