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Uasin Gishu embraces cooperatives to end exploitation of farmers

Sawmilling

Uasin Gishu governor Jackson Mandago flags off a tractor bought by a group of farmers at Oleinguse, Kesses Constituency on May 12, 2021. NMG PHOTO

Summary

  • Cooperative societies are becoming an alternative market for most residents of Uasin Gishu as they substitute their sources of income.
  • Since 2015, farmers have embraced them for the sake of value addition, leading to the number of cooperatives to drastically increase to over 350 with the devolved unit sfunding majority of them.
  • The county has loaned over a half a billion shilling to over 180 cooperative societies for the last six years in a move aimed at empowering locals.

Cooperative societies are becoming an alternative market for most residents of Uasin Gishu as they substitute their sources of income.

Since 2015, farmers have embraced them for the sake of value addition, leading to the number of cooperatives to drastically increase to over 350 with the devolved unit funding majority of them.

The county has loaned over a half a billion shilling to over 180 cooperative societies for the last six years in a move aimed at empowering locals.

“Our loan portfolio is Sh501 million to around 180 cooperatives. Repayment has been well until the onset Covid-19. But we are at 75 percent. We have some few cooperatives which have challenges in repaying their loans,” said Uasin Gishu County Executive of Cooperatives and Enterprise Esther Mutai.

For instance, cereal farmers are set to complete their multimillion-shilling maize milling plant, giving them a competitive edge in the liberalised market.

To qualify for a loan from the county government, farmers were forced to come up with Moi-Soy Cooperative Union to secure Sh230 million, almost a half of the total cost of the project which is at Sh477 million.

According to Moi-Soy Union chairperson Moses Tenai, they have started installing machines and anticipate that it will be ready by March 2022.

He said that opted to set up the their own milling plant is to cushion them against perennial problems facing the maize sector.

new reforms

The cooperative will give the grain growers an opportunity to take charge of their produce rather than leaving everything to the national government which they slammed for continuing to neglect the maize sector.

“I have urged members of Moi-Soy Cooperative that they should not reduce the acreage under maize production because our plant will commence milling six months from now and with the new reforms in the sector, we will gain a lot because prices in the liberalised market will be determined by supply and demand forces,” explained Mr Tenai.

The plant will produce around 500 tonnes of maize flour in a day.

According to Ms Mutai, the county had pumped in Sh230 million in the project and the remaining Sh247million was contributed by the members themselves.

Uasin Gishu is banking on the plant to bring to an end the woes facing farmers with plans to use one of the farmers’ cooperatives to import maize from neighbouring countries for milling to curb the market being flooded.

“What weakens prices for our local produce in the market is maize from neighbouring countries but when counties import the maize from those countries through the farmers’ cooperatives, those countries will cease to bring the produce into the country individually. Our market will remain stable because the imports will supplement local produce which our farmers will be milling,” disclosed Ms Mutai.

And it’s not only maize farmers that are taking advantage of cooperatives. Fifty two elders from Olenguse location pulled resources contributing Sh200 each for a merry-go-round and to come up with their own cooperative which they say has empowered themselves.

The objective of the group was to venture into a long-term programme beyond the saw milling business to tackle high poverty and unemployment level.

“Lack of capital to set up the business was our main hurdle and we had to approach a financer (Governor Jackson Mandago) to boost us through but he insisted that his administration could only give out loan to a registered business body and that is how we conceptualised the idea of the cooperative society,” Julius Sirma, chairperson of Olendu Elders Cooperative said adding that they raises Sh20,000 for registration in 2016.

Startup capital

Armed with the cooperative registration certificate, the elders made a second attempt to the county administration which turned out to be successful.

They secured a Sh2.5 million loan as a startup capital for their timber business considering that there was ready raw materials- logs from the expansive Ceng’alo Forest and other private commercial farm forestry to sustain their saw milling operations.

“Out of the Sh2.5 million, we used Sh1.7 million to purchase wood mizer for splitting of logs since we had the structure ready, and Sh300,000 for electricity connection while the remaining amount went to other operational costs,” Mr Sirma explained.

To expand the membership and capital base, the elders invited their spouses to join at a fee bringing the total members of the group to 104.

“The registration fee for membership is Sh1,100 and to be a shareholder one has to pay Sh10,000 of which only 40 members have qualified,” he said.

The business came in handy for the cooperative when there was high demand for timber products in the construction sector due to the government moratorium on logging activities in public forests.

“As the business expanded, owing to the high demand of timber and timber products, we diversified to other income generating activities like afforestation programmes- tree nurseries to help boost the country’s forest cover,” said Mr Sirma.

To cut down on high operational cost, the elders have pumped Sh5 million to purchase a tractor to ease transport when sourcing for the logs from private farms.

Immediate payments

“When we cleared our Sh3 million loan, we secured another Sh5 million from the county cooperative department which we used to buy a tractor to ease our work,” he said.

For dairy cooperatives like Bronjo which had collapsed, had it not for the county government, it could not have been revived.

After receiving a milk plant cooler from Kenya Dairy Board (KDB), the cooperative secured a Sh1 million loan from the county government which it were using to buy milk from local farmers and pay them immediately instead of waiting for days.

Mr John Arusei, the current chairman of the cooperative together with eight colleagues who were part of the then self help group said the farmers could not find a better market for their milk without having a functional cooperative.

Increased production

The nine officials of the Bronjo Dairies Cooperative Society, decided to marshal around 80 farmers to be members with a registration of Sh1,000.

He said when they started collecting milk last year, they would get 83 litres a day but the volume has since increased to 400 litres a day.

“Last year we brainstormed over how this cooperative could be revived since our farmers were suffering in the hands of middlemen. The push was the need to get a better market for our milk since this area mainly focuses on milk production,” he said.

Governor Jackson Mandago said that his administration will continue to channel funds to cooperatives to empower residents.

“The reason why I love cooperative societies and my administration is committed to continuous support is because it is a move which empowers members directly compared to these other ventures,” said Mr Mandago.

He also challenged the cooperative movements within the county to play a vital role in conserving the environment by ensuring that trees are planted at the grassroots.

“In your cooperative movements individually, in the issue of environment we appeal to you to ensure that you contribute towards it in rural set ups so that the environment is conversed, many trees as possible should be planted,” said the county chief.

He warned the Cooperatives against misusing funds given to them by the developed unit.

“Please ensure that you manage the cooperatives in a transparent way, officials must continue to be accountable and members have to be disciplined and responsible by servicing loans we have given to you,” he said.

“When you repay the loan which we give you at 5 percent interest rate, it increases the loan limit while enabling others to get it too but we cannot give you funds to go and misuse.”

Mr Mandago further added that his administration will continue to channel funds to cooperatives in order to empower many residents hence making them independent.

“The main reason why I love cooperative societies and my administration is committed to continuous support is because it is a move which empowers members directly compared to these other ventures,” said Governor Mandago.

Environmental conservation

He also called upon the cooperative moments within the county to play a vital role in conserving the environment by ensuring that trees are planted at the grassroots.

“In your cooperative movements individually, in the issue of environment we appeal to you to ensure that you contribute towards it in rural set ups so that the environment is conversed, trees to be planted as many as possible,” said the county chief.

According to Kenya Farmers Association director Kipkorir Menjo, if the government helps farmers to revive the stalled Cooperative Societies, it will give cereal growers opportunities to benefit from the newly announced reforms by Agriculture Cabinet secretary Peter Munya which is aimed at creating an enabling environment.

He also urged the existing Cooperatives to come up with more storage facilities and urged also the government to continue with zero tax on construction of such facilities.

“With the new reforms, Cooperatives will give our farmers an opportunity to influence the supply and demand of the liberalized market and it will help better their investment in maize production. However, there is need of them to be transparent in their activities,” said Mr Menjo