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How Cartels Are Making Fertiliser Expensive By Killing Cheaper Brands

[IMAGE/ COURTESY]

Being a farming nation, Kenya relies heavily on imported farming resources, fertiliser being on the list especially for maize farmers.

Just a month to planting season, the government announced that there would be no subsidised fertiliser as it has always been. The big question is: Is the government genuine?

Every year, Kenyans are treated to news of ‘fake’ fertilisers nabbed somewhere in the country. But after the news, where the fertiliser goes and the owners remains a mystery.

Kahawa Tungu however learns that it is not fake fertiliser, but the arrests are instigated by cartels in the industry so that they ride solo in the market with hiked prices. Through this, they fetch as much as Ksh2 billion from sales.

The latest nab was for 3,500 tonnes of fertiliser worth Ksh300 million last year June on grounds that it had mercury.

The biggest cartel in the industry is thought to be Export Trading Group (ETG) of Dubai which has offices in Dar-es-Salaam and Nairobi.

For instance, our source intimates that the price per 50kg bag of DAP fertiliser is Ksh2,800 from ETG warehouse in Mombasa. The same fertiliser of OCP which is impounded in Mombasa goes ksh2,300 per bag.

As a matter of fact, the planting season this year requires at least 200,000 bags of 50kg. The difference between ETG fertiliser and OCP fertiliser prices is Ksh500, hence for the 200,000 bags there is a mark up of ksh100 million before one talks of normal profit by these companies.

“So the OCP fertiliser has to be kept off the market by cartels that control Kenya Bureau of Standards (KEBS). False allegations of mercury in the OCP fertiliser is the weapon of choice at this time. The cartel will not allow retesting because they know there is no mercury in the OCP fertiliser. People at DCI and DPP are either part of the scam to keep cheaper fertilser off the market or they have been blind sided or they are too embarrassed by the dramatic Friday evening arrests and the outrageous charges that they find it hard to eat humble pie,” says a source in the know.

Kahawa Tungu understands that samples taken by KEBS seven months ago have been ‘lost’/ destroyed. Also, the DCI and the DPP are resisting the direction of the Court to take new samples and retest from the fertiliser in Mombasa.

“Is it an intention to delay the entry of this cheaper fertiliser from one of the world’s biggest manufacturer so that the cartels and middlemen of Kenya get a chance to sell their more expensive fertiliser to government and helpless Kenyan farmers?” poses a concerned party.

As compared to Kenya, 50kg DAP in Ethiopia sells for USD20 (ksh 2000) despite being a landlocked country. In Tanzania the same sells for Ksh2,400. A

ETG in Tanzania sells the same fertiliser at Ksh2,400.

In Kenya the ‘discounted’ price stands at Ksh3,000. In the open market today brands like Fanaka are selling at between Ksh3,200 and Ksh3,800.

Read: How SBM Fraudulently Acquired Billions From Fallen Chase Bank, Doctored Figures

In the meantime the price to Ministry of Agriculture given by ETG has been above Ksh3,000. The government had bought it at that price over the last two years and then subsidised it by 50 per cent. The price at 50 per cent discount would have been Ksh1,500 but it is always at Ksh1,800 for farmers.

In the meantime the NCPB does not even have with them the money accruing from sale at 50 per cent which was supposed to be a revolving fund.

Agriculture CS Mwangi Kiunjuri  asked for an additional Ksh3.68 billion for procurement of subsidised fertiliser when he appeared before the National Assemble Agriculture committee, but was unable to explain the whereabouts of the money.

Email your news TIPS to news@kahawatungu.com or WhatsApp +254708677607. You can also find us on Telegram through www.t.me/kahawatungu

Written by Francis Muli

Follow me on Twitter @francismuli_. Email francis@kahawatungu.com

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