Agriculture


OVERVIEW

Agricultural Sector
Agriculture in Kenya is the backbone of our economy. Indeed it is, given its significance in influencing economic growth. It is known from various studies that 1% growth rate in agriculture translates into a growth in overall economy (GDP) of up to 1.2%. Kenya’s own studies have verified the same as per the given example. In fiscal year 1986/87 the growth rate in agriculture was 3.8% and that of GDP was recorded at 4.9%. In 1989/90, agriculture growth rate was 3.4% while that of GDP in the same year was 4.5%. When the agricultural growth dropped to – 1.1% in 1990/91, the GDP dropped drastically to 2.1%. The continued slump in agricultural growth has continued to dampen any growth in the economy to date. (Agricultural Sector Review 2000). It is therefore, important to focus on agriculture for any meaningful development in Kenya.

Land Resource & Utilization
Kenya’s total area is about 587,000 sq km of which 576,076 sq km is land and 11,230 sq km is covered by water. Of the total land area 16% is a high to medium potential. The rest is arid and semi-arid and therefore of low agricultural potential. Out of the ASAL’s 48 million Ha, 24 million Ha is only useful for nomadic pastrolism, the rest can support some commercial ranching and irrigated agriculture but with a lot of physical infrastructure input.

The critical farming characteristic is that 5 million people live and derive their livelihoods in ASAL areas, the rest of the population is in the 16% of the land area. In a country where 80% of the population depend on agriculture, the high and medium potential areas have been reduced to small scale farms of up to 0.5 – 10 ha. Infact, 81% of small-scale farmers occupy holdings of less than 2 ha. With the population growth rate of 3.2%, the pressure on land will continuously reduce the capacity to sustain food production and cash crop farming.

Food Security & Vulnerability
Kenya is broadly self sufficient in major food items except in drought years. Chronic vulnerability is concentrated in the ASAL areas. Up to 5 million people are vulnerable and require humanitarian assistance from time to time. Special attention is being given to these areas in terms of specific projects, which include provision of water and preservation of traditional drought management systems.

Agricultural Growth & Environment
Demographic pressure and use of technology in agriculture is exacerbating pressure on environment especially in areas of soil erosion, deforestation and water pollution.

The core functions of Ministry of Agriculture:


AGRICULTURAL EXPORTS

Tea
This is Kenya’s leading export crop. It is reputed world over for its consistent high quality throughout the year.

Key Organisations in the Tea Industry
1) Tea Board of Kenya (TBK):

A government parastatal charged with the overall function of regulating tea industry. Some of the responsibilities include:-

For more about Tea Board of Kenya, please visit the website (http://www.teaboard.or.ke/).

2) Kenya Tea Development Agency:

This is the apex organization (agency) for all small-scale tea growers in Kenya. It accounts for almost 60% of Kenyan and 6% of global tea production. Currently it has 51 tea manufacturing factories under its management. Each factory has a capacity of about 3 million kgs of made tea per year with total output capacity of about 156 million kgs per annum.
For more information about KTDA tea processing, grading and marketing, please visit the website: www.ktdateas.com.

3) Kenya Tea Growers Association:

This is the apex organization of large-scale tea producers in Kenya. The principal functions of the association are:-
To promote issues of common interest in cultivation, manufacture and marketing of tea.
To promote good industrial relations by ensuring sound wage policies and good labour relations.

4) Other organizations in the tea sub-sector are:

(1) Kenya Tea Packers
(2) East African Tea Trade Association

Information about them in TBK website.

Horticulture

This comprises the production of fruits, vegetables and flowers. The average annual growth rate of 20% in the sub-sector underscores the demand of our high quality produce in the world markets. The sub-sector is mainly private sector driven. It employs about 2 million people and accounts for up to 21% of agricultural exports.

Key Organizations in Horticulture
Horticultural Development Authority (HCDA)

This is a parastatal established under agricultural Act CAP 318 of the laws of Kenya. The authority is vested with the responsibility to develop, promote, coordinate and regulate the horticultural industry in Kenya.

The mandate is to:-
- Regulate
- Provide advisory services
- Provide market intelligence information
- Assist in marketing on cost recovery basis

It has cold rooms and pack houses, transport trucks and pre-cooling facilities for use by stakeholders particularly small-scale growers.
Website: www.hcda.or.ke

Kenya Flower Council (KFC) & Fresh Produce Exporters Association (FPEAK)

Their main roles are to promote activities of their respective members in development of quality assurance through implementation of codes of practise that ensure:-

- welfare and safety of employees
- pesticide use
- environmental concerns
- standards (quality & quantity)
- others

Website: www.kenyaflowers.co.ke

Other organizations:
Kenya Plant Health Inspectorate (KEPHIS) www.kephis.org

Coffee

Coffee is important in Kenyan economy due to its contribution to foreign exchange earnings, farm income, employment and food security. It is also a source of livelihood particularly for small-scale producers most of whom live in the heavily populated agro-ecological zones. In terms of foreign exchange earnings it ranks fourth after tea, horticulture and tourism, contributing about 20% of total export earnings. Kenyan coffee is known for its high quality.

Key organizations in coffee industry:

Coffee Board of Kenya (CBK)
This is a parastatal charged with the regulation of the coffee industry. Specifically, its functions are:-

Other Organizations:
KPCU, Mild Coffee Trade Association of East Africa (MCTA), EAFCA and EACO

‘Grown Under the Sun’ – Protecting and promoting fresh produce exports

In recent years, concerns regarding climate change and global warming have grown and British industry is under pressure to reduce its impact on the environment. Air-freighting, as a carbon-intensive activity, has become heavily criticised and the concept of ‘food miles’ is now taken by many to be indicative of environmental sustainability.

The inference of ‘airfreight labelling’ schemes and ‘buy local’ campaigns is that produce with ‘food miles’ attached to them - having travelled a long distance to reach the consumer - have a larger ‘carbon footprint’ than food sourced locally. However, evidence does not support this claim and these initiatives are a potential threat to Kenya’s profitable horticultural export industry.

The horticultural industry in Kenya supports over 1 million people and horticultural imports from the whole of sub-Saharan Africa account for around only 0.1% of UK carbon emissions.

‘Grown Under the Sun’ aims to counterbalance the threat of the ‘food miles’ debate by communicating the following:

www.grownunderthesun.com

INVESTMENT OPPPORTUNITIES

Investment in agricultural sector in Kenya abounds. One can invest in agricultural support services, production and processing.

In agriculture support, opportunities exist in;
- seed production
- manufacture of sprayers and pesticides
- installation of irrigation systems
- services that enhance production of industrial crops such as oil seeds, barley, sugarcane, groundnuts.

In production for export, opportunities exist in;
- cutflowers
- various types of beans
- fruits (pineapples, mangoes, avocado, passion, melon) etc.
- asian vegetables

On agro-processing, opportunities exist in;
- Any palm oil substitute technologies (to take advantage of oil crops grown in the country such as groundnuts, sunflower, cottonseed, sesame, coconut, corn/maize etc.)
- Wine production
- Coffee; packaging, roasting, blending, decaffeination, gourmet
- Tea; packaging for direct sales to consuming markets
- Leather & leather products
- Milk and meat processing

<< back