Corporate

Debts, middlemen, cheap imports bring Ahero rice scheme to its knees

Women harvest rice in Ahero. Farmers have been incurring huge losses as arrears paid to them end up in the pockets of unscrupulous brokers. PHOTO | FILE
Women harvest rice in Ahero. Farmers have been incurring huge losses as arrears paid to them end up in the pockets of unscrupulous brokers. PHOTO | FILE 

Debts running into millions of shillings, exploitation and import of cheap produce have brought the once vibrant Ahero Irrigation Scheme in Kisumu County to its knees.

The rice irrigation scheme, one of the largest in the country, is now a pale shadow of its former self due to alleged looting of farmers’ millions of shillings by middle men, poor farming methods and falling prices.

In the past two years, farmers have been running into huge losses as arrears paid to them end up in the pockets of unscrupulous brokers. Most of the farms have been turned into grazing fields as farmers abandon rice for other crops like tomatoes and sorghum.

Area MP Fred Outa yesterday said the scheme ran into trouble in early 2000 when local leaders began politicising the project.

Mr Outa, the Nyando MP, said matters have been worsened by the accumulation of loans advanced to farmers, an amount which runs into hundreds of millions of shillings.

“I have been a rice farmer for some time now and what I can attest to is that the scheme needs an urgent and swift recovery plan. Since I became an MP I have tried but a lot still needs to be done,” he said . Bernard Ogallo, a farmer at the scheme, said the crop had become “a bitter pill” following the entry of cheaper imports which edged out locals from the market. As a result, falling and unpredictable prices now threaten the multi-million shillings scheme which has been a source of livelihood for households in western Kenya and beyond.

“Farming rice is no longer lucrative. We spent a lot of money and resources on farming with little or no returns at all,” he said. 

So dire is the situation, he said, that the farmers wrote a memorandum to Kisumu governor Jack Ranguma indicating that they were unable to account for about Sh70 million paid to the scheme.

Negotiating a bailout

“We are surprised that money paid to the scheme cannot be reflected in our audited reports,” they say in the June 2015 letter signed by Mr Alphonce Oruko, one of the scheme directors.

Mr Ranguma said he has been  negotiating a bailout with the national government. The governor, who yesterday launched tractors to be used in ploughing farms, also blamed ‘‘local politics’’ for stalling efforts by the county government to revive the scheme.

“Agriculture, according to the Constitution, is a devolved function and as a count we are working around the clock to revive the scheme,” said the governor. “We have already developed a better marketing framework with the help of the Nairobi Securities Exchange, among other initiatives.”