Ministry requests for Sh1b to actualise warehouse receipt system

The Ministry of Agriculture and Livestock Development has requested more than Sh1 billion from the National Treasury to operationalize the warehouse receipt system.

This is in preparation of an anticipated bumper harvest from farmers in October, hence the need to operationalise the system to prevent loss of produce.

Speaking during the opening of the third National Agriculture Summit in Nairobi, Agriculture Cabinet Secretary Mithika Linturi confirmed that his Ministry had made the request.

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"I have asked for more than a Sh1 billion from the National Treasury. However realising how our fiscal space is, it is not a guarantee that it is the money I will get. Once the Ministry gets the money, we will act accordingly," said Linturi.

The warehouse receipt system is an electronic system that allows farmers deposit commodities in certified warehouses belonging to National Cereals and Produce Board (NCPB). The produce is tested, cleaned, graded and stored after which the owners of the produce receive a receipt of proof of ownership.

This gives farmers opportunities to reduce post-harvest losses and sell their produce when prices are favourable.

"Our aflatoxin testing labs must be up and running so that by the time we are harvesting, within the 30 warehouses, we are able to operationalise the warehouse receipt system," Linturi said.

On his part, Agriculture Sector Network (ASNET) Chairman, Dr Bimal Kantaria urged the government to ease regulations that hamper the uptake of subsidised fertiliser.

"There is about 8,000 agro-dealers who are doing nothing because the government's distribution network is to Kenya National Trading Corporation and NCPB and we are hoping through the e-voucher system, that agro-dealers will be allowed back into the distribution network," said Kantaria.

Kenya Private Sector Alliance (KEPSA) Deputy Chief Executive Officer Victor Ogalo said in the last three and a half years, Kenya has used over Sh600 billion in the importation of food, money which can be used to revive the sector and produce more food.

"It is sad that 60 years after independence Kenya is still unable to produce enough food for its people and instead rely on imports," Ogalo said.

Ogalo noted that in 2020, Kenya used Sh128 billion on food imports and in 2021, Sh155 billion was used. The amount rose to Sh184 billion in the year 2022 and by April 2023, the country had already used Sh201 billion on food imports.

According to Ogalo, the rise in the amount has been attributed to the drought that has affected the country in the past years.

"We can use that money to invigorate the agricultural system. Particularly last year and this year the main reason for the rise was drought, and every four to five years we have drought, we need to better organise ourselves so that we are not caught up in such situations," he said.

Ogalo added that 80 per cent of of the food consumed in Kenya is imported and the country produces less than 15 per cent.

"Nairobi as a county buys about 97 per cent of the imported food. So it is a grave matter, let us come up with tangible solutions for Kenya to have opportunities to produce more food," said Ogalo.

The two-day summit under the theme Leaving no one behind For Food and Nutrition Security and Agriculture Competitiveness, organised by Agriculture Sector Network (ASNET), Kenya Private Sector Alliance (KEPSA) and the Ministry of Agriculture brings together stakeholders in the private and public sector.