Improving Kenya's Domestic Horticultural Production and Marketing System: Current Competitiveness, Forces of Change, and Challenges for the Future - Volume III: Horticultural Research And Input Sector Regulation In Kenya And Tanzania

Abstract

Executive Summary Kenya’s horticultural sector (defined here to include fruit and vegetable production and marketing, but not flowers) has received a great deal of attention over the past decade due to the rapid and sustained growth of its exports to Europe. This impressive growth has undoubtedly contributed to increased rural incomes and reduced rural poverty in Kenya. Yet despite this growth, exports remain a small fraction of Kenya’s overall horticultural sector. For the past decade, over 90% of all fruit and vegetable production was consumed domestically, and the domestic market accounted for over 90% of the total growth in quantity of fruit and vegetable production. While over 90% of smallholder farmers in all but the arid regions of Kenya produce horticultural products, fewer than 2% do so directly for export. This overwhelming dominance of the domestic market, combined with slower growth experienced in the export sector over the past decade, the challenges that smallholders face to continue participating in the export sector, and the possibility of more rapid growth in domestic demand, all argue for a more active focus on the potentials and constraints of domestic horticulture in Kenya. Such a focus implies also the need to assess the competitiveness of local production and marketing against that of neighboring countries such as Tanzania and Uganda. This paper explores these key issues in three Volumes. The overall objectives of the three Volumes are to provide a broad diagnostic overview of the horticultural sector, to identify specific constraints that limit the system’s performance, to make suggestions for selected policy and programmatic changes, and to identify key research that needs to be done to guide further investments to improve sector performance. Volume III – the present volume – focuses on horticultural research and input sector regulation, comparing and contrasting the system in Kenya with that in Tanzania. Volumes I and II focus, respectively, on horticultural production in Kenya and on domestic and regional marketing of horticultural products. The paper is organized as follows. Chapter 1 provides background and briefly discusses the data and methods used in the report. Chapter 2 evaluates the market and regulatory system for vegetable seeds. Chapter 3 reviews the horticultural research and development systems in Kenya and Tanzania, while Chapter 4 looks at fertilizer and agrochemical inputs for horticulture. Finally, Chapter 5 presents conclusions and recommendations. Market and Regulatory System for Seeds: Following liberalization in 1994, government in Tanzania has played a facilitating role in seed sector development, while the focus of Kenya’s authorities is primarily on regulation and “policing”. Community Based Seed Production, especially of the mang’ola red onion variety, and local varietal development more generally, appear to be major successes of this more flexible approach in Tanzania. Horticultural Research and Development: Horticultural seed research in Kenya is plagued by under-staffing. While Tanzania’s research center has five vegetable breeders, a number of seed technologists, and a fully operational seed production unit, Thika Research Center in Kenya has one full-time breeder, no seed technologist, and no operational seed production unit. Fertilizer and Agrochemical Inputs: Kenya Farmer’s Association and National Cereals Produce Board (a parastatal) have both become active in the fertilizer sector since 2001. They charge lower prices than private companies and some suggest that their presence has reduced the prices these companies charge. This development needs to be watched quite vi closely to ensure that unsustainable government subsidies to NCPB or KFA do not undermine the notable success of fertilizer sector liberalization in Kenya. Conclusions and Recommendations: Fresh fruit and vegetable production and marketing value chains are becoming increasingly important to a broad array of Kenyan consumers. These also hold potential market opportunities for important segments of the smallholder farming community. Expanding domestic and regional markets for Kenyan horticultural produce and integrating the country’s smallholder farmers into profitable supply chains that satisfy these markets will require investment in three key areas: technical production constraints, “hard” and “soft” market infrastructure, and the legal and regulatory environment. Recommendations regarding the legal and regulatory environment (the focus of this Volume) touch on the current revision of the Seed and Plant Varieties Act of 1991, on the Horticulture Bill, and on issues of quality and food safety, farmer organizations, and intellectual property rights in seed varieties.