Farmers are the backbone of any society or economy, producing essential food crops that sustain life and cash crops that contribute significantly to economic output through exports. Given their crucial role, one would expect farmers to be among the wealthiest members of society. However, the reality is that many Kenyan farmers struggle to grow their wealth despite their hard work. Why is this the case, and what can be done to make farming more profitable?

Challenges Faced by Kenyan Farmers

• Brokers and Market Access : Many farmers get the short end of the stick when brokers purchase their produce at low prices and sell it at a higher margin. This exploitation leaves farmers with minimal profits. Greater market linkages and direct access to markets are essential to help farmers achieve better prices for their produce.
• Scale and Cost of Production : Most farmers in Kenya operate on a small scale and often over-diversify, which prevents them from achieving the economies of scale necessary for profitability. To improve profitability, there is a need for farmers to increase their scale of production.
• Lack of Mechanization : Reliance on traditional farming methods reduces efficiency and profitability. Many farmers do not use modern agricultural machinery, which could significantly enhance their productivity and reduce labor costs.
• Lack of Business Planning : Many farmers do not manage their farms as businesses. Without proper planning and management, it is challenging to assess farm performance or identify areas for improvement. This lack of business acumen contributes to the financial struggles of many farmers.
• Limited access to Quality Seeds and Inputs: Many farmers use low-quality seeds and lack access to appropriate fertilizers, leading to low crop yields.

Possible Solutions to Improve Farming Profitability

• Enhanced Market Linkages : Developing better market linkages and reducing reliance on brokers can ensure that farmers receive fair prices for their produce. This can be achieved through farmer cooperatives, digital marketplaces, and government interventions.
• Scaling Up Production : Encouraging farmers to scale up their operations and focus on fewer, more profitable crops can help them achieve economies of scale. Training and support programs can assist farmers in making this transition.
• Mechanization and Technology Adoption : Introducing modern agricultural machinery and technology can drastically improve farming efficiency and output. Mechanization can help reduce labor costs, increase productivity, and ultimately enhance profitability.
• Farm Management Training: Providing farmers with training on business planning, financial management, and record-keeping can help them run their farms more effectively. Understanding their costs, revenues, and profits enables farmers to make informed decisions and improve their financial outcomes.
• Access to Quality Seeds and Inputs: Establishing seed distribution networks and provision of subsidies or vouchers for high-quality seeds and fertilizers will improve the farm output. This will in-turn increase income to farmers.

How EFKen Leasing is Helping Farmers

As Kenya’s leading asset finance provider in the agricultural value chain, EFKen Leasing is dedicated to supporting farmers in overcoming these challenges. We offer flexible financing options for acquiring modern agricultural machinery, enabling farmers to embrace mechanization and improve efficiency. By providing access to the necessary assets, we help farmers scale their operations and increase their profitability.

Moreover, EFKen Leasing collaborates with farmers to explore innovative solutions and opportunities for scaling and efficiency. Our goal is to empower farmers with the tools and knowledge they need to transform their farms into profitable businesses.

The Role of Government

County and national governments also have a crucial role to play. By providing subsidies, infrastructure development, and extension services, governments can support farmers in adopting modern practices and accessing markets. Investments in rural infrastructure, such as roads and storage facilities, can further enhance market access and reduce post-harvest losses.

Conclusion

To make farming profitable and help farmers grow their wealth, a multifaceted approach is needed. By addressing the challenges of market access, scale, mechanization, and farm management, farmers can improve their productivity and profitability. EFKen Leasing remains committed to supporting farmers through asset financing and innovative solutions, ensuring they have the resources needed to succeed.

Joseph Kyama is a Finance and Administration Officer at EFKen Leasing.