In an effort to maximise farmer returns in the grain and pulses market, the government has committed to implementing the Warehouse Receipt System Act of 2019.
The Warehouse Receipt System (WRS) seeks to stabilise grain market prices by reducing the pressure on farmers to sell their crops right after harvest when market prices are often at their lowest. It will also reduce post-harvest losses which contribute up to 30 per cent of all losses in harvested crops in Kenya and address price exploitation by middlemen improving farmers’ profits.
During his speech yesterday (2nd August 2023) on the state of agriculture in the nation, President William Ruto urged the private sector to work with the government to ensure the program is well implemented.
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“This system creates an ecosystem with opportunities for the private sector and NCPB to provide a high-class trading platform that links buyers to sellers and facilitates access to credit by agricultural producers,” he added.
Through WRS farmers can deposit their grain at a National Cereals and Produce Board (NCPB) certified warehouse where they are issued a warehouse receipt as proof of ownership. They can then choose when to sell their produce.
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The warehouse receipt can also serve as collateral for farmers to access credit.
Equity Bank, Cooperative Bank, Agriculture Finance Corporation, and Family Bank are some key financial institutions that signed up for a working partnership with the Warehouse Receipt System Council.