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Kenya Seed contract throws large-scale growers a lifeline

FINANCIAL STANDARD
By Hezron Ochiel | March 3rd 2015

Tens of thousands of farmers have been left holding sorghum which they are struggling sell after their contracts with East African Breweries Ltd (EABL) were terminated.

But they may get a lifeline after the Kenya Seed Company contracted some of them to grow sorghum seeds for the next season. However, most of the farmers contracted to grow the sorghum seeds are large-scale farmers who had been contracted by EABL to grow the crop for the manufacture of beer.

The brewer has drastically cut back on the amount of sorghum it buys after a 50 per cent tax on sorghum-based beer led to a steep decline in sales.

“Many farmers have delivered sorghum to collection stores and it is still holed up there. We still hope it will be bought so we can get back the money we invested. For now, however, we are happy with Kenya Seed’s intervention,” said Octave Ayieko, a sorghum farmer based in Kendu Bay, Homa Bay County.

Those contracted to grow seed crop have already planted the sorghum varieties Seredo and Gadam.

In an email response on EABL’s contract with sorghum farmers, Lawrence Maina, who is the general manager of the brewer’s subsidiary, East African Maltings Ltd, said: “EAML bought the sorghum it had contracted and skipped the October planting season to manage the low demand. We will continue purchasing sorghum as dictated by the demand.”

Little consolation

But this assurance offers smallholder farmers who will not benefit from the Kenya Seed deal little consolation.

Alice Achieng’ said she scaled up her sorghum crop acreage when she got the EABL deal three years ago.

She farms in Pap Nyadiel village, Siaya County, a region where climate change has made it difficult for other crops to survive. Ms Achieng’ felt safe with sorghum, which is drought resistant.

“In the past, I planted local varieties of the crop on a small scale and often produced more than enough for my family’s consumption. I sold the excess in the market,” she said.

“When EABL came along, I increased my production. But now, I cannot find a market for my produce and will have to scale back.”

Three years ago, the dream of commercialising sorghum became a reality when Achieng’, along with other farmers in the region, were approached by EABL.

“They instructed us to grow a better, high-yielding variety that would take two months to mature compared to the local variety that took three months,” she said.

“Once the crop was ready, they said they would buy it at a better price than we were being offered by middlemen. We liked the idea and started growing the variety.”

Prompt payment

During the first harvest, Achieng’ said she sold the crop to the brewer at Sh24 per kilogramme. Farmers were paid promptly, which encouraged them to boost production.

Between 2012 and 2013, farmers tripled their production to take advantage of the readily available market.

But things went awry when the market started shrinking in late 2013.

“I produced 14 bags of the commodity just when demand was starting to slow down. I was able to sell only three bags to the brewer, with the rest sold in the local market at nearly throwaway prices,” said Richard Oloo, another farmer in Siaya.

He, like Achieng’, took up sorghum farming because of its drought tolerance and fast maturity.

“The challenge was that the new variety was liked by birds. There were times between flowering and harvesting that we would spend the entire day on the farm scaring birds away,” Mr Oloo said.

With hopes of finding a more reliable market this season fast dwindling, Achieng’ and Oloo are finding it hard to sustain production of the crop, and have begun growing maize, beans and bananas. However, the weather does not favour high yields from such crops.

“We have little choice but to scale down production of sorghum, even though my earlier plan had been to put my entire farm under the crop,” said Oloo.

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