The government has announced reforms in order to address the perennial challenges facing agricultural production and trade by establishing a warehouse receipt council.
Agriculture Cabinet Secretary Peter Munya said Warehouse Receipt System (WRS) will now be an open trading platform that links buyers and sellers, and modelled along the stock exchange.
The establishment of the council now replaces the roles Government has been undertaking previously of buying, selling and setting maize prices, a scenario that has been characterized by business unethical practices leading to grand corruption.
In the new reforms , Munya said Government is fast tracking in the food industry and the council will be the facilitating platform of the market whereby farmers will have an opportunity to store their maize and also monitor prices.
Farmers have been depositing goods in an exchange for a warehouse receipt (WR) reducing the pressure to sell immediately after harvest when prices are normally low and enabling them to monitor the prices and sell when it is favourable
According to the CS, the Warehouse Receipt System will remove the logistics burden and facilitate producers and traders to access agricultural credit against the deposit certificate.
“The Warehouse Receipting Council has now been appointed and we shall soon be inaugurating the Council and which already has an appointed acting CEO “, Munya said .
He added that reforms will include enhanced private sector participation in the agricultural value chain, including storage, thereby creating a competitive food market and the efficiency that comes with it.
Other reforms the CS mentioned were revamping of food Balance Sheet Committee to oversee accounting and monitoring of the country’s food supply pattern, utilization and distribution and another will be Institutionalizing reforms to eliminate overlapping roles, conflicts between different government agencies and better respond to changing food demand”, he said .
Munya who was speaking today on the restructuring of the National food Reserve and Food storage management at the National Cereal and Produce Board (NCPB) offices in Nairobi said that to spearhead the implementation of these reforms he has appointed a Technical Working Committee charged with coordinating prompt and focused implementation of these reforms, and further to ensure that systems are in place to receive produce in the next four months by October 2020.
“To encourage the early participation of the private sector, and the establishment of ware receipt housing system, NCPB will release 7 million bags of space through competitive commercial leases. The release of designated storage space to private sector will proceed speedily and completed by December 2020” he said
Munya explained that in the next few days the are taking measures to invigorate the NCPB Board and to inject the required expertise for oversighting the revamped functions of NCPB.
“ To better ensure that NCPB as an organization execute more effectively and devoid of historical burdens, I direct the Technical Committee and NCPB Board to immediately undertake capacity and suitability vetting of all the serving officers”, he said .
Soon he said they will undertake a policy legal review towards the harmonization of mandates of various agencies under the agriculture sector towards enhancing their complementarity.
CS Munya said that from September this year, the Agriculture and Food Authority (AFA) in collaboration with the counties will undertake the registration of farmers, dealers, and the licensing of primary warehouses, the Warehouse Receipt Council will be responsible for warehouses trading in the Commodity Exchange (KoMEX).