Farmers in Kenya may soon have more stability in the pricing of their produce, with county governments and the Kenya National Bureau of Statistics (KNBS) set to determine prices for agricultural products.

This follows a bill tabled by nominated senator Veronica Maina, aimed at establishing minimum guaranteed returns for agricultural goods, ranging from vegetables to fruits.

The Agriculture Produce (Minimum Guaranteed Returns) Bill 2024 seeks to shield farmers from unpredictable market fluctuations and set fair minimum returns for their produce.

At the heart of the bill is the creation of a pricing mechanism for each county, with returns tied to data from the KNBS.

This pricing framework will factor in multiple inputs, including farm necessities such as seeds, fertilisers, herbicides, and pesticides.

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For livestock farmers, the cost of animal feeds and veterinary drugs will be considered.

Additionally, labour, fuel, irrigation, machinery, and farm rent are integral to the overall cost considerations.

The proposed bill stipulates that: “The minimum guaranteed returns shall be twenty per cent of the profit above the comprehensive cost,” ensuring a stable profit margin for farmers. However, the bill allows for reviews due to the dynamic nature of market prices.

The legislation includes strict guidelines on eligibility and the mode of payment for these returns.

“Minimum guaranteed returns shall only be paid where the agricultural produce is largely consumed locally, through direct transfers to the beneficiaries’ bank accounts, and in instances where the market returns obtained by beneficiaries fall below the recommended minimum guaranteed returns,” the bill outlines.

Furthermore, the funds may be suspended or cancelled if farmers obtain payments fraudulently, or through misrepresentation or failure to disclose key information. Instances where payments exceed published or approved amounts may also trigger penalties.

Currently, the pricing of agricultural products is left to the whims of market forces, co-operatives, government agencies, and regulatory bodies, often leaving farmers vulnerable to price swings.

This new proposal could dramatically change the way agricultural pricing is handled in Kenya, offering farmers a more secure and predictable income.

If passed by the Senate, the bill is set to redefine agricultural commerce across the country, potentially transforming the livelihoods of millions of Kenyan farmers by offering a safety net against erratic market forces.