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Kenya: Contract Farming to the Rescue of Farmers

Kenya: Contract Farming to the Rescue of Farmers

Write: Ambar [2011-05-20]

Contract farming is the likely saviour of Kenya's cotton farmers, as it would help reduce losses they face every season due to unfair pricing, Nyanza Provincial Director of Agriculture, Jacob Odondi said.

Prospects for reviving industry seem encouraging but marketing suffers due to lack of a regulatory body to oversee day-to-day operations of industry.

Revival of cotton industry is well on course, he contends.

Odondi says that liberalised system pose a threats to growers as unscrupulous dealers would buy their produce cheap and themselves earn handsome profits.

Farmers should sign contracts with various ginneries which dispaly pricing and reduce risks as they were legally covered, he said.

Government support in the form of provision of seeds and extension services to meet its quota under Africa Growth and Opportunity Act (Agoa) is in place.

Farmers have now to seize opportunity and produce as much as they can, viewed Odondi.

Government has allocated Sh250 million this financial year to revive cotton industry countrywide emphasising on provision of technical advice and certified seeds.

US Commerce Department statistics showed entry of Asian countries into competition for US textile market had cut gains made by Kenya and the US in narrowing trade deficit between them.

Kenya's textile and apparel sales to the US under Agoa fell from Sh19.5 billion ($272 million) in 2004 to Sh19.2 billion ($267 million) in 2005.

This slump could dampen hopes Kenya had when it registered a steady increase in clothing exports to the US after Agoa's implementation in 2001.

Inefficiency among African producers, including Kenya, has been blamed for decline with efficient Asian exporters taking advantage to sell unlimited quantities of textiles and apparels on the US market.