Year costs, losses haunted farmers

2019 has been a tough year for farmers. From the influx of imported commodities to poor prices to high cost of production, they have been hit from all angles. Left at the mercy of middlemen, farmers have been forced to sell their produce at throwaway prices.

Timothy Njagi, a researcher at Tegemeo Institute, pointed out some of the challenges farmers have been grappling with, including inconsistent policies, climate change/unfavourable weather, pests and diseases. High production cost is another major problem hurting farmers.

“For example, the prices of milk have drastically reduced due to a glut in the market. Farmers cannot make a profit when they are selling a litre of milk at Sh20 or lower at the farm gate. You need to be a very efficient producer to make profits at this cost,” he said.

Njagi said if a farmer is producing a litre of milk at Sh30 and the market is offering Sh20, the discussion right now should be on how to bring down the cost of production to Sh15 so dairy farmers can make a profit.

Early in January, poultry farmers were complaining that cheap eggs from Uganda were flooding the market and affecting prices.

Then at some point, dairy farmers complained of milk imports from Uganda. Then there was the issue of imported maize from Tanzania and Uganda.

“We cannot stop these imports from coming into the country because we are in a common free market. The key thing we should be asking ourselves is how to lower our production cost,” he said.

An agronomist was quoted in the media saying farm inputs and animal feeds are expensive in Kenya because of the high taxation levied on the inputs.

He said the government should come up with ways of regulating the cost of farm inputs.

EXTENSION SERVICES

Njagi said extension services have died. This devolved service, he said, should be addressed urgently because farmers need new information, new technologies and better agronomical practices. “With the lack of extension services, they have nowhere to get this information from,” he said.

Njagi said the much-talked-about Big Four agenda is still not being applied on the ground. “At the grassroots, people are still doing the same old things. The priorities that were set aside for the Big Four agenda are not being felt or applied on the ground,” he said.

Njagi said it should start with planning followed by budget then implementation. “But if you look at the budget for the last two years, you don’t see prioritisation of agriculture on food security as envisioned in the Big Four. The national budget on agriculture is still at three per cent, contrary to the Maputo Declaration of 10 per cent,” the researcher said.

Some of the crops that have been impacted positively or negatively this year are maize, tea, sugar, cotton, rice and potatoes.

In June, President Uhuru Kenyatta announced that the government, in partnership with India, would be reviving Rivatex Textile Industry at a cost of Sh6 billion. The move was expected to increase consumption of cotton from 10,000 bales per day to 100,000 bales.

But cotton production remains low at 572kg per hectare against a potential of 2,500kg per hectare, according to the Agricultural Food Authority. Only 30,000 farmers grow cotton in Kenya, producing 4,000 metric tonnes against a market demand of 25,000 metric tonnes.

Experts in the cotton industry say the push to revive Rivatex should have been accompanied by efforts to get farmers to grow cotton to increase the area under cotton. Failing to address this will lead to the danger of having idle capacity, forcing us to import raw materials from Tanzania, they said.

In July, the country was once again faced with a shortage of maize, which led to a rift between Agriculture CS Mwangi Kiunjuri and the Strategic Food Reserve board chair Noah Wekesa over maize importation.

The two differed on whether or not to import 12 million bags, which the CS said was meant to cushion Kenyans against high cost of maize flour. Leaders from the North Rift also joined in to urge the government not to import as the onset of the long rains harvest was around the corner. The CS said the importation would only be allowed through a Cabinet decision but this never happened.

Millers have been relying on imports from Uganda and Tanzania, and over three million bags of maize released by SFR through the National Cereals and Produce Board at a cost of between Sh2,300 and Sh2,700 per 90 kg bag.

In September, farmers in tea-growing areas were restless in anticipation of the final payments or bonus.

In October, the Kenya Tea Development Authority announced the 2018-19 tea bonus, which had dropped by 25 per cent despite high production.

Farmers took home an average Sh41.27 per kilo of green leaf tea, despite production increasing from 477 million kilos the previous year to 481 million kilos.

The KTDA blamed the low bonus pay on a global market shock. In November, there was some good news for rice farmers as for the first time, the government announced that SFR had set aside Sh200 million to purchase rice from farmers for the grain reserve. Kiunjuri had said the government will purchase reasonable quantities just like it does with maize.

On sugar issues, farmers are still awaiting a report from the sugar task force appointed in November 2018 through a directive from the President. The team, co-chaired by Kiunjuri and Kakamega Governor Wycliffe Oparanya, was to look into ways of addressing the challenges facing the subsector and give its report after six months. To date, the report is yet to be released to the general public.

Potato farmers also have their share of problems, with access to certified seeds being a challenge. But this could soon end if a new technology on hydroponic seed production is anything to go by. The new technology is being developed by the National Youth Service in Timau in Nyahururu in partnership with the Kenya Plant Health Inspectorate Service.

Post-harvest loss is also a big problem that farmers have been facing, especially with the start of the October-November-December rainy season.

Agriculture PS Hamadi Boga said the ongoing heavy rains could spell doom for maize farmers in the North Rift due to a challenge in drying the maize. Boga said the country is likely to have post-harvest losses of 30 per cent, which will affect this year’s expected harvest of 33 million bags.

SUBSIDY PROGRAMME

On the government’s subsidy programme, Njagi said this is key but there has been a problem in the implementation and genuine farmers did not benefit.

“This year, the country did not have a big rollout on the subsidies. The Ministry of Agriculture is redesigning the subsidies for the main cropping season next year. We hope to see something new and well-thought-out, so the subsidies are effective. The programme must have an objective,” he said.

The World Bank this year did a report on transforming agricultural productivity to achieve food security for all in Kenya. The report, released in April, stated that Kenyan households that are exclusively engaged in agriculture contributed 31.4 per cent to the reduction of rural poverty.

The report’s special section on transforming agriculture sector productivity and linkages to poverty reduction was authored by World Bank lead agriculture economist Ladisy Chengula.

“We found that productivity increases in the agriculture sector not only benefit poor households but can potentially lift them out of poverty,” he said.

Despite progress towards achieving food security for all Kenyans, the analysis found that real agricultural value-added output has declined relative to levels attained in 2006.

“This was due to weather-related shocks, prevalence of pests/disease and dwindling knowledge delivery systems, such as the lack of extension services on the adoption of modern technology,” the report read.

The report further noted that traditional banking that is needed to service commercial agriculture is lacking, and that about four per cent of commercial bank lending is for agribusiness, despite most Kenyans being employed in agriculture or agribusiness.

The report recommended reforming fertiliser subsidies to ensure they are efficient and transparent, and targeting smallholder farmers to restore productivity.

“Establish structured commodities trading to minimise inefficiencies and transform smallholder farmers from subsistence into successful agribusinesses. Invest in irrigation to reduce productivity shocks and raise the sector’s total factor productivity, potentially climate proofing the sector,” the report recommended.

The report also stated that there should be support for stronger farmer organisations to foster economic inclusion of smallholders and increase their market power, thereby raising their incomes and productivity.

“Further, while value addition to agricultural commodities remains low, increasing the agribusiness to agriculture ratio could create more jobs and reduce poverty,” the report stated.