Nairobi Star (Nairobi)
Lola Okulo
14 December 2011
Beer production will be uninterrupted next year despite produce losses accrued by barley farmers due to drought after the farmers were yesterday paid Sh40 million to cover the loss. CIC Insurance Group which is in a tripartite agreement with East Africa Maltings Limited which contracts the barley farmers to supply the raw material for beer and Cooperative Bank said the payout will help the farmers prepare for the next planting season.
East Africa Maltings is a subsidiary of alcohol manufacturer East Africa Breweries whose beer products dominate the local market. “The farmers have been victims of the current variances of weather and some of these farmers are suffering from reduction in crop yield,” noted CIC General Manager for General Business Kenneth Kimani.
Although the scheme covers over 500 farmers, only 50 out of these-most of them from Narok- are subject to compensation as per the extent of the loss suffered. To qualify for a crop insurance cover under the tripartite agreement, a farmer must be growing barley on a minimum of 14 hectares of land.
Under the agreement, CIC Insurance compensates farmers if their production falls below 6.5 bags of barley per acre. Co-op bank had lent out a total of Sh500 million to the barley farmers in the current crop season. Kimani added that the firm is counting on the payout made to showcase to farmers that crop insurance is important so as to grow this niche market. The firm has so far covered 25,000 hectares of crop land out of which an estimated 20,000 hectares is for barley farming.
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