What is a cash crop? According to Wikipedia, a cash crop is any crop that is grown for money. In Kenya, Coffee, Tea, Pyrethrum etc are the main cash crops. Our grandparents raised our parents on these crops, educated them and built concrete floors using cash crop proceeds. But according to my grandfather who passed away last year, his coffee farm no longer provided cash but rather consumed it. Being a practical guy, I spend very little time following discussions at the World Trade Organization or a gazillion other organizations that seek to level the playing field on farm subsidies etc. I believe these discussions are a critical part of the overall solution, but I also think there needs to be some "hard ball" play so to speak.
How many Kenyans drink coffee? Besides the Java Coffee shop enthusiasts who pay $3 for a cup of Coffee in Kenya, there is a very limited audience for coffee ( happy to take corrections). Most people I know drink tea. So why do we produce such a vast amount of coffee? Because at one time, it was a great crop. It still is, but relative to other crops, its lost is caffeine. I propose we clear 80% of our coffee farms and grow a "real cash crop". Jathropa.
At the risk of simplifying this too far I'll attempt to illustrate; the farmer makes very little money on coffee, spends a fortune on pesticides, fertilizers and labor and gets $.50/lb for his coffee. Per hectare, a coffee farmer's best case scenario is $732 net assuming a conservative 40% cost of fertilizer, labor and pesticides. In contrast, Jathropa is $900 net. The key would be to modify all the local coffee processing plants into jathropa into biodiesel processing plants. The infrastructure exists. Each area near a processing plant has matatus, tractors, lorries, generators and SUVs, all of which would be ready customers for biodiesel and would pay cash for it. No 3 to 6 months waiting period for the farmer to get paid.
These are not scientific figures, but they certainly raise the question of what should we consider a cash crop. And this would have a lot of positive consequences. Suppose the supply of coffee dropped by 80%, those who chose to stay in it could get a better price at the market, they would be calling the shots. Diesel prices would either have to come down from their current ksh 100+ to compete with biodiesel ( Ministry of energy estimates Biodiesel at ksh. 45/litre, I think that is a tard aggressive) or seek customers elsewhere.
And food insecurity would not be an issue for the Kenyan coffee grower.
To put the issue of cash crops in context, a couple of years ago, when the oil price per barrel was at the bargain basement price of $60 per barrel, my company's shipping costs for fresh fruits and vegetables to Paris were 50% of the total delivered value of the shipment in France. I hate to think what that ratio looks like today.
If you are growing coffee for sentimental reasons, like my mother who keeps a couple of cows for the same, or the California guy in Los Altos Hills who has a 20,000 square ft home and 10,000 s/f vineyard, then keep the coffee. If you are interested in a revenue stream, rethink the whole coffee as a cash crop thing.
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The problem with the term cash crop is that like every other thing there are certain dynamics that go with the title. During the coffee boom year Kenya benefited substantially because several factors that came together in rather an act of a miracle. Other coffee producers had a bout of terrible weather and government commitment to up-lifting the lively hood of its people were at peak. Another aspect to this was labor was available at below market rate(I stand to be corrected) before the rural urban migration peaked.
Like I mentioned afew dynamics in cash crop production did not change with the times. Land tenure system continues to be in sharp contrast to cultural practices of divvying up the land among the sons. Modern agriculture demands economies of scale to be profitable. With the rural-urban migration, the skill and labor began to run short, there was no substantial capital investment to take the place of this labor. At the same time the continuous land subdivision made major capital investments in machinery unfeasible.
Solution? Government need to play a greater role in pushing for policy that promotes large land holding. Cultures should also embrace the new reality and re-evaluate the practice of land demarcation. Markets shift in the same way production should work to project the shift. Shifting in agriculture production can take years if not decades because so crops such as tea thoroughly deplete the soil
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