KENFAP decided to focus on only one priority policy research issue involving a critical assessment of government interventions in input and output markets: a case of Maize seed, Fertilizer and Maize grain. The aim of the study was to determine the impact and sustainability of the interventions involving delivery of subsidised fertiliser and certified seeds to smallholder farmers and outline relevant policy recommendations. Due to the funding constraints, the involvement of local researchers in the study was substantially scaled down and KENFAP staff undertook most of the activities, including carrying out desk review of existing literature, developing research instruments as well as collecting and analysing data. NRI provided advisory and editorial inputs to KENFAP.

Preliminary results from the study provided interesting indication, including: very few of the target smallholder farmers benefited from the programme; the increase in yield and output reported by participating farmers cannot be sustained if the grain marketing system is not simultaneously improved to enhance profitability of inputs use; and there are doubts about the sustainability of the programme, especially as it appears to undermine private inputs distribution systems in the country. The results of the study are to be validated at a planned stakeholders’ workshop, during which specific policy recommendations will also be discussed. Participants will include other farmers’ organisations as well as representatives of private sector organisations and other policy organizations. Following the validation workshop, evidence-based policy advocacy documents will be produced for dialogue with government, in particular through the Kenya Private Sector Alliance (KEPSA) as well as the Prime Minister’s Quarterly Round Table and the biannual Presidential Forum. KENFAP is the chair of the KEPSA Agriculture Sector Board. The cost of these activities is to be funded under a contract between LEI Wageningen and KENFAP, which has been signed on 1^st December 2010.

Following a review of agricultural markets dynamics in Kenya and in response to demand from its members, articulated during consultation meetings in August 2010, KENFAP has revised its priority thematic areas to be supported by research under ESFIM. The two main areas:

1) Improving produce marketing by smallholder farmers through Warehouse Receipt System (WRS) and related contract farming that will influence the design of the WRS and how it is regulated and intends to commission a study to produce the required evidence-based knowledge for its position paper. This is linked to an ongoing study, being undertaken jointly by KENFAP and Wageningen University (WUR), with co-funding from the Dutch Embassy, involves exploring the potential for promoting contract farming as a means of improving access to stable and remunerative markets for smallholder farmers. The outcome of these study will be shared during a workshop to be organised during the first half of 2011.

2) Improving access by smallholder farmers to financial and insurance services and secure output markets: A local consultant will be engaged to conduct a survey to identify impediments hindering smallholder farmers’ access to credit for production and marketing as well as to insurance products. The consultant will also review existing programmes such as credit guarantee schemes and analyse hidden costs embedded in bank loans and participation in microfinance schemes.