Keep livestock, talk to us for money

The livestock industry, particularly in the arid and semi-arid lands, has a huge potential, yet farmers get little support.

From the success stories of countries such as Botswana, this sector can transform the lives of millions of farmers and grow Kenya’s economy. Kenya Commercial Bank Foundation manager Rachel Gathoni spoke to Seeds of Gold about what needs to be done to uplift the industry.

Q: The portion of Kenya’s semi-arid land is far bigger than the arable part, yet crop farming tends to hog all the attention and investment. What stands in the way of a vibrant beef industry in Kenya?
Let me start by saying that with devolution, the tide is set to change as county governments are heavily investing in the sector. To your question, I shall take you back to Session Paper No 10 of 1965 titled ‘Provincial Balance and Social Inertia’ that stated: “One of our problems is to decide how much priority we should give in investing in less developed provinces.

To make the economy grow as fast as possible, development money should be invested where it will yield the largest increase in net output. This approach will clearly favour the development of areas having abundant natural resources, good land and rainfall, transport and power facilities, and people receptive to and active in development.”

The government, therefore, heavily used this model to effect development. Investments were pumped in the highland agriculture, dairy and you remember the cash-crops drive. For that, we have very successful dairy and tea sectors. The arid and semi-arid lands were ignored.
The poor infrastructure in the areas with vast land masses and drought compounded the marginalisation. If the government was not in, then of course private sector money was also missing, hence the lacklustre performance.
Q: What is the potential of Kenya’s beef industry?
The livestock sector contributes 10 to 15 per cent of the gross domestic product. The arid and semi-arid lands occupy 89 per cent of our land mass and are home to 70 per cent of the national livestock herd.

According to the Kenya Livestock study (2006), the sector employs 50 per cent of the agricultural labour. Given that this sector has been marginalised and underperforming, and that Kenya is a meat deficit country, (an estimated two million cattle are imported into the country annually), the sector has the potential to create jobs and transform arid and semi-arid land economies into engines of growth for the country.
Q: What needs to be done?

A lot, but infrastructure development to open up the arid and semi-arid lands to enable private sector investment lies at the heart of this. The national and county governments have a major role to play, in addition to security, drought management and animal disease control.

Further, livestock keepers need to form cooperatives to aggregate produce and inputs, and to negotiate better prices and ease access to extension services. Access to appropriate financial products and services that integrate socio-cultural perspectives shall increase uptake and enhance financial inclusion.
Q: So where do you come in as a foundation?
We have launched ‘Mifugo ni Biashara’ programme in partnership with the County Government of Baringo and 50,000 farmers to commercialise the livestock sector and increase incomes from milk and animal sales.

The programme shall focus on market access, farmers’ organisations, access to feeds, health services, including vaccination, improved breeds, financial services and value addition. So far, an artificial insemination centre has been launched and further issuance of Sahiwal bulls and Galla goats on loan has commenced.

We are finalising commercial fodder production and financing of milk dispensing equipment for cooperatives. The overall goal of this programme is to increase income from livestock sales by 50 per cent and to increase milk productivity by 400 per cent.

The programme shall provide interest-free loans to participating cooperatives and member farmers in the county.

Q: Under this programme, farmers who hold no title to their land will access loans from the foundation. How will this be possible?
The key to getting the loans is to belong to a cooperative. The members shall guarantee each other.
Q: How will you ensure repayment?

We are organising the farmers into cooperatives to aggregate produce and channel payment. If a farmer has a loan, deductions shall be made against their produce deliveries.

Q: How do small-holders with three or four head of cattle benefit?

I would advise such farmers to join a cooperative society because collectively with other small-holders, they shall form a herd. With large numbers, economies of scale are achieved when purchasing inputs, accessing extension services and more importantly, negotiating market price.

Often, the lone farmer is at the mercy of middlemen, who buy their animals or produce for a song. More vibrant cooperatives also have farmers’ days where members get to meet and learn from each other and from experts.
But where is the market?

There is money to be made locally. Kenya is a net importer of red meat. And with the growing middle class, there is a rise in demand for red meat and the high-end consumers are demanding choice cuts, providing an opportunity for producers of quality animals (young and well-marbled) to make money.

If we look at the Middle East where they want beef products from animals which have not been fed with ruminant meat and bone meal and not treated with growth hormones, you find that we have boundless opportunities. Then we have countries like Mauritius.

Actually, the global demand for red meat is higher than the supply, so the potential is huge.
What are the requirements for export market?

One must ensure they sell young tender animals that meet the export quality.