Farmers are expected to benefit from enhanced financing if a proposed legislation is approved by the National Assembly.

Legislators reviewed the draft Commodities Fund Bill which seeks to establish the Commodities Fund to provide better financing options for farmers and promote the development of agricultural commodities.

In a meeting chaired by Hon. Dr. John Mutunga, Members of the Committee on Agriculture and Livestock interacted with the Board of Trustees and Management of the Commodities Fund, led by Mr. Duke Mainga, to discuss the proposed Commodities Fund Bill.

According to the proposed Commodities Fund Bill, the new fund would help farmers access affordable credit, and resolve gaps in the existing Crops Act, particularly regarding overlaps in lending to farmers, corporate status of the Commodities Fund and sources of funding.

During the meeting, lawmakers discussed the shortcomings of the regulatory framework, particularly the Crops Act, which is unclear on the composition of the Board of Trustees, and the recruitment and tenure of the Managing Trustee. Additionally, there is lending duplication leading to over-indebtedness as the Agriculture and Food Act has authority over the fund.

Despite these challenges, Members of the Committee on Agriculture and Livestock learned that the Fund had made some progress in supporting the agricultural sector. For instance, the Fund had mobilized seed capital for new strategic commodities such as coconut, cashew nuts, bananas, and miraa. The Fund has also made cumulative disbursements of KES 3.8B for Coffee and KES 4.8B for Sugar from 2014 to March 2023, with Coconut farmers receiving 12.5M in 2022.

During the meeting, Hon. Yusuf Farah asked why the Fund had not introduced a Sharia-compliant funding product for Muslim farmers. The Chairman of the Board of Trustees assured the legislators that the Fund is exploring new initiatives to support the agricultural sector, such as developing a Sharia-compliant product for the Muslim market.

Members of the National Assembly Committee on Agriculture and Livestock acknowledged the importance of strengthening the regulatory framework to ensure effective and sustainable support to the agriculture sector. The proposed Commodities Fund Bill, if approved, is expected to provide farmers with enhanced financing options and promote the development of agricultural commodities.

Members present during the meeting are Hon. Dr.John Mutunga, Hon. Brighton Yegon, Hon. David Kiplagat, Hon. Patricia Njoki, Hon.Ferdinand Wanyonyi, Hon.Yusuf Farah, Hon. Patrick Kibagendi Osero, Hon. Lawrence Mpuru Aburi and Hon. Peter Salasya.