Growing maize not profitable for smallholders, study shows

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A recent report by researchers in the agricultural sector paints a grim picture of how farmers of this staple crop continue to earn negligible profits and sometimes losses.
For months, farmers toil to keep the national granaries full, but at the end of the season, enter negatives in their profit columns (for those who are keen on record keeping).
The research was carried out in seven maize growing counties, including Trans Nzoia and Uasin Gishu, Kenya’s food basket. Egerton University’s Tegemeo Institute of Agricultural Policy and Development released the findings in early September.
According to the report, government interventions such as fertiliser subsidies in some counties have not done much to change the fortunes of North Rift farmers. Production per acre remains lower than in other maize producing countries such as the United States or Canada.
Prices offered by the National Cereals and Produce Board (NCPB) are not attractive but are higher than in Uganda. The average production per acre is 17 bags for small-scale farmers. The total cost of producing a 90kg bag is Ksh1,650, while the average selling price is Ksh1,900, meaning that the farmer pockets only Ksh250 per bag.
A farmer who opts to grow maize on one acre waits for nearly a year to earn Ksh4,250 from the 17 bags, assuming nothing is consumed at the household. The situation becomes gloomier if the crop is grown on leased land, where the cost of producing a single bag rises to Ksh2,238, meaning that at the price of Ksh1,900, the farmer incurs a loss of Ksh338 per bag. The lowest cost of leasing an acre of land in the sampled areas is Narok County at Ksh5,000 while it is high in Kakamega, Trans Nzoia and Uasin Gishu counties, at Ksh10,000. Other counties surveyed included Bungoma, Meru and Nandi.
But the situation changes for large-scale farmers practising contract farming. They have a ready market and price is the predetermined. Work is mechanised, resulting in efficiency and a higher production.
The report indicates that large-scale farmers in Uasin Gishu and Trans Nzoia counties sell their produce to the NCPB or established millers at Sh2,300 per bag. Yield per acre is 21 bags and the farmer still makes profit whether using subsidised or commercial fertiliser, leased or own land with profit per bag ranging between Ksh1,020 and Ksh855.

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