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Wheat farming on the ebb as cost burden bites

By | Updated Sat, May 28th 2011 at 00:00 GMT +3

By KIPCHUMBA KEMEI

Wheat farming in Narok has turned into an expensive venture, forcing many farmers to opt out of the once lucrative venture.

The activity, which was highly rewarding in the 1990s, is now in the hands of few large-scale farmers.

And because of economies of scale, farmers who used to till less than 100 acres of land have quit the venture.

Most local farmers under this bracket are renting their land to outsiders, with some being employed as watchmen in their own farms.

As it is, the crumbs of bread from the vast wheat farms never trickle down to tables of the poor landowners who rent out their farms.

While rich growers harvest tons of the crop and reap benefits, peasants on whose land the crop grows are spectators in the multi-million shilling sector.

Minimum returns

"We annually rent out our land, spend the money and return to provide casual labour on the wheat farms," says John Koini, a farmer from the Nkorinkori wheat belt.

Local Agricultural Officer Maurice Suji says the acreage under the crop increased from 45,000 in 2005 to 120,000 hectares harvested last season, with farmers, mostly outsiders, raking in Sh7.6 billion in five years.

"Before the venture became unprofitable, stakeholders and bankers exchanged Sh300 million every two weeks. Every body including brokers, corporate buyers and the residents used to benefit," says Koini.

He says most farmers opted out because of the financial burden, adding that when financial institutions, including the Agricultural Finance Corporation auctioned their property because of failure to service their loans after successive years of crop failure, a big blow was dealt on the future of the venture.

"The rain started beating farmers when the cost of farm inputs rose sharply and because of cheap grain imports. Whenever we prepared for harvests, cheap imports flooded the market, bringing the prices of wheat down," says David Mpatiany, the chairman of Narok Wheat Farmers Association.

He adds that while growers harvest tons of the crop, peasants on whose land the crop grows are mere spectators. He wants the Government to bring back the Guaranteed Minimum Return.

The scheme, he says, used to cushion farmers in the event of crop failure. It acted like an insurance scheme.

In the last three years, farmers resorted to protests to force the Government to stabilise wheat prices by blocking cheap imports.

"There is nothing to show for the rent they get from tenants. It is a sad situation because after spending the money, they go back and get employed as watchmen, milkmen and drivers," says David ole Kosen of Nkareta wheat field, a father of 14.

Landlords rent their farms at low prices of between Sh4,000 and Sh6,000 an acre per year. A harvest of 20 bags per acre fetches about Sh85,000 when the product is sold to millers.

Sector stakeholders

Farmers spend between Sh4,500 and Sh5,500 to plough an acre of land apart from getting seeds, spraying, weeding and harvesting.

Their woes are worsened by threats of diseases like stem rust and the lack of lobby groups to fight for better prices.

This is unlike large-scale farmers who have their own lobby, Cereal Growers Association.

Few banks are willing to provide credit to small-scale farmers.

There have been cases where farmers’ land and property have been auctioned to recover loans, leaving them poor and vulnerable.

Narok North MP and Heritage Minister William Ntimama, who is a large scale wheat and barley farmer in the Mau Zone, says small scale farmers who plough up to 100 acres should be cushioned to allow them stay afloat. He says they should be assisted by bringing down the cost of farming.

The farmers have also claimed pesticides used over the years to fight stem rust were having negative effects on the soil. "Five years of pesticides application will leave our farms barren.

Ntimama adds that it is sad that while large-scale farmers have organised marketing strategies that ensure they maximise profit, small-scale farmers are at the mercy of middlemen, brokers and exploitative millers, who buy wheat at the lowest prices possible.

They argue that the disparity between them and big farmers is huge, saying the State should lower duty on farm inputs to forestall cases where small-scale farmers are quitting the venture.

In Narok North and South, large-scale farms are found at Nkorinkori, Lemek, Nkareta, Katakala, Mau, Melili, Olchoro, Ntulele and Nairekia-Enkare.

"We are staring at loses following an imminent crop failure. Some farmers have left after allowing cattle to graze in the wheat fields," says Mr Jacob Korir, an Eldoret-based farmer.

Farmers are keenly watching if the new initiative unveiled by the National Cereals and Produce Board last year dubbed Warehouse Receipting will succeed.

The scheme allows farmers to store their grains at NCPB silos and are issued with receipts that act as collaterals.

"We started the pilot project with maize and if it succeeds, all grain farmers will be brought on board. Farmers will be forced to pay for the storage, then issued with receipts that will allow them to walk to the banks and other financial institutions to access credit facilities for seed bed preparations," says Jimnah Mbaru, the board chairman.

Farmers, he says, will sell their grains when prices in the markets improve, saying the scheme has the blessing of the Government and other stakeholders including millers.

Mbaru says in future, the board will introduce another scheme known as Commodity Exchange, where farmers will trade with their harvests, the way the Nairobi Stock Exchange operates.


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