It’s time to kill cartels in agriculture

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BY MACHEL WAIKENDA

According to the Kenya National Bureau of Statistics, agriculture contributed to 24 percent of the GDP in 2011, which has been on the same level over the years. According to the KNBS 2012 data, agriculture is the number three-employment sector in the country.

Kenya has about 20 percent of arable land but currently only eight percent of the country’s land is being used for agriculture production. More land can be put under irrigation and the country can invest more in greenhouses but cartels in the various sub-sectors are making it difficult for farmers to invest heavily.

Agriculture has the potential to not only grow the economy, but also create a large number of jobs than any other sector. With more young people participating in the agricultural sector, the country can have more food making life more affordable for millions of Kenyans.

Cartels have infested the tea, coffee, sugar, maize and milk subsectors in a big way making it difficult to control access to markets for farmers. These subsectors require huge investment and it is not right for a few individuals to take advantage of this.

Middlemen have been involved in hoarding agricultural produce in the past and in the process making it difficult for farmers to make money out of their hard work. Some have even taken it to the level of controlling farm inputs making it even more expensive to make sustainable investments in the country.

As the government implements its plans such as ensuring that one million acres of land is under agriculture by 2017, it must also look into ways of ensuring that farmers and especially young farmers make most out of their investments.

Cartels, which have been fixing prices for some of Kenya’s agricultural produce, have made it their business to kill various industries. By ensuring that there are high tariffs, the cartels have managed to drive farmers away from the commercially viable sub-sectors for selfish control.

The Agriculture Cabinet Secretary must lead the parastatals under the ministry in slaying cartels by upholding transparency and accountability in their operations. Cartels world over are a creation of the people and as a people are the ones who give them room.

The issue of who knows who in the agriculture sector must be stopped and the CEOs of the parastatals must work hard to kill those cartels in their institutions. Groups of individuals who are out to make a quick kill and control pricing must be dismantled under all costs.

Pig farmers have in the recent months complained of groups of individuals who are forming who have formed “pork eating groups” and selling at throwaway prices, which has distorted the market. Farmers say that communal pork eating groups have distorted their business as these groups have fixed prices at Sh240 per kilo instead of the earlier Sh320.

This must not be allowed to happen, as the country wants to see more investments in agriculture especially by the youth. Farmers must be allowed to make maximum earnings from their investment especially given increased production and rearing costs.

Farmers must be encouraged to form producers’ associations to take care of their interests and ensure that such individuals as those who are trying to control the pig sub-sector do not exploit them.

There must also be increased efforts to bring an end to the controversial coffee auction and send packing cartels that have thrived at the expense of coffee farmers over the years. Coffee producers must identify centralization of the coffee produced in every county, processing, value addition and subsequent marketing as the ultimate solution to increase earnings for farmers.

In the sugar industry, efforts must be made to ensure that licenses issued to suspect corporate organizations or individuals are revoked and the individuals or organizations indicted and eventual banned from transacting business in the sector. The government must double efforts to end sugarcane poaching as the smuggling of cheap sugar into the country is hurting the industry.

The government must also ensure that it deals with cartels that have often created artificial sugar shortages and manipulate the price of the precious commodity and reap super profits. This has also been seen in other sectors such as maize and fertilizer.

Government must establish why a 50kg bag of fertilizer retails at around Sh2,500 in some parts of the country, the same product sells for Sh6,000 in other areas. There is no reason that the same product should have such a big difference in pricing in the same country.

It is obvious that these fluctuations in prices are artificial and driven by a few individuals as a way of making billions in profits at the expense of farmers who experience higher production costs. The same farmers are then exploited by more cartels as they search for markets leaving them with meager earnings.

It is obvious that young people are observing these developments and will shy away from investing in agriculture if they are not making money. In order to assist them, the government must ensure that these cartels are dealt with immediately.

More agricultural investment will raise production and ensure that Kenyan not only becomes self-sustaining in the food sector but also a major exporter of agricultural and livestock products across the region and beyond.

(The writer is a Political and Communications consultant. Twitter @MachelWaikenda)

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  • peter

    very well said.

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