LVFRP, 1999a; Mitullah, 1999). Generally, the factory provides transportation from the landing beach and ice, but does not take possession of the fish until it arrives at the factory and has been graded. Factories may also buy direct from fishers, by-passing the agents, particularly where a cooperative is well organised to market fish<sup>23</sup> . In these cases the fish may be transported in the cooperative’s own vehicle or a vehicle may be leased to the cooperative. Although relatively rare, some factories own their own vessels and employ fishers directly.

A number of processors provide financial support to agents, for example in the form of cash advances to purchase fish. They may also supply fishing equipment to fishers through agents in a bid to establish sole supplier relations. The typical agent can handle three to five tonnes of fish in a day and earns commission of around 10 percent, as the difference between the purchase and selling price (Abila and Jansen, 1997). In many cases factories have a long-standing relationship with their agent. Although there is no formal written contract, there is generally prior agreement on the delivery price and size and quality of fish.

The rapid growth of the industrial fish processing sector was motivated by the high and rising demand for Nile perch in exports markets, particularly within the EU. However, after peaking in the mid-1990s, exports began to diminish because of difficulties relating to the supply of Nile perch and fish quality (Bokea and Ikaiara, 2000). It is estimated that the sector as a whole was operating at 55 percent of its 380 tonne/day capacity in 1997 (Abila and Jansen, 1997), of which three factories accounted for over half of total operating capacity (Figure 9).

Although fish processing plants continued primarily to handle Nile perch, some started to process tilapia for export towards the end of the 1990s (Abila and Jansen, 1997). There was also consolidation in the sector and a number of operators established sister factories in Tanzania and/or Uganda where the supply of fish has been more plentiful. Until recently, these were used in part as a source of supply of raw or semi-processed fish for their Kenyan plants (Mitullah, 1999).

The major on-going issue for the sector is the landed supply of Nile perch. It is evident that the rapid expansion of the Nile perch fishery is not sustainable. Indeed, catches have tended to decline despite continual increases in the fishing effort. This has been exacerbated by the rapid spread of water hyacinth that has rendered some landing beaches inaccessible. Initially these supply problems were overcome by sourcing outside of Kenyan waters. Indeed, until recently there was evidence of significant ‘informal’ or ‘undocumented’ exports of fish from Tanzania and Uganda (Reynold _et al_ ., 1995).

In an effort to secure supplies of raw fish from Kenyan waters, some processors have extended their provision of credit or nets and other gear to fishers, through their agents (Abila and Jansen, 1997). In some cases, they have built bandas, storage facilities and even jetties at landing beaches in order to create leverage in the local marketplace. Others have invested in motorised boats to collect fish and deliver to insulated vehicles. It is evident, however, that these efforts have been less successful in Kenya than in Tanzania, where whole fleets of fishing boats have become established that supply a single factory(LVFRP, 1999a). In part, this reflects the better

> 23 Although this is more common in Tanzania than Kenya.

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