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Economy

Wheat farmers locked in row with millers over imports

Wheat farmers at work: Kenya imports up to 75 per cent of the grain. PHOTO | FILE
Wheat farmers at work: Kenya imports up to 75 per cent of the grain. PHOTO | FILE 

Wheat farmers are locked in a row with millers whom the growers accuse of refusing to buy their produce in favour of imports.

The standoff has threatened production of the crop next season, which could result in a supply shortage.

The farmers are expected to meet in Eldoret today where they say they will “make a major announcement” on the future of the crop.

Hundreds of farmers from Rift Valley are stuck with over 250,000 bags of wheat from this season’s crop, as millers say their stores are full and cannot accommodate more.

Cereal Growers Association of Kenya chief executive officer Anthony Kioko says Wednesday’s meeting “will determine the future of wheat farming in the country.”

“Millers are no longer buying wheat from farmers and when you look at the imports, you realise that the bulk of goods coming in is wheat, this is the reason farmers are meeting today to discuss the way forward,” said Mr Kioko.

“The meeting is likely to shape the future of wheat farming in the country,” added Mr Kioko.

He said it will be impossible for farmers to go back to wheat farming next year when the current crop has not been purchased.

Millers on the other hand argue that high quantities of local wheat this year has created unusual pressure, making it difficult to accommodate all local produce.

“Due to the rains, local harvest is available sooner and in greater quantities than has been in the past, this is placing unusual pressure on the buying end of the value chain,” said chairman of the Cereal Millers Association Nick Hutchinson.

Import data from the Kenya Ports Authority indicates that direct discharge of wheat bulk through the conveyor belt accounted for 42,640 tonnes last week.

Local farmers have been fighting the imports noting that it affects the purchase of the local crop. The growers have in the past asked the State to compel millers to exhaust the local crop before importing.

Should farmers make good their threats, the move could see the country grapple with a deficit of wheat in the coming months, which may raise shelf prices.

Kenya is a net importer of wheat, producing 350,000 tonnes against an annual consumption of 900,000 tonnes.

Last month, Unga Ltd was buying a 90-kilogramme bag at Sh3,050 while Dola was offering Sh2,800, before halting the purchases. Farmers have considered this price to be way below production costs.

A report by the Ministry of Agriculture indicates the minimum cost of producing a bag of wheat in the North Rift is Sh3,200. This can rise to Sh3,400 in areas such as Narok.

Mr Kioko said the prices do not guarantee farmers a return on their investment as they are below the production cost.

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