KMT Kenya Climate Research

The Kenya Southern Rangelands Beef Value Chain

Harnessing opportunities for climate-resilient economic development in the semi-arid lands

This research focuses on the livestock sector in the Southern Rangelands of Kenya and aims to identify climate change impacts, adaptation options and opportunities for private sector investment in the beef value chain.

Why This Study is Important

Livestock contributes 12% to Kenya’s national GDP

Kenya’s livestock sector is vital to the arid and semi-arid lands (ASALs) of Kenya, and makes a major contribution to the economy of 12% national GDP.

Livestock support 38% of Kenya’s population

It is estimated that 80% of Kenya’s livestock are found in the ASALs, which cover about 89% of Kenya’s land surface and support 38% of Kenya’s population.

Increased demand for meat

In Kenya, the demand for beef and meat products is projected to grow due to a growing human population, increased urbanisation and a growing middle class.

Inadequate supply of meat

It is anticipated that Kenya’s domestic beef supply will not be able to meet the growing per capita demand on beef, with an estimated short fall of domestic beef supply of approximately 20%.

Climatic Risks

The ASAL livestock sector faces a range of risks due to its high vulnerability to climate change, with implications for increased poverty and reduced food security. This will require significant investment in the ASAL livestock sector to adapt to these climate risks.

We focus on the pastoralist livestock system in Kajiado County, where livestock are reared on communal or private land, and beef enters the burgeoning Nairobi meat markets primarily for domestic trade.

Contents of the Research

CHAPTER 1:
Background and Context

1.1 Introduction
1.2 Economic justification for selecting the sector
1.3 Climate change and variability: Risks
1.4 Context and study sites
1.5 Methodology

CHAPTER 2:
Step One – Mapping the Value Chain

2.1 Step One description

2.2 Kenya livestock value chain

2.3 Kenya Southern Rangelands Beef Value Chain: Kajiado County
2.4 Key constraints identified along the beef value chain
2.5 Tourism links to the beef value chain

CHAPTER 3:
Step Two – Assessing Climate Risk

3.1 Step Two description

3.2 Literature review of climate trends and shocks in Kajiado County, Kenya
3.3 Analysis of climate trends in Kajiado County
3.4 Quantitative survey results: producer level
3.5 Qualitative analysis of climate risk along the value chain

CHAPTER 4:
Step Three – Identifying adaptation and investment options

4.1 Step Three description
4.2 Discussion of adaptation options

CHAPTER 5:
Conclusions and Recommendations

5.1 Summary and conclusions from analysis of Steps One to Three
5.2 Recommendations

CHAPTER 6:
References

1.1 References

Methodology

The paper follows the Value Chain Analysis for Resilience in Drylands (VC-ARID) approach to analyse the beef value chain in the Southern Rangelands of Kenya, using a common-three step methodology:

Step One: Mapping the Value Chain

Map the value chain, including its actors and linkages, and identify key constraints.

Step Two: Assessing climate risk

Identify climate risks at each stage of the value chain.

Step Three: Identifying adaptation and investment options

Identify adaptation and private sector investment options for climate-resilient value chain transformation.

Step One: Mapping the Value Chain

Kenya’s livestock value chain

Step One maps the beef value chain, identifying the different stages and key actors within the chain, and the vertical and horizontal linkages.

Kenya’s livestock value chain is made up of three main red meat production systems;

  1. ASALs – Pastoral production: Approximately 80–90% of red meat consumed in Kenya is produced by pastoralists, either within Kenya or from neighbouring countries.
  2. ASALs – Private ranches: Another 2% comes from livestock raised on ranches.
  3. Highland – Dairy farmers: Dairy cattle also contribute substantially to national supply, and dairy farmers account for about 10–15% of Kenya’s red meat supply.

Livestock Sources

For highlands production, the chain is relatively simple, beginning with dairy smallholders, who sell livestock to local butchers or abattoirs, before the meat reaches the consumer. For the ASALs, the chain is more complex and involves pastoralists from both Kenya and neighbouring countries, and private commercial ranches. Commercial ranching is particularly apparent in Laikipia County, where a number of well- known private ranches are found, including Ol Pejeta, Borana and Sosian (Ndiritu and Said, in review). In the ASALs, livestock may pass through traders, cooperatives, ranches, domestic or export abattoirs, butcheries and retailers, before meat reaches the consumer. There are both domestic and export end markets. However, the Kenyan red meat value chain is primarily geared towards the domestic market.

Meat Export and Imports

The domestic market consumes approximately 99% of production

Small volumes of meat (1%) are exported by the Kenya Meat Commission (KMC), private meat exporters and individual ranches.

Livestock and meat exports have been minimal in recent years, at only US$ 4.7 million in 2011, with the majority of exports going to UAE(31%) followed by Somalia (21%) and Tanzania (14%) (KMT, 2014).

Although Kenya’s pastoralists account for the majority of Kenya’s meat supply (60–65% of the total), a significant portion comes from livestock from neighbouring countries (Tanzania, Ethiopia, Somalia and Uganda). Behnke and Muthami (2011) estimated that 22% of Kenya’s domestic beef, equalling 632,649 cattle, were imported into Kenya in 2009.

Kenya is a meat deficient country

Kenya is currently unable to meet its domestic demand for beef without imports from other countries and is a meat deficit country.

In 2012, there was an estimated shortage in domestic supply of 18% for cattle and 19% for sheep (KMT, 2014). As the demand continues to surpass the production of beef, Kenya has to increasingly rely on foreign imports to meet the demand. This demand is projected to grow due to increasing urbanisation and a growing middle class.

It is argued that the deficit is due to Kenya’s livestock and meat value chains being inefficient, unorganised and poorly managed, limiting Kenya’s competitiveness in the meat sector (KMT, 2014; USAID, 2012). If the value chain is not improved it will have to increasingly rely on foreign imports to meet this demand.

The Market

Meat may pass through a number of different channels depending on the quality and price of the meat

The meat trade and meat value chain is mostly carried out in Nairobi. Actors in the meat chain include meat traders, meat suppliers, butchery owners, as well as traders and retailers that deal with offal and heads.

Key constraints identified along the beef value chain

A summary of the major constraints identified from mapping the Southern Rangelands beef value chain

There is a disconnect between the pastoralists and the end market.

There are many actors (for example traders, middlemen and transporters) involved in a single transaction, creating high transaction costs. The producer bears most of the cost and receives the lowest profit margins.

Livestock marketing information is poor and pricing is not transparent.

Formal pricing mechanisms such as weighing scales are absent. This leads to a loss on the side of the seller to the advantage of the traders due to informal and speculative pricing

Limited fattening of livestock.

Limited fattening of livestock. There was limited evidence of livestock fattening groups to fatten livestock before sale and produce higher quality of beef for the market.

The slaughterhouses are mostly concentrated in Nairobi.

Cattle have to be trekked or trucked long distances to reach the end market and can lose condition en route. Producers lose much of the potential value of the animal to traders and other value chain actors.

Minimal value addition or diversification of the meat product.

This is incentivising the supply of low quality meat sold cheaply in the Nairobi end markets. There are limited meat processing facilities at slaughterhouses that constrain value addition.

Lack of a well-developed cold meat chain.

Lack of a well-developed cold meat chain. The lack of refrigeration of meat means it must be sold on the day of slaughter. This forces low price sales by the end of the day and can incentivise the production of low quality meat over high quality meat.

Absence of livestock marketing or trading groups.

There are few livestock marketing or trading groups to engage and inform producers on marketing issues.

Step Two: Assessing Climate Risk

Step two assesses climate risk along each stage of the value chain

Timeline of climate shocks for Kajiado County compiled from discussions with producers and traders in field sites and from literature sources

YearClimate shock and major observationsImpacts
2013/14Drought – Olameyu le Nkaresero (when people
migrated to Enkaresero in Tanzania)
Experienced in Magadi region, but not in Namanga.
Ewaso Nyiro and Ngurumani rivers dried up. People migrated to Tanzania. Livestock and crop diseases reported.
2009Drought – When the Matapato people
migrated to the Magadi area
The one that decimated cattle. Meto livestock migrated to Tanzania/Sonjo and Magadi Group Ranches.
Magadi – Matapato people migrated in.
2004/05DroughtCattle deaths.
Magadi – associated with bird flu, killed lots of doves and other birds.
Meto – when people migrated to Nairobi and Kamba land. Lots of associated conflicts as people migrated to far away regions
1999/2000Drought – Oshomoki Oldoinyo sampu –
Kamorora (when people migrated to Oldoinyo sampu – Kamorora).
Somali shifta were attacking people in the Shompole/Olkiramatian areas. Presence of a government relief/food aid programme.
1998El-Nino rains – Olari loo Nkariak (The year of
floods)
Destroyed roads and bridges. Human and livestock deaths due to flooding.
Diversion of the Ewaso Nyiro River. Livestock diseases.
Invasive plants spread.
1997Drought – ‘Pee edungo Enkare Ngiro’ (drying up of
the Ewaso Nyiro River).
Drying up of the Ewaso Nyiro River for the first time since the 1960s.
Lots of livestock deaths.

Historical changes in rainfall and temperature

The changes in rainfall and temperature reported above may help explain some of the trends in livestock populations reported which show a decline in cattle, but large increase in shoats in Kajiado from 1977 to 2014 (Ogutu et al., 2016).

Cattle are sensitive to fluctuations in rainfall, and as the rainfall decreases, there is a corresponding decrease in the number of cattle (Said et al., 2019). The opposite relationship is shown for sheep and goats. As rainfall decreases, there is a corresponding increase in the number of sheep and goats (Said et al., 2019). The general decline in rainfall shown in Kajiado between 1960 and 2014 may have thus favoured sheep and goats compared to cattle.

Step Three: Identifying adaptation and investment options

This section draws out the adaptation measures that were identified by value chain actors in Step Two to discuss specific options for promoting resilience at different stages along the beef value chain. These are options that address both climate risk and have an opportunity to upgrade and transform the value chain. Selected adaptation options were explored and deliberated with stakeholders to identify specific feasible options for public and private sector investment. These included a mixture of traditional pastoralist coping strategies, and more transformative adaptation options which would require public and/or private sector investment, and the correct enabling environment.

Adaptation options at each point along the value chain are summarised, along with the key stakeholder promoting adaptation, the major barriers or opportunities to implementation and the cost implications of the adaptation options. In the sections, we outline the main adaptation options that were concentrated upon in discussions with different stakeholders. We focus specifically on the private sector adaptation and investment options.

Recommendations

Maintaining mobility

Migration is a fundamental adaptation strategy used by pastoralists during drought. The Kajiado County government needs to maintain and protect specific areas for livestock grazing, as well as livestock corridors that facilitate the mobility of livestock.

Fodder production

Pastoralists and farmers, supported by public and private investments, should be encouraged to invest in hay and fodder production to provide pasture during drought periods. Pasture can be used for domestic herds or sold on to other livestock owners.

Breeding to maintain climate resilience

The public and private sector should support cattle breeding programmes that optimise a mix of climate-resilient and commercially attractive traits. In more arid areas, the most effective breeds will be those that are more heat tolerant rather than high performing commercially-oriented breeds.

Support to integrated livestock–wildlife conservancies

Support should be given to create and maintain community-oriented livestock– wildlife conservancies as areas that provide dry season grazing for livestock. Conservancies are horizontally and vertically integrated with the beef value chain, and can support all stages of the value chain.

More finance opportunities including access to climate finance and livestock insurance

Access to finance is a constraint to actors at all stages of the value chain. In particular, financial services should be better designed to cater for pastoral production systems to help producers and traders engage in activities such as hay production and fattening. The Kajiado County government should set up a County Climate Change Fund (CCCF) to finance climate change adaptation efforts, and a livestock insurance scheme to protect against drought-related mortality.

Encourage the formation of livestock marketing associations

Livestock producers and traders should be encouraged to form livestock marketing groups or associations to increase their participation in markets and their collective bargaining power. The Kenya Livestock Marketing Council (KLMC) and the Departments for Trade and Livestock should support producers and traders to form these groups, and provide capacity building and training on marketing and value addition.

Improved livestock pricing information

To avoid speculative pricing and enable better price negotiations between producers and traders, the Kajiado County government can improve livestock marketing infrastructure such as weighing scales. This should however be accompanied by a community sensitisation programme to understand any avoidance on the use of such infrastructure. Livestock marketing associations can also help to provide and share up to date information on pricing.

Improve early warning systems

Early warning systems play an important role in preparing communities for climate shocks. The National Drought Management Authority (NDMA) should establish early warning systems that are in a form that is easily accessible to producers and traders in the pastoral rangelands.

Improved cold room storage

Beyond the high-end meat channels, there is an absence of a well-developed cold chain and a lack of cold storage facilities during transportation, processing and at the end markets. The private sector should invest in cold storage to avoid meat losses and reduced prices for meat that has to be sold by the end of the day of slaughter, as well as to allow time for processing and value addition.

Value addition in the meat chain – especially using low quality meat

An opportunity that stood out in the value chain was the processing and value addition of low-quality meat that is especially prevalent during drought, into popular products such as sausages and smokies. This requires the upgrading of processing facilities and the purchasing of the necessary equipment so processors and butchers can develop new products for sale.

Development of more profitable private sector vertically integrated businesses

Pastoralist communities should be supported by the private sector to set up vertically integrated livestock enterprises. These link the opposite ends of the value chain and bring producers closer to markets and consumers. These enterprises can directly link producers to high quality end markets and thus provide them with greater profits and share of added value along the chain.

The Kenya Southern Rangelands Beef Value Chain

Harnessing opportunities for climate-resilient economic development in the semi-arid lands

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