Macadamia processors want Sh20m fine for nut smugglers

Macadamia processors are lobbying for an amendment of the Crops Act, to review the current maximum penalty of up to Sh5 million in fines for smugglers caught trading in the product to Sh20 million.

The push for the tougher rule surfaced during an intense inaugural stakeholder's forum held in Mombasa over the weekend.

According to the existing Crops Act, smugglers are liable to a maximum of three years imprisonment term and a maximum Sh5 million in fines.

However, local processors are of the view that the current penalties are not sufficient enough to deter foreign rogue entrepreneurs who have been capitalising on the 'lenient' penalties at the expense of growth in the local industry.

They argue that traders find it easy to risk a Sh5 million fine for smuggling high value, unprocessed macadamia nuts.

Chinese operators have been accused of working with unscrupulous local agents in illegally acquiring raw macadamia produce, which they smuggle to international markets at premium prices at the expense of local farmers who are paid a paltry sum.

Under Kenyan law, only processed macadamia products are allowed to be exported, a deliberate policy measure meant to spur growth of local industries.

According to the Nuts Processors Association of Kenya (NPAK), the rogue Chinese operators often transport the product abroad through an organised system involving false cargo declaration and re-entering goods from neighbouring Tanzania as ' in-transit' cargo.

NPAK Chairman Johnson Muhar revealed that Shimoni port in south coast, Taveta and Namanga border crossings are areas mostly used by the smugglers.

According the Association's Secretary General Patrick Wainaina, the current Sh5 million fine is modest and has not helped stop the vice.

Peanuts for produce

Reacting to the concerns raised, the interim head of the Nuts and Oils Crops (NOC) directorate, Raymond Kahindi, said the views expressed will be taken into account, but reckoned that the implementation of the existing legal instrument has yet to be analysed.

"That's a legal issue that will be processed but it's important we see what the challenges are since the new law was recently introduced (August)," he said.

Meanwhile industry players agreed to increase the farm gate price for cashew nuts to Sh50 per kilogramme from Sh46.

Being the first forum of edible oils stakeholders since the introduction of the NOC directorate, farmers complained about low earnings as a result of proliferation of brokers who pay them peanuts for their produce.