Table 13.2 Evolution of maize marketing and pricing policy reforms in Kenya, starting in 1988
Year State marketing agency
1988 National Cereals and Produce Board (NCPB) financially restructured. Phased closure of NCPB depots. NCPB debts written off; crop purchase fund established but not replenished.
Year 1988
Market regulation and pricing policy Cereal Sector Reform Program envisaged
widening of NCPB price margin. In fact, margin narrowed. Proportion of grain that millers were obliged to buy from NCPB
declined. Limited unlicensed maize trade allowed.
1991 1992
1995 NCPB restricted to limited role as buyer and seller of last resort. NCPB market share declined to 10–20 percent of marketed maize trade. NCPB
operations confined mainly to high- potential areas of western Kenya.
1993 1995
1996 1997
1997 onward 2000 onward 2005 onward Further relaxation of interdistrict trade.
Restrictions on maize trade across districts reimposed. NCPB unable to defend ceiling prices.
Full liberalization of internal maize and maize meal trade; maize import tariff of up to 30 percent reimposed.
Export ban imposed after poor harvest. Import tariff imposed after poor harvest.
External trade and tariff rate levels changed frequently and became difficult to predict. NCPB producer prices normally set above import parity levels.
NCPB provided with funds to purchase a greater volume of maize. NCPB’s share of total maize trade rose to 25–35 percent of total marketed maize.
The government withdrew the maize import tariff from maize entering Kenya from East African Community member countries. An official 2.75 percent duty was still assessed. Variable import duty still assessed on maize entering through Mombasa port.
Source: Adapted from Ariga and Jayne (2008).
African Community (EAC) to eliminate cross-border tariffs within the region and harmonize regional and international trade policies.
Investment in Seed Technology and Market Development The release and dissemination of improved maize seed varieties has been another important dimension of Kenya’s success in input intensification. Suri (2007) docu- ments the release of at least 10 new maize hybrids or open-pollinating varieties released since 1995 by KARI and other firms. Hassan, Mekuria, and Mwangi (2001) show a fivefold increase in the number of private seed companies between 1992 and