Hundreds of farmers delivering their produce to Rumukia Coffee Cooperative Society in Nyeri county face the prospect of getting little or no payment for their crop.
There is anger and despair following the announcement that farmers will get nothing from last year's crop with farmers threatening to uproot their coffee plants.
Over the years, the management of the cooperative has been borrowing from banks and other financial institutions to pay farmers and selling their produce to settle the loans.
Trouble started when board members borrowed from banks and squandered the money instead of paying farmers.
Without the knowledge of members, outgoing managers borrowed more than Sh21 million and secured the debt with farmers' produce in the 2019/20 financial year.
An interim management appointed in February following farmers' persistent protests revealed the Rumukia's dire situation after Taifa Sacco, through Green Belt Movement, threatened to auction the factories to recover a Sh163 million debt.
Contacted, interim chairman Mbote Kanyi said his team has inherited a broke organisation that has not paid its staff for eight months.
"We have learnt that a loan was secured from the Coffee Management System (CMS) against last year's crop. These details were concealed from the interim management during the handing over," Mr Kanyi said.
Apart from what Taifa Sacco is demanding, Rumukia Coffee Cooperative Society owes 36 workers, who were summarily dismissed, some Sh22 million.
The once giant cooperative with more than 8,000 members and a capacity to produce three million kilogrammes of coffee annually now has about 1,000 farmers.
A majority of its farmers left and registered with better-paying cooperatives in neighbouring sub-counties, while others resorted to hawking their crop.
The collapse of many coffee societies in Nyeri has been blamed on misconduct and abuse of office by managers.
Borrowing, lack of professionalism and poor managerial skills are among the reasons that have contributed to the running down of factories.
"We're introducing a law that will ensure every loan is approved by farmers. We also want to ensure borrowing is limited to a banker known to the farmer," Mr Kanyi said.
Rumukia Coffee Cooperative used to be among the top-paying societies in Nyeri.
An audit conducted in 2021 showed that the debts were secured against title deeds and coffee proceeds.
"The audit was not substantive since no one was held to account. There was theft, but somebody failed to pinpoint this during the audit," Mr Kanyi added.
He said that Rumukia Coffee Cooperative Society cannot pay farmers because "we're doing all we can to stop the borrowing culture adopted by the previous management".
Mr Kanyi added: "Farmers' money has been recouped by the marketer to service a loan granted against our crop. We cannot continue borrowing to pay farmers."
He said that his team is in talks with Taifa Sacco on the interest accruing on the Sh163 million loan.
"We've met the sacco and are also talking to the government with the aim of having the debt written off," he said.
Mr Kanyi's team wants a grace period of five years to encourage farmers to return to the society and start producing more coffee, which will allow the repayment of the loan for three years.
Bills to settle
Last year, Nyeri Governor Mutahi Kahiga attempted to salvage Rumukia Coffee Cooperative Society by having it and Taifa Sacco sign a deal that would see the loan repaid in six years.
"It was a crisis document that was to quell tension since our farmers were protesting. Unfortunately, the deal was not meant to achieve anything," he said.
The agreement stated that once the coffee was sold, the sacco would get part of its money from the proceeds, with the balance being given to farmers.
But with dwindling produce and the number of kilos collected in every factory, the cooperative will have a hard time paying farmers.
Mr Joseph Kebu, a farmer affiliated to Rumukia Coffee Cooperative Society, harvested 3,000 kilogrammes of cherry last season, but did not deliver anything to his factory.
He opted to sell to a processor in a neighbouring sub-county, arguing that he has school fees and other bills to settle.