Kenyan pyrethrum farmers to finally be paid arrears; reform efforts gather pace

Two thousand Kenyan pyrethrum farmers will be paid Sh200 million ($3 million) for previous deliveries of the crop to the State-owned pyrethrum processor. The money, to be paid out on June 18, is being backdated for produce delivered to the Pyrethrum Board of Kenya (PBK) between January 2003 and July 2005 but never paid for.

Agriculture minister Kipruto arap Kirwa announced the payment, adding that another Sh663 million ($10 million) in arrears to producers will be factored into the new budget. The Cabinet took the decision to take over the payments after a local commercial bank collapsed with the board's savings, leaving farmers without payments for up to four years.

Farmers are expected to soon nominate six representatives to the new PBK board. Mr Kirwa had previously sacked some officials for mismanagement. The minister has picked four officials, who are expected to fast-track the pyrethrum industry's recovery, after years of slumping production and mismanagement.

Kenya's pyrethrum production peaked at 16,000 tonnes and was at 11,386 tonnes as recently as 2002-2003. As the PBK stopped paying farmers, many pyrethrum growers turned to other crops which would bring more certain rewards. By the close of 2006, growers recorded just 1,003 tonnes.

Efforts to rescue the industry have accelerated in the last year. Construction on a new 50-megawatt processor is under way that will "raise the capacity of the (PBK) factory to process 15,000 metric tonnes of dry flowers annually," said Kirwa.

The ministry is also making available 35 million seedlings on credit to ramp up production with a goal of 7,500 tonnes by next year. One time leading global exports of pyrethrum, with nearly 70 per cent of all global sales, mainly to markets in Europe and Asia, Kenya needs a sustained effort to get the industry back on track, say stakeholders.

Many growers and other stakeholders have voiced concern with what they considered weakening of the PBK, which is the only processor in the country. If not salvaged, the industry will be left with over Sh1.5 billion ($22.5 million) in intangible assets.

Business Daily