Discussion Paper No. 313 of 2023 on Role of Beef Production and Marketing in Enhancing Welfare of the Communities in Arid and Semi- Arid Lands in Kenya

Abstract

The beef sector plays a significant role in the livelihoods of communities in Kenya's arid and semi-arid lands (ASALs). Despite the importance of beef production, ASAL communities continue to experience high poverty rates. By leveraging the sustainable livelihoods framework and employing Ordinary Least Squares (OLS) regression, this study analyses the relationship between beef production, marketing, and welfare in ASAL communities. Financial, social, and physical capital are important in improving welfare. With regards to beef marketing, commercial livestock farming households and paved county roads had significant negative correlations with monetary poverty. Aridity levels were also found to have a statistically significant influence on monetary poverty, implying the need for targeted policies that acknowledge the distinct economic and environmental conditions of ASALs. To enhance access to formal financial services in ASALs, the recommendation is to establish strategic partnerships with mobile money providers and leverage innovative insurance products such as weather-indexed insurance. In addition, to strengthen commercial livestock farming, this study advocates the formation of cooperatives or associations among beef farmers in ASALs, aiming to bolster their bargaining power and broaden market access. Prioritizing investment in crucial transportation routes connecting beef-producing regions to markets is also imperative for optimizing the physical capital in ASALs. Finally, due to the correlation between high aridity levels and heightened monetary poverty, it is important to have targeted interventions based on aridity levels. Specifically, for purely arid counties, this study proposes the introduction of feedlot initiatives as a strategic approach to fortify beef production and marketing. This would provide a controlled environment for livestock production, thereby safeguarding cattle farmers vulnerable to climate-induced shocks.