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Role Of Marketing Boards In Kenya To The Economy

1306 words - 6 pages

Marketing boards are state-controlled or state-sanctioned entities legally granted control over the purchase or sale of agricultural commodities. Since the mid-1980s they have declined in number under pressure from domestic liberalization and from international trade rules that increasingly cover agriculture. Where reforms have been widespread and successful, marketing boards have vanished or retreated to providing public goods, such as strategic grain reserves or insurance against extraordinary price fluctuations i.e the National cereals board, the Tea board of Kenya. Where reforms have been less successful, the weaknesses of private agricultural marketing ...view middle of the document...

Role of marketing boards:
1. To provide price stability, marketing boards set the prices for farmers. During a season of high prices in the world market, they stash funds over and above the set local target, which they later use to cushion farmers whenever the global market prices plummet.
2. The marketing boards possess the sole legal authority to purchase commodities from farmers and to engage in trade.
3. Through the boards, governments typically fix official producer prices for all controlled commodities.
4. Marketing boards provide a guaranteed market for the farmers, absorbing all marketed surplus at the official producer prices, and maintaining extensive buying networks and storage facilities throughout the production regions.
5. Grain marketing boards commonly handle the strategic food reserves for emergency situations, and have the responsibility to import food in shortage seasons.
6. They also stabilize prices, thus protecting farmers from sharp fluctuations
7. The boards also obtain funds for sales promotion, research and extension services
8. to raise farmers' bargaining power- especially to prevent over exploitation of farmers by middle men
9. The boards also improve quality regulation.

In the last two decades, the production of primary exports in our country has been dwindling, and in some cases, almost ceased altogether. The crops in question are pyrethrum, sisal, cotton, coffee, and to a lesser extent, tea.
Examples of marketing boards in Kenya
The NCPB sells seeds and fertilizers to farmers at subsidized rates and buys their produce at higher prices than the market price, as a way of offering incentives to farmers.
To ensure food security, NCPB has silos all over the country that store grains in times of sulplus production and sell them in times of food shortages at affordable prices. This helps improve the country’s food supply situation.
2. KMC
The Kenya Meat commission which was recently revived, served an important role, during the droughts that ravaged the country, by buying cattle from owners, who would otherwise have suffered a very big loss as the animals would have perished in the drought. Now the farmers can replenish their herds when the drought passes.
3. KCC
The Kenya Cooperative creameries is also another marketing board that buys milk from farmers at better prices than go betweens and hence offering a ready market to milk as a produce in the country,
The Coffee board of Kenya and the Kenya Tea Development Authority also buys produce from farmers at good prices, so that farmers are ensured of a market for their produce and can be able to develop themselves from income earned. The boards then sell the produce through exports.
This board deals with buying pyrethrum from farmers and finding a market for it.
Boards established by the colonialists have, on the whole, been playing a major role in marketing most of these...

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