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NCPB warehouse receipts plan to cut farmers’ losses

Andrew Tuimur
Chief Administrative Secretary, Ministry for Agriculture and Irrigation Andrew Tuimur during a December 6 parliamentary meeting in Nairobi . PHOTO | JEFF ANGOTE  

The Ministry of Agriculture will soon roll out Warehouse Receipting System (WRS) after the Bill establishing it was signed into law.

Chief Administrative Secretary in the Ministry of Agriculture Andrew Tuimur said farmers will benefit from the system as they will no longer be under the mercies of cartels who offer rock-bottom prices.

In June, President Uhuru Kenyatta assented to the Warehouse Receipt System Bill paving the way for the commodity exchange for trading agricultural produce.

“We want to rollout WRS as soon as this year,” Dr Tuimur told the Business Daily during an interview last week.

He added that farmers will be able to deposit grain at the National Cereals and Produce Board (NCPB) depots for storage, then sell once the price has stabilised.

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This, argued Dr Tuimur, will prevent farmers selling in a rush when the market is flooded, making them victims of low market prices.

He said the private sector will also be incorporated at a later date where they will be licenced and allowed to trade with farmers.

This is not the first time the government will be trying to establish the WRS. In 2010, the same system was started by NCPB but farmers failed to embrace it.

Dr Tuimur said farmers who would have deposited maize in the warehouse will access credit against issued receipts.

An estimated 80 percent of Kenya’s population lives in rural areas and mainly depends on small-scale agriculture for food and income.

Farmers are currently harvesting the main season crop but NCPB is yet to open its door for purchases. Strategic Food Reserve, a State agency mandated with buying grain, said it will not set the price this year.

“This warehouse receipt system paves the way for a national commodity exchange making it possible to trade in agricultural commodities, an important development that will see further improvement of profitability, liquidity and price stability in the trade of agricultural commodities,” said economist Toni Watima.

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