This archive report was first published on 15 January 2020.
President Uhuru Kenyatta's recent reforms in the agriculture sector have been met with cautious optimism by industry players.
The reforms, which include policy changes and injections of funds into tea, coffee, milk, and rice farming, aim to address the long-standing issues affecting farmers.
According to a report by McKinsey, the government has been running the sector without any reference to numbers, either on productivity or consumption.
As a result, cartels have been able to operate with impunity, frustrating both producers and consumers.
President Kenyatta has directed law enforcement officers to break these cartels and confront them with every instrument available.
He also directed the Competition Authority to end the practice of brokers and middlemen taking a large share of farmers' earnings.
The President wants the Kenya Tea Development Agency (KTDA) to pay farmers not less than 50% of their deliveries as monthly payments, with the balance being paid as an annual bonus.
He also wants the newly developed Tea Regulations (2019) gazetted within the next two weeks to pave the way for value addition before exportation of the produce.
The regulations include the establishment of a committee to determine the formula for pricing green leaf and the formation of a self-sustaining stabilisation fund to ensure implementation of guaranteed minimum returns.
Additionally, the President wants the National Treasury to operationalise the Sh3 billion Cherry Revolving Fund within the next 30 days to cushion farmers from delayed coffee payments.
Industry players have welcomed the reforms, with some calling for speedy implementation of the directives.
