Maize farmers will have to wait a little longer to deliver their produce to the National Cereals and Produce Board (NCPB), meaning brokers and cartels will have a field day in purchasing the bags at throw-away prices.
The board is seeking Sh7.56 billion to buy three million bags at Sh2,700 per 90-kg as it faces stiff competition from millers and traders who purchase them at the farm gate in cash.
There’s an anticipated shortage of the staple caused by declined yield this season. NCPB chairman Mutea Iringo said yesterday the board plans to buy 100,000 bags of 50-kg of rice at Sh600 million, 30,000 bags of green grams at Sh270 million and 20,000 bags of 25-kg powdered milk at Sh340 million.
The NCPB has, however, not opened its stores to maize farmers for the National Food Reserve this financial year.
Brokers in the North Rift region are offering Sh2,300 per 90-kg bag of maize, down from Sh2,800 two months ago due to a projected shortage after the yield dropped by 11 million bags, from 44 million to 33 million.
“We are still waiting for guidelines to begin receiving maize from farmers,” NCPB communications manager Titus Maiyo said.
Farmers decried exploitation from traders and urged the government to hasten the process of opening up NCPB buying centres to cushion them from further losses.
“The board acts as market stabilizer by offering attractive prices and delays in opening buying centres is giving cartels field day to exploit us by offering low prices,” said Mr David Too from Moi’s Bridge in Uasin Gishu.
Harvesting of maize is ongoing in most parts of the North Rift and farmers need to sell the produce to meet their needs and invest in the next crop.
“Agriculture is the backbone of the economy and the Big Four Agenda. Small-scale farmers need to be offered incentives such as low cost farm inputs like seeds and fertiliser. They also need attractive prices to enable them earn profits and continue investing in the crop,” said Mr Jackson Kosgey, an agronomist in Eldoret.
He said small-scale farmers need to be protected from cheaply imported produce, adding that allowing market forces to dictate prices will stop them from investing in commercial production.
“As much as the government has introduced reforms in agriculture, they work to the advantage of large-scale farmers. Small-scale cereal growers need cash for personal needs and capital to invest in the next production,” said Mr Kosgey, adding that reforms should be introduced in phases.
In recent changes announced by Agriculture Cabinet Secretary Peter Munya, the government will no longer buy maize and offer subsidised inputs, which has in the past been characterised by inefficiency and graft.
The Cabinet approved the Warehouse Receipt System (WRS), an open trading platform that links buyers with sellers in a manner similar to that of the stock exchange.
It will remove the logistics burden and facilitate producers and traders to access agricultural credit against the deposit certificate.
“The government will not directly buy, sell maize or set prices of maize. It will no longer purchase, distribute, sell or set prices of fertiliser, seeds or any farm inputs,” Mr Munya said.
The changes will see NCPB trading division undertake commercial storage and commodity trading activities.
Experts have decried the maize sub-sector’s over-reliance on resource allocation from the Ministry of Agriculture, which has hurt the broader role of improving food and nutrition security.
“The reforms will see most farmers reduce acreage under maize production since they cannot be guaranteed markets for the produce. This will pose a threat to food security,” said Mr Malakwen Kosgey, a farmer from Moiben, Uasin Gishu County.
Some unscrupulous traders collude with influential State officials to abuse open markets by flooding the country with cheap imports, knocking farmers out of business.
“When structural adjustment programmes were introduced in the 1990s, the agriculture sector was hard-hit with maize prices dropping as low as Sh800 per 90-kg bag. The government needs to implement clear policies to ensure proposed reforms do not hurt the sector and result in food insecurity,” said Ms Sally Chesang, a farmer in Elgeyo-Marakwet.
President Uhuru Kenyatta assented into law the WRS Bill 2017 in 2019, which provides a legal framework for development and regulation to address marketing challenges associated with the maize sub-sector.
The system allows farmers to deposit maize in a licensed certified warehouse and are issued with receipt equivalent to the quality and amount of grains deposited.
The farmers can use the receipt to secure loans from financial institutions as collateral as they wait to sell their produce at competitive rates.
