Kenya: Tobacco Farming Hit As As Firm Quits Migori

Source from:  The Star 06/11/2015

TOBACCO farmers and ancillary traders in Migori county are counting losses after Alliance One Tobacco Kenya which accounts for more than 52 per cent of contracted farmers in the region stopped operations.

The exit has left more than 10,000 farmers in Migori and Kuria stranded and are now exploring other cash crop options

The most affected region is Migori where farmers will lose more than Sh1.2 billion they earn from tobacco sales annually.

The closure has rendered more than 200 casual and permanent staff at the company jobless. The company operated major leaf buying centres in Migori, Uriri, Kehancha and Isebania towns.

"We have closed shop and everybody including managers, accountants, leaf technicians and drivers are jobless," said Patrick Kimani, who was the head of leaf department Kenya.

Farmers in Migori which, accounts for the country's 70 per cent production are also awaiting a Sh54million bonus from the firm, according to of Kenya Tobacco Farmers Association.

Ketofa chairman Augustine Mwita said yesterday the demand for the crop has been declining internationally.

"We are faced with a bleak future in the sector, because even though Alliance One is currently paying us our dues, farmers are not sure if they should plant the crop," Mwita said.

He said the closure of the firm follows years of reduction of leaf buying with another firm British America Tobacco completely reducing its presence in Migori and leasing out their structures to other firms.

Mwita said Mastermind Tobacco which also once operated in the area still owes farmers Sh100million in arrears.

Unlike the two, Alliance One Tobacco Kenya does not make cigarettes and associated products but exports processed leaf to Europe and other parts of the world.

"When Alliance One paid farmers we knew we had bumper profits as we stocked our goods in line especially with bonuses," Bonny Chacha, a trader at Mabera town said. Enditem