Right to lift ban on macadamia exports

In Summary

• The local price of raw macadamia nits had fallen to Sh20 per kilo compared to a world price of at least Sh500.

• A ban on the export of raw nuts has been in place since 2015

Trade CS Moses Kuria has rightly suspended the 2015 ban on the export of raw macadamia nuts. The price of raw macadamia in Kenya had dropped to around Sh20 compared to a world price of at least Sh500.

The 2015 ban also blocked the export of cashew and pyrethrum whose local prices have also fallen as a result.

The export ban is based on the misconception that local value-added will increase the price paid to the Kenya farmer.

But the local market is just too small to absorb all the macadamia nuts produced here. Processed macadamia nuts are on sale in Kenya at Sh950 for 250g but the price for the farmer has not improved.

In theory, it would be wonderful to export only processed agricultural products. But in reality, a lot of the international price increase is taken by the supermarket (around half the sale price), packaging, branding, and marketing.

In reality it is difficult for the farmer of any export crop such as coffee to get more than 20 percent of the world price. But that would be at least Sh100 for a kilo of macadamia nuts, five times the measly Sh20 being paid at present.

Quote of  the day: "There are many ways of going forward, but only one way of standing still."

Franklin D. Roosevelt
The US President died on April 18, 1945

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