ANALYSIS-Kenya's agriculture needs merged exchanges

Wed Mar 23, 2011 12:40pm GMT

* Agriculture contributes 25 percent to GDP

* Kenya has three fragmented exchanges

* Delivery threshold for maize farmers too high

By Beatrice Gachenge

NAIROBI March 23 (Reuters) - Kenya needs to consolidate its separate agricultural exchanges to increase the commodities traded and attract new ones, but it needs a new law to achieve that.

Supporters of reform say consolidation of the exchanges would lead to a four-fold growth in the turnover of the sector which underpins the economy of east African's largest economy, contributing about 25 percent to its gross domestic product.

Kenya has three privately-owned commodity exchanges for tea, coffee and some agricultural commodities.

Ethiopia and South Africa have the most active consolidated agricultural exchanges in Africa, which trade a mixture of commodities, and have helped trade in the sector to expand.   Continued...

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