Deputy President Rigathi Gachagua has formed a task force to look into issues bedeviling the avocado sub sector.
This is after avocado farmers in Murang’a county differed with KRA officials on the mandatory Electronic Tax Invoice Management System (ETIMS) as stipulated under Section 23 A of the Finance Act 2023.
This scuffle promoted the DP to convene a meeting with avocado stakeholders and iron out the issue.
Members of the task force will include avocado farmers, aggregators, exporters and processors, officials from Ministries of National Treasury, Agriculture, Cooperative and Trade.
Gachagua said Members of Parliament will discuss on the particular clause and amend it to reflect the reality of the agriculture sector on the ground.
“There are issues in every document and we will talk to stakeholders and look for a first aid solution as we give MPs ample time to amend section 23A,” said the DP.
He said the task force will discuss and propose recommendations on all the issues raised by the value chain players, and have an actionable plan within 30 days so that activities of the sub sector do not stall.
Jeremiah Ng’ang’a, an avocado farmer from Murang’a and chairman of the Kenya Avocado Farmers Association said avocado farming is a lucrative business but smallsacle farmers, who constitute 70 percent of the producers do not feel the economic power or full gains.
Ng’ang’a has been able to increase from 300 avocado trees to 1,800 trees since 2022 when his farm in Kigumu was declared the best orchard in Kenya during the Avocado Excellence Awards.
He said middlemen/brokers have been a big impediment for farmers to enjoy the full benefits of avocado farming despite increased domestic and global demand.
“The increase demand has led to growth in exports but there is low producer price because prices are dictated by the exporters and farmers have no say in this,” said Ng’ang’a.
“The business has been infuriated by middlemen/brokers and cartels. Currently a piece of avocado is selling at between Sh3 to Sh5 yet the cost of production is high,” he said.
Cooperatives CS Simon Chelugui said the avocado sector has numerous challenges.
At the farm level, the sub-sector faces including inadequate availability of clean planting materials, pest and diseases and that Kenya is already facing quarantine on the European market.
He added there is also inadequate research to develop better varieties and mitigation of pest and disease prevalence.
The harvesting of immature avocados is a major issue which is related to inadequate extension services.
“This is because if farmers are sensitized, they would harvest on time. Another challenge is poor postharvest handling of the fruit. If you travel around the avocado growing counties, you will find a lot of avocados on the highway and markets being exposed to the sun and that reduces the quality of the produce,” he said.
The CS added that non- compliance to handling and quality requirements by some traders especially when transporting in crates or packaging in respective sizes among others.
“We are talking on the sidelines of a recently signed economic partnership agreement . We have opened our country to over 600 million people in 27 countries in Europe and we have a huge opportunity if we handle this well,” said Chelugui.
On the domestic market, the CS said there is low avocado household demand of 250g/day. There is also high perishability of avocado leading to high post-harvest losses, low avocado value addition initiatives and opportunities, and lack of linkages to possible off-takers in local markets.
The other challenge is the international export market which Chelugui said the Ministries of Trade and Cooperatives will be working together to explore traditional and new markets.
“We also faced with the high cost of freight, the current situation in the Red Sea necessitating shipment to Europe through South Africa, which is also more costly. This is in addition to highly competitive market in the Europe and stringent market requirements (SPS),” he added.
The CS noted that despite India and China markets being open, these countries require fumigation of the fruits with Methyl Bromide which is costly.
“The shelf life of fumigated fruit is also reduced. This is another issue that the Ministry of Trade will be helping to unlock,” he said.
Chelugui also pointed out that India charges 30 percent custom duty on Kenya avocado exports since Kenya is categorized as a developing country, while least developed countries like Tanzania are not being charged the same.
“This makes Kenyan produce less competitive in the Indian market,” said the CS.
He said one of the proposed interventions is to increase production from the traditional 32 counties led by Muranga to the non-traditional producing regions.
“We have other counties that have potential for instance avocado and macadamia farming can be embraced in coffee growing regions. We also need to invest on research and development especially on avocado rootstock that is tolerant or resistant to root rot. Support establishment of packhouses/processing facilities close to production zones,” Chelugui said.
Christine Chesaro, acting director, Horticulture Crops Directorate said export earnings in the 2023 were Sh157 billion.
She said Kenya is among the significant producers and exporters of horticultural produce globally, and that the annual foreign income from the export horticulture produce is steadily growing at an average rate of five percent per annum.
The horticulture sector is regulated under the Crops Acts of 2013, the Agriculture and Food Authority Act of 2023 and the Crops (Horticultural Crops) Regulations, 2020.
The Horticultural Crops Directorate (HCD) under the Agriculture and Food Authority (AFA), is charged with the responsibility of developing regulating and promoting the horticulture sector.
According to HCD, the top horticultural export destinations in 2023 were; the Netherlands (27%), United Kingdom (14%), France (13%), United Arab Emirates (5.8%), Germany (5.1%) and Monaco (4.6%).
The Netherlands, United Kingdom, France, United Arab Emirates and Germany have remained the most important destinations for Kenya’s horticultural products export for four consecutive, years accounting cumulatively for over 65% total market share annually.
“Horticulture export quantities have steadily increased from 121,068 MT in 2002 to 468,438 MT in 2023. This has been matched with a corresponding rise in value of Sh 26.7 billion in 2022 to Sh157 billion in 2023,” said Chesaro.
Currently more 32 counties in Kenya are producing avocados. Kenya’s production was 518,500 MT in 2023 over an area of 29,150 Ha.
The leading county in production was Murang’a, accounting for 23.2% by value of produce followed by, Nakuru (12%), Kisii (11%), Kiambu (9%), Nyamira (5%), Meru (4%), Uasin Gishu (4%) and Bomet (3%).
Kenya is the number one exporter of avocado in Africa and number six in the world after Mexico, Colombia, Peru, Indonesia and Dominican Republic.