A government ban on cashew nut exports has left farmers burdened with low prices following reduced interest in the crop by processors.
The growers have petitioned Agriculture minister William Ruto to rescind the ban, saying they would incur huge losses if they sold their yield at the current market price of Sh30 per kilogramme compared to Sh55 before the ban.
A group of farmers from Mpeketoni in Lamu District, a region known for its high quality nuts, wants Mr Ruto to lift the ban to cushion them against the huge losses they are set to incur.
“Over 200 tonnes of nuts are rotting on the farms with the situation expected to get worse as the peak season sets in. Farmers cannot sell their nuts at a throw away price,” Lake Kenyatta Farmers’ Co-operative Society chairman,Mr David Gikaru, said.
When the government effected the ban last year, exporters of raw cashew nuts moved to Mozambique and Tanzania, leaving only a handful of local processors in the market.
There are about four main processors focusing on the region who include Millennium Nut, Wonder Nut, Equatorial Nuts Processor, and Kenya Nuts Ltd. None of them, said Mr Gikaru, was offering competitive prices. Supporting the government’s move on the ban, Mr Johnson Muhara, the general manager of Equatorial Nuts located in Central Province, said the drop in farm gate prices was not unusual and that prices were expected to rise once more players emerge. “This is part of the teething problems the industry has to suffer before it eventually stabilises,” Mr Muhara said.
Companies exporting raw nuts, industry players said, were given high rebates by importing countries since the exports create jobs in the importing countries.
“Since importing countries have created huge markets for Kenyan nuts, which they cannot do without, they will have no alternative but to establish processing factories in here Kenya,” Mr Muhara said.
More players
He said the move would open up the industry to more players. It will also benefit the industry through technology transfer.
Mr Ruto slapped a ban on the export of raw cashew nuts to encourage local processing following recommendations by a taskforce chaired by former Bahari MP John Mumba.
A report by the taskforce was in favour of value addition through local processing of the nuts before export. Over 65 per cent of cashew nuts produced in the region have in the past been exported raw to China, Hong Kong and India. The task force also recommended that the National Cereals and Produce Board (NCBP) buys raw cashew nuts and sells them. “Initially, local government officials assured us that NCBP would purchase the crop from us, but almost seven months down the line and we are still waiting to receive them,” Mr Gakuru said, adding that the situation was getting worse.
Farm gate prices
The government’s participation through NCPB was intended to regulate the farm gate prices. Banning exports was also meant to harness enough produce for local processing which would also create employment.
“Cashew nut processing is labour intensive and thousands of jobs are lost every year as raw nut-in-shell is exported,” Kenya Nuts managing director Mbugua Ngugi recently said. (By GITHUA KIHARA and GALGALO BOCHA)
The growers have petitioned Agriculture minister William Ruto to rescind the ban, saying they would incur huge losses if they sold their yield at the current market price of Sh30 per kilogramme compared to Sh55 before the ban.
A group of farmers from Mpeketoni in Lamu District, a region known for its high quality nuts, wants Mr Ruto to lift the ban to cushion them against the huge losses they are set to incur.
“Over 200 tonnes of nuts are rotting on the farms with the situation expected to get worse as the peak season sets in. Farmers cannot sell their nuts at a throw away price,” Lake Kenyatta Farmers’ Co-operative Society chairman,Mr David Gikaru, said.
When the government effected the ban last year, exporters of raw cashew nuts moved to Mozambique and Tanzania, leaving only a handful of local processors in the market.
There are about four main processors focusing on the region who include Millennium Nut, Wonder Nut, Equatorial Nuts Processor, and Kenya Nuts Ltd. None of them, said Mr Gikaru, was offering competitive prices. Supporting the government’s move on the ban, Mr Johnson Muhara, the general manager of Equatorial Nuts located in Central Province, said the drop in farm gate prices was not unusual and that prices were expected to rise once more players emerge. “This is part of the teething problems the industry has to suffer before it eventually stabilises,” Mr Muhara said.
Companies exporting raw nuts, industry players said, were given high rebates by importing countries since the exports create jobs in the importing countries.
“Since importing countries have created huge markets for Kenyan nuts, which they cannot do without, they will have no alternative but to establish processing factories in here Kenya,” Mr Muhara said.
More players
He said the move would open up the industry to more players. It will also benefit the industry through technology transfer.
Mr Ruto slapped a ban on the export of raw cashew nuts to encourage local processing following recommendations by a taskforce chaired by former Bahari MP John Mumba.
A report by the taskforce was in favour of value addition through local processing of the nuts before export. Over 65 per cent of cashew nuts produced in the region have in the past been exported raw to China, Hong Kong and India. The task force also recommended that the National Cereals and Produce Board (NCBP) buys raw cashew nuts and sells them. “Initially, local government officials assured us that NCBP would purchase the crop from us, but almost seven months down the line and we are still waiting to receive them,” Mr Gakuru said, adding that the situation was getting worse.
Farm gate prices
The government’s participation through NCPB was intended to regulate the farm gate prices. Banning exports was also meant to harness enough produce for local processing which would also create employment.
“Cashew nut processing is labour intensive and thousands of jobs are lost every year as raw nut-in-shell is exported,” Kenya Nuts managing director Mbugua Ngugi recently said. (By GITHUA KIHARA and GALGALO BOCHA)
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