Officers inspect fertiliser in an Eldoret Depot.Storing grains in warehouses can help farmers access farm input and other expenses credit facilities. PHOTO BY BUSINESS DAILY.
Farmers storing maize and other grains in warehouses can access farm inputs and emergency credit facilities of more than 70 per cent against their cereal value from agro-dealers and banks.
Besides, the farmers would enjoy better prices of more than 40 per cent because of the delayed sale of the grains until prices are high.
It costs between Sh10 and Sh20 to store various grains in Eastern Africa Grain Council (EAGC) certified warehouses.
Maize producing farmers sell the grains between Sh1,800 and Sh2,100 especially during planting seasons to raise capital for the inputs. Others do the same to meet other demands like school fees.
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But delayed selling of maize can earn up to Sh3,000 or more given that after harvesting, losses result in a drop of the quality maize available for sale to millers and for local market consumption.
EAGC Executive Director Gerald Masila said farmers, who have organized themselves into groups, deliver grains to the organisation’s accredited 53 warehouses through 139 village aggregation centres (VACs) across East Africa.
Each of them is issued with a G-vouchers confirming the quality and quantity delivered. The vouchers can be used to access credit from appointed agro-dealers as well as partner financial institutions.
“Banks come in once the quality of the grains has been verified, received and stored in warehouses. The banks use RATIN, an EAGC’s market information system, to determine the prevailing value of the produce. Farmers are given credit of between 70 per cent and 80 per cent of the grain value,” Masila said.
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The grains are sold when the prices are optimum. The loan and storage costs are deducted and the farmer is given the balance.
Grains are sold through an online platform, G-Soko. NAFICS Grain Trading Limited, a grains selling company working with the warehouses in Kenya, Uganda and Tanzania recently sold about 200 bags of maize at Sh3,000 after five months.
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The company had bought the maize at Sh2,100 and stored the consignment in the EACG certified warehouses.
Masila was speaking during the FoodTrade East and Southern Africa conference in a Nairobi hotel, where UKaid agribusiness grantees converged to learn more from one another.