Fresh Vegetable Market in Kenya - Fresh Fruits, Vegetables, Avocado's and Beans
The Embassy of the Kingdom of the Netherlands has (co-)funded studies on fruits & vegetables to provide businesses with relevant insights and information on value chains, regulations, consumer trends and more related to Agri-Food and agribusiness opportunities. Of course, we want to make these studies available to you so that you can use the information to grow your business. Below you find several studies highlighting what there is to know about fruits & vegetables in Kenya in general, and beans & avocados specifically.
Study 1: The Fresh Vegetables Market in Kenya (2016) - carried out by Research Solutions Africa
The wholesale and retail trade sector is identified by the government of Kenya as one of the six priority sectors in the economic pillar of Vision 2030, the long-term strategy for Kenya to become a middle-income country by 2030. At the same time, the Government of the Netherlands identified Agri & Food as a so called top sector to be further developed, both nationally and globally.
The Embassy of the Kingdom of The Netherlands in Kenya has a key role in providing assistance to Dutch agribusinesses investing in Kenya as well as engaging in support programmes that promote food security in the country. Therefore, to increase understanding of the retail food sector, the Embassy has embarked on coordinating a study on this sector in Kenya. The key objective of this study is: to provide the Dutch agro-food sector with insights into the Kenyan retail food industry and investment opportunities therein.
Agriculture is the backbone of the Kenyan economy with an annual direct and indirect contribution to the GDP of 24% and 27% in 2011, respectively. Horticulture is among the leading contributors to the Agricultural GDP at 36% and continues to grow at between 15 and 20% per year.
The horticultural sector is among the leading foreign exchange earners and contributes enormously to food security & household incomes to a majority of Kenyan producers who carry out one form of horticultural production or another. The industry employs over six million Kenyans directly and indirectly. Of the total horticultural production, about 95% is consumed or utilized locally, while the remaining 5% is exported; yet in terms of incomes, the export segment earns the country huge amounts of foreign exchange. For example, in 2011, the industry earned the country KES 91.2 billion from exports.
The horticulture sub-sector is made up of five commodities; vegetables, flowers, fruits, nuts and; medicinal and aromatic plants (MAPS). Of the total value of horticultural produce, vegetables account for 44.6%, fruits 29.6%, flowers 20.3%, and nuts, medicinal and aromatic plants account for the rest. The vegetable sub-sector is important in attaining food security and improving livelihood for smallholder farmers who produce 100% of the African vegetables and up to 70% of the Exotic and Asian vegetables. The major vegetables produced in Kenya are: Irish Potatoes, tomatoes, cabbages, snow peas, kales, spinach, runner beans, French beans, carrots, broccoli, indigenous vegetables, and Asian vegetables. In terms of enterprise value per acre, tomatoes are the most lucrative, followed by cabbages and French beans (see below).
Several factors hinder the potential of the industry. These include multiple taxation regimes, low incentives in terms of local market prices, high costs of inputs as well as water, energy, and the cost of air freight, and a generally unregulated environment leading to produce poaching and lack of quality control for local produce. Agro-processing, packaging and quality standards in the domestic market are also not fully developed. There is need to invest in better production methods, post-harvest care and quality to improve consumer acceptance of produce in order to earn higher value.
- Agro-processing and packaging technologies are relatively underdeveloped in Kenya. Deliberate efforts need to be made towards investing in this area to increase produce shelf life, reduce post-harvest losses, and improve consumer acceptance.
- The activities of government agencies involved in regulating the industry are not harmonised and lead to delays and increased cost of compliance.
The Study exists of 3 parts:
- Is a Desk Review on: the regulatory environment of the Agro-Food Chain, the actual Value Chain itself from farmer to retailer; Relevant Policies, and finally recommendations for foreign producers. See: Fresh Vegetables Market in Kenya - Part 1 - Desk Review
- Is a Retailers Survey and answers the questions where Kenyan Supermarkets source their fruits & vegetables from. It also identifies the most important stakeholders and talks about waste & post-harvest loss. See: Fresh Vegetables Market in Kenya - Part 2 - Retailers Survey
- Is a Consumers Survey identifying the most important statistics, consumption patterns, trends and new niche markets. See: Fresh Vegetables Market in Kenya - Part 3 - Consumers Survey
Study 2: The Bean Value Chain in Kenya (2012) - Carried out by SNV
This study describes the green bean value chain in Kenya. It offers a sector description & analysis, depicting the current state of affairs and efforts that could be made increase the competitiveness of the sector.
The major opportunities highlighted in the study included: Market Development & Market Information and Technology, Innovation & Product Development
Follow the following link for the full study: Bean Value Chain Analysis Kenya 2012
Study 3: The Kenya Avocado Commodity Business Plan (2013)
In July 2013, the Centre for the Promotion of Imports from Developing Countries of the Netherlands (CBI) and the International Trade Centre (ITC) signed a partnership agreement, creating the Export Sector Competitiveness Programme also called Netherlands Trust Fund phase III Programme (NTF III).
The "NTF III Kenya - Enhancing Export Competitiveness of the Avocado sector in Kenya" project builds on and will support the implementation of the avocado business plan. The envisaged outcome of NTF III Kenya Avocado project is to enhance the export competitiveness of the avocado sector in Kenya and generate new export revenue.
The focus of the Avocado Commodity Business Plan is to address the rapid loss in market share and to establish a stronger commercial presence in European markets in particular but also in Gulf countries. In order to achieve this, the business plan focuses on supply side consistency requirements, responding to growing standards and changing market requirements, as well as introducing marketing and promotion related activities. The business plan’s objective is to raise exports from Kenya, reduce erosion of market shares and increase smallholder revenues. The business plan is geared towards a ten-year strategic plan, although the plan of action is only detailed for a period of 5 years with the need for a mid-term evaluation and re-alignment of priorities in 2020.
For more information about this sector or any other agricultural questions feel free to contact us via nai-lnv@minbuza.nl. For the latest updates on activities, new articles and more follow us on twitter on @NLAgiKenya and subscribe to our newsletter by sending us an email. In case of any non-agriculture questions for the Netherlands Embassy in Nairobi see, this website for contact information.