Annex 5

Study Tour & Traveling Workshop, KenyaSeptember 30 – October 4, 2013The LIVES project organized a study tour and traveling workshop to Kenya with delegates from the Regional Bureaus of Agriculture, the Regional Research Institutes, Regional Livestock Agencies and IWMI staff (list of participants attached). The aim of the tour was to take home some lessons from Kenya’s well developed small scale Horticulture and Dairy industries.

September 30th, 2013

Expectations

At the start of the study tour, the group revealed that they expected to see the following over the next few days:

How households were benefitting from banana (model farming) Crop extension & irrigation. Kenyan small holders and how different they are from their

Ethiopian counterparts Service providers & the export market for farmers The Value Chain approach and the awareness level of farmers of commercial produce New things but also farmers selling bananas and the presence of collective action Vegetable crops, horticulture Value Chain, and how the DAs communicate with farmers The extension system – how it works or is it there at all? Intensification & diversification and how to increase intensification in the Ethiopian system.

Small scale irrigation which is important for fruits, vegetable & fodder production. Integration of the tree livestock system

Napier grass, dairy Farmers’ linkages in input/output marketing Something unique especially in irrigated agriculture and dairy value chain in order to convince

Ethiopian policy makers and be able to implement it No free grazing – how did they get to no zero grazing, how do they control and manage & why? Integration of the water and crop management systems. Linkage between livestock and

horticulture To learn from everyone in the bus and how we can all work together Good practices in water management, and multiple use/management of water To get to know our partners better since will be working with them and also learning a lot from

everyone New technologies (hardware for livestock & horticulture) and new processes (socio-economic to

solve issues in the value chain) A stronger LIVES + partners team and have a common understanding of the implementation of

the project

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To learn about the good experiences in value chain (dairy, horticulture) and understanding the relationship between horticulture & livestock byproducts and to share/influence decision in Ethiopia

Where are we & where is Kenya? Our strengths and weaknesses and the links between livestock, crops & irrigation management

What was the role of the extension service during the transformation from subsistence agriculture to commercialization?

Understand how smallholders are working on irrigated horticulture crops and the linkage with the market. Integration with soil & water conservation feed and water management

Production technologies

October 1st

Farm Visit – Jesse & Esther Munyua

This 4 acre farm is owned by an elderly retired couple who have dairy, bananas & maize. They believe that crops & dairy are inseparable since they use manure for fertilizer as buying it would be too expensive. They used to have normal bananas until Africa Harvest started providing them and other farmers with tissue culture banana. The NGO also helped them in marketing, accessing technical information and also linked them with financial institutions.

They use piped water inside the house and rely mainly on rain for their crops but also harvest roof water for use on the farm. Mr. Munyua told the group that when they need AI services or when the cows are sick, they call the local (private) technicians. They pay about Birr 500 equivalent per insemination. Mr. Munyua also explained that public sector extension agents never come to his farm.

Their cows are fed supplement plus hay and produce anywhere from 5 to 24 liters of milk per day which they sell at 35 shillings per liter (Birr 7/litre). They also have a chopper that they use for chopping stover and banana leaves. Male calves are sold when they are about 3 months old.

Manure goes into a pit where they also add banana stems and other waste which is then used as organic fertilizer. Some of the farmers in the area have started with biogas which is not always successful but Mr. Munyua knows that he will need to eventually start as well.

The couple takes care of the farm and they sometimes hire daily laborers at for 200 shillings/day (Birr 40/day) to help them.

Bananas are harvested twice a year and are sold to the local cooperative. Prices fluctuate and the farmers are currently receiving 14 shillings/kg (was previously 16 shillings) for green bananas.

When asked why they do all 3 at the farm (maize, bananas & livestock) instead of focusing on just one thing, Mr. Munyua stated that no farmer can survive without livestock because of the fertilizer issue (they only use organic fertilizer not the industrial type).

In terms of what they consume in the household, it’s mainly maize, rice & bananas and a majority of what they eat is from the farm.

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The extension staff who traveled with the group explained that in the past, farming was mostly for subsistence but now the government is trying to make farmers more market oriented. Extension staff are also trying to show farmers that short time crops fetch better profits and provide them with practical trainings as well. Extension staff do calculations with farmers to look at their profit margins of different crops. The farmers can then decide on the more profitable crop. Avoiding the middleman is another approach that the Kenyan government is trying to apply so that the product goes from the farm directly to the market.

SABASABA Agribusiness Cooperative

The cooperative, whose main business is banana, is led by a democratically elected 5 member management committee. Tuesdays & Fridays are market days where farmers bring their bananas that wholesalers have ordered and paid for in advance. There are 120 members (59 male and 57 female) and membership is open to all farmers who grow bananas. The plan is to have 1,000 farmers by the end of 2014.

Sabasaba started off as a self-help group that was formed in 2004 and with the help of AfricaHarvest farmers started growing tissue culture banana which was more economical and disease free or resistant as opposed to traditional banana suckers. After they harvested their bananas, farmers were assisted by Technoserve to market their products. Bananas are very nutritional and have a high content of carbohydrates, magnesium & potassium. Kenyans say that if you eat one banana a day you avoid a trip to the doctor!

In 2009, they were registered as a Cooperative society and developed a 5 year plan (strategy) for 2010 – 2014. A one million shilling loan (which has now been paid off) was then secured to buy 1 acre of land which is where the office is located now.

Over 5,000 households have benefitted from this project in terms of sustaining prices as well as the market, quality of the product etc.

In 2011, over 150 tons of banana was sold through this society and 2.3 million shillings were paid to farmers. In 2012, the total number of bananas sold was 143 tons and was worth 2.2 million. Between January & April 2013, 80,000 tons of banana worth 1.2 million shillings has been sold. The average now is 20 tons of banana per month and the target for 2014 is 50 tons. There is an independent annual audit of income that is then reported to members

Sabasaba has decided to move things to the next level and has begun value addition in order to make more money for farmers. They have started the following although on a small scale:

Ripening bananas Banana Crisps Banana jam Banana Flour (from green, unpeeled bananas)

Their reasons for this value addition are to:

Increase shelf life

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Stabilize the market Link with markets (supermarkets) Create rural industrialization Create employment & wealth Help the government enhance food security

The Cooperative is also planning to diversify to other crops (such as tomato) in the near future.

There are however a few challenges that Sabasaba has encountered, namely:

Need capacity building Lack of ICT Lack of resources to acquire equipment More power supply (3-phase) required Transportation of bananas from individual farmers to the Cooperative office

Sabasaba plans to empower and transform farmers to make them more profitable, ethical and prudent in their business activities.

The cooperative does not handle cash, buyers deposit money into an account and the farmers are also then paid by depositing in their account (using mpesa). Value addition is currently done at the Cooperative office.

Questions/CommentsCan you please elaborate on the challenges that you mentioned?In terms of ICT, it does not exist here, so we want someone to come and show us the technology so that we can decide whether we can afford it or not. Transportation for farmers coming from different directions is also a big issue as the expense of transporting is very high (and is currently borne by farmers). We would like to have a common means of transport for all farmers traveling here from one area. We would also like to make roads more accessible especially when it rains which makes it almost impossible for farmers to bring their bananas to the office.

Can you provide more information as to why value addition is more profitable?For example, one kg of banana flour is made from 6kgs of green bananas and is sold for 200 shillings and the production cost is about 140 shillings. But when you convert 6kg of green bananas they fetch 80/90 shillings.

How do you communicate with your buyers – what’s the strategy?We speak with the buyers before market day and they deposit the funds in advance. The farmers will then have to deliver the bananas before 10am on market day and they get their payment the same day.

Do farmers know when to harvest green bananas? Those farmers who have been sponsored by Africa Harvest get trainings at KARI to be trainers (ToT) so that they can teach other farmers. The training is to teach farmers how to best raise bananas (how much manure and water they should use). A resource person then visits the farmers to see how they are managing.

Are you paid for working here?

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We don’t have a fixed salary, most people who work here are volunteers who get allowances for certain activities. However, since we are all farmers, we benefit from bulking our product.

How does the Cooperative make its money?We deduct 1 shilling for every kg of banana that goes through the Cooperative.

Do you have different channels for the value added products? We don’t have a strategy yet because production is still minimal.

How does one become a member? He/she has to be a banana farmer – with at least 40 stalks of banana (mature) and have a total

of 80 stalks Pay the membership fee of 2,000 shillings (one-time fee). The cooperative also sells shares on

the spot, a minimum of 150 shares and a maximum of 1,200 (20 shillings per share)

What are your challenges in terms of disease and do you use fertilizer?Our bananas are not prone to disease but if there is a breakout, extension agents from the MoA come to help. We never use fertilizer, only compost since there are too many side-effects from using fertilizerWith tissue culture banana, the seedlings are programmed, so after planting, it buds within 9 months and becomes a mature tree within 4 years. The traditional banana on the other hand will take 2 years to bud.

There are individual banana traders (private) so how do you manage the competition as a cooperative? We preach the benefits of becoming a member and we are seeing that membership is increasing every year.

Where are you value addition facilities & store for peak harvest time?All our facilities for the moment are here.

Can members sell to buyers outside of the cooperative?No the bylaws do not allow them to do that.

What’s the role of the government extension system?The MoA’s extension system is demand driven and they come when we need them.

What is the advantage of being a formal society as opposed to a group? A group has no formal rules but a cooperative must abide by rules set by parliament and is covered by national laws. For instance, if Sabasaba was a group, we (LIVES) could not have met to have these discussions. In addition, a cooperative is accountable to its members, is audited, and has access to credit.

Is there adequate market for value added products? We believe that the market is ready for us although we are not yet fully operational.

Do you organize trainings on sensitization?We organize trainings and different professionals are selected to come and conduct these trainings.

How much do the banana bunches weigh?

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The average weight is 25kg, but the biggest we’ve had so far is 64kg

NICOLA Farms – Private pulse and livestock farm

Located in Central Kenya, about 1800m above sea level

Whenever new seeds are introduced by private companies, they go through KEPHIS for approval. If the company approaches Nicola farms with these new seeds, they only take about 1kg for trial to compare it to the ones that are already growing on the farm and decide if it’s acceptable. Manure from the dairy farm is used as fertilizer, and the farm is moving towards organic farming.

Nicola’s marketing team has direct contact with companies in Europe and exports all of its products except for bananas which are sold to employees. French beans are all exported since they are not consumed locally. About 70% of their export product comes from out-growers (some have been with Nicola for 14 years) while the remaining 30% comes from the farm. Nicola farms doesn’t use middlemen/brokers.

There is a technical assistant in every region to assist the farmers and meetings are held with them every Saturday. For quality control, there are strict procedures that must be adhered to by the farmers.

The underground water in the area is very saline and cannot be used so Nicola Farms uses the river instead and pay the government 0.05cents per meter cube of water. Water from the river is pumped to the farm and this is closely monitored by in-house engineers. They also store water in reservoirs when there is enough of it.

Observations by the group at both farms:

Integration at farmer & commercial level Complimentary crop and livestock systems No need to use commercial fertilizer - farm manure used instead minimizing cost of production

and increasing profit There is integration even at household level & gender sensitivity Integration – adoption of best approach for evaporation saves water for harvesting & water use

efficiency Tree/crop/livestock system Manure at pit level can be used especially for vegetables & fruits (high value crops) Sprinkler – can intensify at small holder level VC benefits for producers and consumers Good practices – agro forestry. Use of by products for livestock (eg bananas) is not done in

Ethiopia SABASABA, transparency of the cooperative e.g. price of banana Nicola – is very organized in terms of the out-grower system as well as support for credit general The role of the extension system is very different from Ethiopia since it’s demand driven Marketing of bananas as compared to Gamo Gofa which also has a system of contracts with ET-

fruit but unfortunately ET-fruit cannot support everything that’s produced so there’s more supply than demand (they get their orders from Addis). Marketing is stronger with Sabasaba and there are fixed buyers. In Addis, banana is controlled at wholesale level

Extension is more demand driven

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There is more of a market oriented extension system which is not confined to production & technologies, it goes beyond. For instance, gross margin analysis is done with the farmers so that they can choose the most profitable crop

It rains more here than other areas but water scarcity is still a problem and almost every farm/ household harvests roof water

The Cooperative and its members are very knowledgeable about the nutritional value of bananas

Farmers pay about $20/per AI session whether it works or not. The same should happen in Ethiopia where seed supply, drugs, feed supply should eventually shift to the private sector, especially for market oriented products

We have seen the concept of ‘farm to fork’ in action We have seen a value chain at both Nicola Farms & Sabasaba Cooperative which can also be

done in our regions Perhaps LIVES can support tissue culture bananas in the Regions? We should encourage private sector development We don’t have people representing marketing in the LIVES PSC. We can bring in an expert as and

when needed We have observed direct & indirect beneficiaries, small & large scale value chains, input supply,

and the availability of land & water resources Integration of crop/livestock system Diversification Water conservation An extension system being demand driven Rain water harvesting & storage – what can we do that in Ethiopia? Struggle to transform from group to cooperative Nicolas farms – being able to meet European standards is very impressive Integration of livestock, crop & water management diversification Value Chain in packing & export is based on criteria of consumers There is no free grazing, which also needs to stop in Ethiopia Managing orientation of livestock so that they are more productive Using Napier grass as feed

How did communal grazing lands come about in the highlands? Large number of ownership?? Economies of labor

October 2, 2013

Farm Visit, Robert Githua, member of Wakurima Dairy Company

The population in this area is very high so land intensification is crucial. Dairy farms are usually very small, less than 1 acre so dairy farmers need to rent land outside of their farms to grow feed (and also buy as needed).

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The farmers call the Dairy Cooperative and ask for trainings which is then provided on farm (for 7 – 10 farmers). Government extension staff also help, but are understaffed as there are 5,500 active farmers.

Farmer Robert was born in the area and raised by a single mother who was also a farmer. The family land is 2.7 acres which is now divided among Robert & 3 of his siblings.

In 1984, after finishing 11th grade, he came back from Nairobi and started a coffee plantation. In 1985 he got his first cow (an Ayrshire ) from a friend and by 2005 he had bred 18 cows of which 7 were Friesian /Jersey cross breeds. He preferred the Jersey breed since they consume less & are more ‘hardy’. In 2005 he lost his wife and lost most of his cows except 2 heifers but by 2006 he had increased this number to about 10. In 2009 he faced a marketing challenge since processors didn’t want to buy all the milk that the farmers took to them so he decided it was better to sell most of his cows and he was left with only 2 or 3.

His cows now produce 40liters/day and he has no marketing problems since all the milk goes to processing. The Cooperative pays higher than anyone else and finds other markets for the milk such as Nairobi and beyond. One liter of milk is sold for 45-50 shillings and the farmers get 30-35 shillings.

He calls the vet/AI technician when the cows are sick or if they are in heat. AI costs 1800 shillings/insemination (Jersey) and could go up to 4,000 shillings depending on the breed. The cooperative’s vet doctors are used and the cost is deducted from the milk sale. Robert explained that he has also used sexed semen before.

DiscussionDairy cows need a lot of water, how reliable is the water and how do you get it to the farm? He uses tap water which is distributed by the government and pays for what he uses but unfortunately, the water system breaks down every 6 months or so. He gets feed from the dairy cooperative on credit also uses fodder trees that are on the farm for feed (Calliandra) and mixes it with Napier grass. He then uses the cow dung as fertilizer for the Napier grass that he grows on the farm.

What are the challenges you face?Robert stated he has a few challenges, the most serious ones being as follows:

Shortage of cash to buy needs for the cows. He would like to build a tank for silage to enable him to feed his cows uniformly throughout the year so that he can have consistent production & income

Shortage of space which means that the cows are cramped in a small place Shortage of feed at this time Tube silage (plastic) which he used before is too expensive because he has to buy tubes for

500kg of silage which costs 600 shillings but cannot be used again. He now wants to construct a concrete tank with plastic inside which he has seen successfully done before by another farmer

What are your monthly expenses for feed?When using Napier grass & Calliandra he spends 15,000 shillings but if he has to buy feed to add to what he has on farm, it goes up to 30,000 shillings per month.

Robert also went on to explain to the group that dairy is the best business to be in because there are 3 sources of income from it that comes from sale of manure, milk and the cows themselves.

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As compared to coffee, the dairy business brings a daily income whereas coffee is only once a year and the income from it depends on the outside market.

Farm Visit – Joseph Wanjohi

This is a family owned farm which has 4 dairy cows and 2 calves (all Friesian ). There are 7 acres that are divided among 4 family members so they each have about 1.5 acres each. They use the following as feed for the cows:

Napier grass, hay, maize stover (dry matters are necessary to avoid diarrhea) Concentrate Minerals

There is also a small coffee plantation on the farm. Joseph has no other source of income except pension as he retired from working for TOTAL in Nairobi. He has hired one staff member to collect Napier grass, all other work on the farm is managed by the family members.

The cows produce an average of 15 – 16 liters of milk per day which is delivered to the Wakulima Dairy Company (of which Joseph is Chairman of the Board). The company has a total of 18,000 members out of which 6,000 – 7,000 are active members who deliver milk every day. Each member owns a minimum of 5000 shillings worth of shares.

Dairy Collection Site Visit

Collects milk twice a day from members at 4am and noon Members come with their cards and drop off their milk which is measured (on the truck) and

that info goes automatically to a hand held devise held by staff Members are paid once a month An honor system is in place and quality testing is done arbitrarily once in a while

BORA feeds Owned by the Dairy Company and feed is made from maize grain, cotton seed cake, sunflower

seed cake, wheat bran, wheat powder, maize and fish meal Materials are ground up and packed for shipping. Feed is prepared for dairy, poultry and swine. Pellets will be produced in the future The low cost of feed that Bora offers sets a price for competitors who also prepare feed. Members are allowed to buy from other suppliers Bora takes cash or credit (for members only) Came about because none of the existing companies could guarantee the quality of the feed

that was needed

Wakurima Dairy Company

Established on November 16, 1990 with 2 liters of milk that was delivered

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All are small scale farmers with an average of 2 acres & 2 cows The main idea for the company was to improve the livelihood of the farmers and dairy is their

core business It started as a self-help group then changed to a cooperative, then to a share company in 2006

with the same members and same shareholders. In 1994 AI services were introduced in order to produce higher amounts of milk & have better breeds. In 1998 they opened their first store for dairy and milk supplements (to guarantee what the farmers needed were available) and 95% of the farmers buy on credit. A credit & savings was also opened and credit was made available even for advances and as follows:

o Purchase of cows (8% interest rate)o Constructiono Others (14% and above)

Governance – Board of Directors, management (recruited by the Board) and staff

The Company faces quite a few challenges, the main ones being: Prices – no control and are always dictated by processors There is no strong body for the farmers where they can say what they feel The condition of the roads makes it difficult to reach farms

Their extension services offer training for farmers as needed.

Wakulima is currently only doing raw milk but would like to start on value addition since they have seen what the other big players are doing and have also done a feasibility study to construct processing facility.

DiscussionWhat is the difference between a cooperative & a company?

Self-help – not legally recognized plus there is a limit on the number of members Cooperative – run by the members and based on cooperative society laws Company – legally recognized business entity

Each member owns a minimum of 5,200 shares, the cost of which is deducted every month from the milk they deliver.

Observations from the group

There are four major issues that were addressed during the visits today:

1. Production, feeding, breeding, disease management, marketing2. Role of the cooperatives in market oriented dairy production3. Issues of land use, farming system, intensification4. Level of education in the dairy production system5. Water availability, economics & dairy

1. Production, feeding, breeding, disease management & marketing

Land intensification was apparent with farmers who have small areas that are occupied with fodder, banana – the crop component is there

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There is a different feeding system from Ethiopia, which is based on green forage throughout the year and farmers also add their own feed

In addition, farmers are willing to pay for AI & healthcare. No one owns indigenous breeds of cows, they are all grade cows

There are small holder cooperatives in Amhara but they are not effective because of marketing & feed issues. The structure is good here and the marketing linkage is intensive because the cooperative is strong

Feed supply does not exist in Amhara but dairy cows are efficient because of the minerals that they get. In Ethiopia, it’s not easy to get concentrate and therefore, getting milk is not easy

The construction of houses – simple & easy to manage (inexpensive) In Ethiopia, forage can be grown, it’s just an issue of being market oriented Most farmers have completed at least secondary school Extension system – should be demand driven Farmers look at market opportunities for production & marketing of milk Land holding per household is small so think of what you can do and look at the market

opportunities Poor housing – no bio gas unit (for electricity), waste management can be improved. Efficient

nutrient cycling Water issue – rain water is harvested but municipal water is also used When compared to Ethiopia, there are differences in knowledge & skills in management Credit is available but nothing was mentioned about insurance for cows There were choppers at all farms that we saw. We should try this with LIVES but need

economies of scale so maybe we can do this as a demonstration or have a mobile chopper on a motorcycle

The calving rate here is 1 calf/year but in Ethiopia it’s 1 calf in 2 years which is because some farmers don’t want their cow to get pregnant while feeding. If the feed is improved then the cows can get pregnant faster.

2. Role of Cooperatives on Market Oriented Dairy Production

We’ve seen impressive things with the Cooperatives in Kenya as compared to those in Ethiopia. The farmers here trust their cooperatives & vice versa. The situation in Ethiopia is different and we should take these lessons back.

The collection center is quite efficient and they also have the motto of ‘Farmers serving farmers’ which shows their commitment. Farmers should help each other and this allows them to do this and also learn at the same time.

The way the business was started was also important to know (2 liters, 5 farmers) since one can start small and then expand. The cooperative is serving the farmers in many ways:

Training of farmers – they don’t need to depend on DAs so this decreases admin costs for the government

Credit – which is good especially for the weaker farmers Facilitation of marketing. If individual farmers had to coordinate for the market, they

wouldn’t be as successful Feed – farmers in Ethiopia want to get concentrate but don’t have access (even if they have

the money) therefore availability plus quality is ensured

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Veterinary services – in Ethiopia, we depend on our DAs, but here they have their own (40) vets

The cooperative is a place where the members can learn but are also able to obtain inputs in a timely manner at an affordable price

The cooperative has the legal framework to do business and farmers trust it Our farmers should want to set up a cooperative of their own free will based on commitment

and interest Cooperatives have a milk & food processing unit which is important for the members In Ethiopia, there is a lack of feed processing Dairy development needs capital (as does horticulture) so we need to find a way of solving this

problem

Why do we need to organize collective action (organization of farmers who work together for a common goal) – we need to look at dairy as follows:

Economies of scale – reduction of cost because of volume. They worked hard to increase milk production

Capacity – easier to capacitate them. 40 vets, many AI techs, extension staff – the cooperative has availed core capacity at the office

Better access to information – increased bargaining power (benefits accrue from being organized). We went today representing many farmers and also SNV people came because they were organized

Implementation – a few key areas that we need to take into consideration: Freedom to organize and not to be forced Accountability of leadership which is absent in Ethiopia Transparency – accountability to the farmers (audit) Business model – diversification of the business Trust – quality control of milk is not done on a daily basis and feed, farmers trust its quality

3. Land use, forage production, intensification, NR conservation, Sustainability

Land management – soil & water management issues Intensification & diversification – function of land size which has its own impact Soil management – fertility management practice, they use manure not inorganic fertilizer so

fertility management is there Trees – managed well in a systemic manner. Calliandra is an important feed but is also

important in protecting their land. Tree/crop/livestock management is there Planting of banana in a big pit is important for management but also for the application of

manure (as was seen at Nicola farms) Producing suckers as planting material and selling excess manure are sources of income There is an integrated system in place in the dairy & coffee growing areas There are commercialization, intensification & diversification opportunities Dairy is a day to day activity, it’s number 1 in terms of sustainability versus coffee There is a strong inter-linkage between livestock & crops – maximum use, no wasted land. They

even plant fodder trees, so there is efficient use of land Linkages with the market are present

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Poultry & dairy goats are used as an integral part of the farm Dairy development projects were promoted 30 years ago and are now being used extensively Intensification of the system is market driven. 30 years ago the market was the driving force for

coffee. Now farmers are uprooting their coffee trees and are planting bananas instead. They are doing dairy as well

Wondering how the system will look 30 years from now, not sure about intensification of the land by then

HR as compared to Ethiopia is more developed and educated

4. Education

The level of education is important for the success of farmers. Kenyan farmers are doing better than their Ethiopian counterparts perhaps partly because of their level of education. They understand the kind of bulls they want for AI, know the nutrient composition of milk, bananas and dry matter. They have a skilled/educated manager who is sorting out issues since he has enough education to be able to overcome challenges. They have veterinarians and production personnel who are raising the awareness of farmers.

The more educated farmers are, the more technology uptake there will be. The group insisted on seeing an ordinary farmer with no education but is no such thing, they all have some sort of formal education and use technologies such as choppers.

However, it’s important to note that even though capacity building is fundamental it doesn’t have to be formal.

5. Water availability, economics & dairy

Water is part of the whole system. What we saw yesterday & today should be taken into context. This place is 2 hours from the market, but there are other areas that are not so close. Also, in terms of the capacity of the farmers, most of them had grown up on farms, went away to get their education and have come back later.

Water wasn’t really an issue since these farms are so close to Nairobi and there is piped water supply available. As we move away from thatched to corrugated roofs in Ethiopia, can we move to rooftop harvesting?

The Ethiopian Government is moving in the direction of roof water harvesting. How will we do it – how will it be implemented?

October 3, 2013

Horticultural Crops Development Authority (HCDA)

The HCDA is under the Ministry of Agriculture, Livestock & Fisheries and has 3 main functions:

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1. Regulating the horticultural industry. Guidelines for regulations are in place and the government has issued acts that guide on production & marketing

2. Provision of technical support for the farming community – farmer trainings on emerging issues for the international market

3. To market Kenyan horticulture producers in Europe & Asia. Promote exporters through fairs where potential exporters are invited to promote their products

Horticulture industry: Income from horticulture has increased to 200 billion shillings and the majority is domestic

(96%), export account for 4% only Employs more than 6 million people directly but also indirectly (transport, packing etc) HCDA also participates in government supported projects for farmer support

Horticulture in Kenya is private sector driven and the government just provides support.

Small scale farmers & exportersHCDA supervises contracts signed by these two parties. There is a law in Kenya that exports must be from your own farm or a small scale farmer. Payment is sometimes an issue since exporters may not pay the farmers so HCDA coerces exporters to pay. HCDA staff witness contract signatures to avoid forging and licenses are withdrawn from exporters if there is any foul play. Signing of contracts ensures traceability, there are articles in the contracts that spell out production and collection of the product. Traceability is important for the outside market.

High quality produce export Fruit nursery owners must be registered (mango, avocados & citrus) and are also trained on best practices. This is done to ensure true to type seedlings to the product.

HCDA also provides market intelligence to farmers & exporters: Horticulture storing to avoid post-harvest wastage Depots have been established throughout the country but cold room storage has not made

economic sense since it has not been possible to recover the cost of running the cold rooms Market driven horticulture is promoted versus resource based horticulture. In market driven

horticulture, the farmer responds to the market requirements Subscribe to market links to look at prices for exporters so that they can eventually export there Consumption of horticulture inside the country because Kenyans were producing vegetables but

didn’t consume them. Now there is increased consumption so importation of fruits (apples, oranges, grapes) has started. For instance, in the past, avocados were not consumed by Kenyans but there was a campaign that showed the advantages and now there is increased local consumption

Initially HCDA is involved in up and coming exporters to bring products for export The state cooperative is financed by the MoAL&F

HCDA has 25 offices in the areas where the main horticulture products are grown.

Discussion

How successful have you been in fruit nursery registering?

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Very successful since no one can operate a nursery without a license. We assist in marketing the seedlings. Nursery owners must fulfill a check-list before being issued with a license.

There are marketing problems in Ethiopia. How do you manage the domestic marketing and what is your role in this?It’s challenging as the local market is not very organized and the government is not very involved as opposed to the export market (avocado, mango) where products must conform to standards. The HCDA trains farmers for instance to avoid post-harvest losses as most farmers don’t bother with their products after harvesting. In any case, not much has been done so far but we are trying.

Local versus export market – how is the market structured? In Ethiopia, the local market is oligopolistic as there are traders who also control the retail system so farmers are price takers. In Kenya we’ve seen that banana farmers negotiate prices. How is the situation in Kenya?It used to be the case before, when all produce was sold in one place. Farmers would just go & sell but now there are many more wholesale outlets & markets and farmers are learning to bypass the wholesalers. Some just open stores in their own area so they don’t even need to go to wholesalers. They broke the cartel to directly sell to wholesalers, schools and, consumers. When they have too much produce, they might be forced to accept lower prices once in a while.

HCDA brought together farmers to create production & marketing organizations for farmers to have a common price (weight, price/kg).

Where do farmers get improved seed?Vegetable seed production – imported but is regulated and even multiplying is monitored by KEPHIS. It’s run by the private sector but quality inspection & license issuance is done by KEPHIS.

Is there adequate supply? Yes, since it’s run by the private sector they address demand.

Do you use mobile phone technology?In terms of access to market & technical information on mobiles, HCDA will host the system which is sponsored by many organizations. This is still in the initial stage but we are aiming for it to start in June 2014.

Value addition in bananas, have you tried anything in this regard such as additional processing?Consumers are not interested in value added products and there is no market for it. Products must meet Kenyan quality requirements and people prefer the fresh product therefore our advice is on plant production in order to avoid excess production since there are also storage issues.

What is the role of the HCDA in terms of the lack of practical skills in horticulture and also tissue culture?Whenever there is a new technology, HCDA does a demonstration on one of the plots of the farmers so that they can learn by doing. However, the main focus of the HCDA is regulation. The extension work that is done is to supplement what the MoAL&F is doing. The Government has agricultural training centers and also run farmer field schools.

Do you have tissue culture service?Yes we have labs for production but production is mainly private sector driven. KARI does that as well (banana but we are also trying passion fruit).

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Do you regulate the quality of the product for export market as well as the local market?In terms of mango & avocados, we look at maturity. Pesticides are checked by KEPHIS.

Do you have cooperatives such as Sabasaba for tomato for instance?Some are community based but cooperatives in general are not very strong in horticulture.

What are the things that HCDA is doing to increase local consumption?HCDA does promotions and there are campaigns to increase consumption of fruits & vegetables. The promotions show the importance of consuming milk. In terms of promotion, the MoAL&F has a home economics department who is in charge of such promotions.

Who’s responsible for importing improved varieties of horticulture crops?The HCDA’s role is in terms of ensuring quality of crops. The government (KEPHIS) is under the mandate of KARI and participates in trials to ensure imported seeds are able to grow. There is no control on prices since the sellers determine it.

There are many actors in horticulture, do all of them get together to discuss production, marketing etc? HCDA plans yearly stakeholder forums and as many stakeholders (from 47 counties) as possible are invited to discuss issues. National forums where international participants are invited also take place.

Is HCDA doing any work in terms of ripening chambers?KARI came up with the idea of ripening chambers which worked in some areas but there have been constraints on what it can accommodate. Others are using polyethylene bags – mixing avocados with bananas & some use passion fruit. We are trying to come up with new ways but things seem to be going well with people using their own methods. There is not much control by HCDA in this activity.

The group also visited the packing house which is owned by HCDA with funding from JICA to encourage young producers who would like to export and can’t afford or don’t have access to such facilities. Anyone who has export produce to store or pack can rent the facilities from HCDA.

Ministry of Agriculture, Livestock & Fisheries

Participants were from the following departments:Ministry of Agriculture, Livestock & Fisheries Director (filling in for) (Female)State Department of Veterinary Services (Female)Horticulture Division (Female)Extension & Training Directorate (Female)Horticulture Program (Male)State Department of Livestock (2 Males)

Points for discussion: Irrigated agriculture crops

o Irrigation water managemento Livestock development – dairy sector development

Role of the MoA managing, promoting, regulating Delineation of roles – private/public sector in terms of irrigated crops

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Input supply Service provision Input/output marketing Challenges & lessons learned in terms of applying the market oriented approach Production, input supply, services Any other business

The 3 ministries were combined into one as of March 2013Irrigation is handled by the Engineering department

A value chain development project of 8 VCs, started in 2003 and continued to 2013 for the following: Crop agriculture – mango, passion fruit, sweet potato, Irish potato Livestock – dairy goat, poultry (local), beef, fish (omena fish)

The project focused on key VC strengthening of stakeholders, market linkages along the VC, and building of markets.

There were a number of challenges especially in bringing various actors along the VC together (linkages)One of the major successes was in terms of the Irish potato value chain which has now become a national council which is farmer/private sector led.Mango which in the past was wasted because of unstable market & lack of linkages is now a success because linkages have been created with processors.

Horticulture Biggest business in terms of agriculture (2.3 billion shillings per annum) Domestic – fruits & vegetables (rain fed & irrigated horticulture) Export – flowers & vegetables

There is a program supported by ADB which provides irrigation system infrastructure and mobilizes farmers to produce for both the local & export market.

To determine interventions needed, a VC analysis was used with certain criteria: Crops predominantly grown by small holders & use rain-fed agriculture Market leadership – role of the private sector for development Income being generated by crops

Priority crops in every district & the constraints were identified as well as the challenges, opportunities and interventions. In the program, there is:

Banana (leading horticulture crop) Potato Cabbage Passion fruit Garden peas Mango Local vegetables – indigenous and grown by smallholders that are dried, packaged & exported

to the UK & US (niche market)

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To develop the value chains, market driven extension was provided to see what was required in the market & then steer production in that direction.

Support is provided by the MoAL&F as follows:

SoftwareProvide service for private service providers to work with market agents to link village groups to the markets.

Hardware Markets – designed with input from market players Storage – especially for potatoes (rapid studies show delays in increase of price), timing of

production & spreading marketing Collection centers – infrastructures where anyone can come and buy substantial amount of

a certain product and take it to any destination. Also, sellers can collectively bargain on prices

Rural access road improvement – access to farms. Link to roads that are already in place. Those roads that will not be considered by the government are what we will focus on. Farmers can take their productions and there will be reduction in the cost of transportation and, input. In addition, there will be less wastage and employment will be generated. The road improvements are almost complete, and outcome & impact is being documented

In terms of the value chain of irrigated agriculture & livestock, what is the experience of extension staff & DAs and what is the overall setup of DAs?The role of research is to develop technologies – seeds for different ecological areas, prepare packages used by DAs to advice farmers on best way forward. Extension in Kenya is very well developed up to the grass root level. The focus of the extension service is to organize trainings.

In the VC, what is the involvement of research institutes & MoAL&F for extension services?Adaptive research that is focused to farmer needs. There is a well-established extension system from county to grass root level. Front line extension officers have direct contact with farmers. There are also subject matter specialists (e.g. value addition, environment) and district level subject matter specialists.

The regional research centers do adaptive research to see what is relevant for farmers (that information comes from front-line extension officers). There are research extension liaison officers in every country (47) linking researchers with extension service staff so that they can focus on what farmers need. There is demand driven extension service (bottom to top), so that innovations are adopted and are sustainable. There are many innovations which are packaged (farmer friendly) & given to farmers.

There are different dissemination methods: Farmer field days (research stations where farmers can see latest innovations) Exhibitions Farm visits (for specific issues), by a combination of specialists who then come up with

recommendations

Research, extension and farmer linkages are still weak and we are working on strengthening this. The new setup of one liaison officer at each country will help strengthen:

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Joint planning Participatory M&E On farm trials

In terms of value chains, there is the issue of farmer empowerment through trainings and farmer field schools. Information desks are available where farmers can get information.

LivestockDairy goat value chain, main activities:

Strengthening of farmer groups for ease of collective marketing Capacity building (there are various regional dairy goat associations) for members of the

association e.g. AI, husbandry, feeding so that farmers can earn a living and supplement their incomes

There are staffing shortage issues so they are working closely with the media so that farmers can call into radio shows with their issues/questions.

There is a bull station in Nairobi and in the past, the government ensured that all farmers had access to AI. From 1963 – 1983, AI was highly subsidized and one insemination (exotic blood) cost 1 shilling. In 1983, AI services in Kenya were privatized and some projects came in to assist in the dairy industry.

Background information on Kenya: 17.5 million cattle, of which 3.5 million are dairy cattle, are mainly Friesian & Ayrshire Goats – 28 million (50,000 are dairy) Sheep – 17 million (no milking) Camels – 4 breeds and some are milked There are 1 million small holder dairy farmers who have 2 to 5 dairy cows and produce up to 10

liters of milk per day. There are also super animals who produce 40 – 60 liters per day The agro vet, AI services and bull stations are now all privately owned Dairy cattle breeding is well organized and available even at farm level AI services now cost anywhere from 1,000 to 10,000 shillings depending on the type of bull Farmers also make use of sexed semen and embryo transfer (large scale farmers) Feeding is mostly natural as farmers use cultivated fodder & Napier grass 5.2 billion liters of milk is produced per year – 30% consumed at home/fed to cows There are post-harvest milk losses due to spillage, rejection, and unavailability of market Milk consumed per capita – 125 liters (urban), 19 liters (rural) Milk consumption in Kenya is highest of developing black African countries

DiscussionWhere do the AI technicians get the semen from & what is the role of the ministry in terms of AI?AI services are privatized, however there is a central AI station – Kenya Animal Genetic Research Institute and there are plans to increase the number of bull stations. The government & universities provide training opportunities for inseminators but the veterinary department is still regulating running of the AI services. The bull station is funded by the government of Kenya.

What is the capacity of the bull station?

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The bull station produces half a million doses of semen/year and additional semen is imported. This bull station alone is not sufficient so in future, there will be 2 more bull stations which will enable Kenya to export to neighboring countries as well.

How did you succeed in privatization?This was a highly political issue and the extension service used staff to convince farmers that this was a good idea.

Input/Output Market

This was run mainly by the private sector but the government comes in for fertilizer in order to stabilize prices. There were 3 companies who imported fertilizer and monopolized the market so farmers didn’t benefit much so the government imported in bulk which makes the price cheaper. The farmers therefore opted to buy from the government which forced the importers to lower their prices.There is also a targeted subsidy program that gives farmers maize, fertilizer & seed

There is another government program for building seed production capacity, especially for potato and the production of basic seed for seed multiplication. Farmers are brought together and trained on how to produce seed.

There are also agricultural training centers in potato growing areas.

Discussion

How was the extension serviced transformed from production & technology focused to market oriented?We are not completely there yet and we are encouraging collective marketing since that will better meet demand and also decrease the cost of production. The market demand is not met because the amount produced by small holders is not sufficient. We are also linking farmers to the market and not just supermarkets but also schools, hospitals etc.

Subsidies (smart) are justified for the following reasons:

It’s for the benefit of the farmers Ensures food security, especially maize which is a staple Farmers receive subsidies only once Once the farmers have graduated from the initial subsidy, they can get loans for the purchase of

seeds and fertilizer at a lower interest rate

Key Lessons for LIVES

Irrigated fruits and vegetables

Over time, the banana/fruit cartel in Nairobi seems to have been “broken” by opening up different channels other than the single whole sale fruit market one (like Piazza in Addis). One key intervention was the establishment of new marketing channels with consumer groups in different housing estates in Nairobi. This includes availing retail outlets in the housing estates.

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We could try this with consumer associations in Addis Ababa in combination with the establishment of banana ripening chambers in or near consumption areas

Price setting of bananas is accomplished in meetings attended by traders as well as representatives of the Kenyan Banana Growers Association. We, or other value chain projects, can initiate similar discussions between the Ethiopian Horticultural Agency and banana traders in Addis Ababa to arrive at more competitive prices for producers

The Sabasaba banana cooperative in Muranga District is regularly contacted by big traders to deliver certain quantities of bananas on 2 market days/week. The traders deposit money on the cooperative’s bank account, a day before the actual purchase, and the cooperative manager contacts growers to bring bananas. On the actual day of purchase, the producers’ bananas are weighed and the individual farmers account (at the same bank) is credited for the amount delivered. The cooperative deducts Ksh 1/kg as a trade commission. We could explore the possibility to introduce this system for the Lenta fruit cooperative in Arba Minch and the fruit and vegetable cooperative in Meki/Bati

The ripening process of bananas in Kenya is regulated/stimulated with the help of fruits (such as passion fruits) which stimulate ethylene emission in a closed environment (plastic is used). The Kenya Agricultural Research Institute is doing research on low cost banana ripening methods . We could try out some of these approaches in our banana growing areas

Extension on irrigation and agronomic practices is organized through input suppliers and cooperatives. Specialist extension staff are called upon as resource persons. We could examine the possibility of targeting some of the LIVES capacity development activities to the input/service suppliers, who in turn can provide knowledge/skills to producers of irrigated agriculture

The Kenya HCDA certifies fruit nurseries to ensure supply of quality seedlings (they have offices in the major horticultural areas). KEPHIS also issues certificates to nursery operators after completion of nursery training. We could explore the possibility for certification of nursery operators in our LIVES project areas. The appropriate agency (Regional Research Centers, EHA) should be identified

The use of tissue cultured bananas is well established in Kenya and introduction has been supported by NGOs. Seedlings may be provided by research institutions and/or private companies. We should explore the possibilities of introducing tissue cultured new banana varieties with our partners with linkages to private nursery operators

Out grower schemes for small holder vegetable producers linked to larger scale commercial farms are tested in Kenya, however, meeting the requirements for the European market is difficult to achieve for smallholders. Selection of well educated, motivated smallholders is essential. We could explore the possibility for out grower schemes (East Shoa) based on lessons learned in Kenya.

Dairy

Dairy farms in the areas visited are well developed and for their supply of feed depended on external inputs such as concentrates, purchased fresh grasses (mostly Napier) and hay. The farm

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itself produces part of its forages including protein rich Calliandra, which is reportedly very effective for milk production when mixed with grasses. In LIVES, we should encourage the introduction of appropriate grasses and Calliandra or other leguminous species to stimulate intensification of dairy farming

Roof water harvesting is widely introduced and used for human and animal consumption. We should explore the possibility of roof water harvesting in LIVES project sites in partnership with existing government programs

The extension message on cow fertility management is: one calf a year. While this was accepted by most farmers, it had not always worked for various technical reasons. As indicated in the recent LIVES blog about this issue, we should explore the possibility of introducing this “mindset”, providing we meet all other management practices

The input/service system in support of dairy development is almost completely privatized and not subsidized. This was in part the result of the structural adjustment program which occurred in the nineties. We are already aiming for such a system in LIVES, however we could further explore the use of private sector involvement in AI and veterinary services

Same as for irrigated horticulture crops, extension for dairy producers is partly provided by the input/service providers. We could examine the possibility of targeting some of the LIVES capacity development activities to the input/service suppliers, who in turn can provide knowledge/skills to dairy farmers

Manure produced in the system was used to fertilize the crops, including the plots planted with Napier. No use was made of manure to generate biogas. We should test the possibility of biogas technology on selected advanced dairy farms

The dairy company visited in Nyeri had several features worth pursuing in LIVES including: i) milk collection points which were visited twice/day by a truck ii) electronic weighing/recording of milk per farmer iii) a private company structure (PLC) which had features of a cooperative (only members

allowed to have shares), but was no longer bound by the rules and regulations of the Cooperative Department, but by rules and regulations of Trade and Industry

Knowledge management

Various electronic media (especially mobile phones) are used to transfer knowledge to producers. Our knowledge management advisor should explore the possibility of introducing some of these software packages, in consultation with IWMI who is also interested in this

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