NCPB to mop up all wheat stocks held by farmers, AFA says as it defends need for imports

The government has clarified that it has tasked the National Cereals and Produce Board (NCPB) to buy all the wheat held by farmers beginning today.

The decision was made on Monday during a meeting chaired by Agriculture Cabinet Secretary Mutahi Kagwe, which brought together government officials, the Cereal Millers Association (CMA) and Cereal Growers Association (CGA).

The clarification came amid reports the government has licensed 35 millers to import wheat worth Ksh 124 billion raising fears local farmers would suffer massive losses.

In a statement, the Food and Agriculture Authority (AFA) said millers will collect wheat from NCPB stores with payment being made within 30 days of delivery.

AFA added that is monitoring the mopping up of local wheat in a move seen as ensuring imported wheat does not makes its way to NCPB stores.

In justifying the need to import wheat, AFA said that the national wheat demand is 2.2 – 2.4 million metric tons annually but the country produces about 8 per cent of total consumption while 92 per cent is imported.

“Kenya’s annual wheat production was 135,000MT in 2023 against a consumption of 2,200,000MT which
has been increasing in the last five years. The deficit of about 1.9-2.2 MT has been filled through imports majorly from Russia, Ukraine and EU,” it said.

According to AFA, the total local wheat harvested from July 2024 to March 2025 is 1,710,358 (90kg) bags, adding that millers have mopped up 1,388,762 bags from August to date.

It said the total available wheat with farmers and marketing agents is about 321,596 bags, the bulk being in
Upper Narok with 130,828 bags. The remaining wheat to be harvested in Upper Narok and Timau 2 is projected at 80,000 bags. In the last eight months, the total amount of wheat imported was 1,407,129 MT (15,634,767 bags) against a projected allocation of 3,246,000 MT (36 million bags).

AFA noted that Kenya is a key member of the East African Community (EAC), and is a signatory to the
various protocols and instruments, and an active member of both the Customs Union and Common Market.

“It has always strived to meet its obligations within the union, while also protecting its national strategic interests, expanding markets for its products and services, and assuring food and nutrition security for its citizens. Wheat is classified as a trade sensitive product in the EAC’s Common External Tariff (CET). The CET is an instrument  commonly used in trading arrangements where the cost of importing goods, products or services from outside a trading bloc is higher for items listed in the sensitive schedule, to primarily protect local producers, industries and consumers from unfair competition, cheaper imports or even dumping.”

“Sensitive products attract a higher interest rate of 35% as opposed to the 25%. Kenya, having witnessed the gradual decline in local wheat production since the 1990s, but with a commensurate rise in consumption of wheat and wheat products, decided to negotiate a lower rate of import tax under the CET of 10%, to allow wheat imports to meet the rising consumption demand while also rejuvenating the local production,” said AFA.

It added that the objective of Kenya’s application was to increase local wheat production and reduce
overreliance on imports.

“Since 2010 on the advent of the new constitution, and while obligated under the EAC’s Customs Management Act of 2004, the Customs Duty Regulations of 2008, and the EAC’s Customs Union Duty Remission Scheme to meet the EAC’s protocols and agreements, Kenya instituted the Wheat Purchase Scheme (WPS), which obligates millers to purchase all the locally grown wheat at set prices, pay a duty of 10%, instead of 35%, while also granting the millers quotas on a pro rata basis, to import wheat to fill the gap.”

AFA said the WPS was launched on 8th January 2010 by the Ministry of Agriculture then later transferred to it on 1st July 2020.

The National Treasury witnessed the agreement between Cereal Millers Association (CMA) and Cereal Growers Association (CGA). Other EAC member states import at 10% without such a pre-condition.

It said a survey it conducted in February to March 2021, established that production had been declining over the years with increasing imports. Production decreased from 256,000 MT in 2010 to about 180,000 MT by 2020 for example.

During the same period, imports increased from 845,000 MT to 2,200,000MT. This scenario has been attributed
to increasing cost of production with disproportionate increase in farm-gate prices, low productivity, land subdivisions and short land leases that cannot support modern technologies such as Conservation Agriculture.

It added that the Government under BETA is fully addressing these challenges, for example through the subsidized fertilizer programme, enforcement of minimum guaranteed prices, e-Extension services, soil testing and improved seed varieties.

Data from the Kenya National Bureau of Statistics (KNBS) indicated that the value of imports from Russia reached Ksh 43.30 billion (US$ 290 million) in the first nine months of last year, up from Ksh 8.72 billion (US$ 58.35 million) during the same period in 2023, recording a 396.56% increase.