Wednesday , 23 May 2018
Home » Agribusiness in Kenya » Macadamia: The next profit making frontier

Macadamia: The next profit making frontier

Kenyan coffee farmers who used to grow macadamia trees to shade their coffee bushes are now abandoning coffee in pursuit of macadamia farming. The East African nation, known for its prized Arabica coffee, is gaining a reputation for its macadamia nuts, with production rising to a record in 2017.

Expansion in the world’s third-biggest grower of the crop is being driven by demand from China, according to Nairobi-based agro-processor Nawiri Agribusiness EPZ Ltd. Farmgate prices for unshelled macadamia nuts have risen to as high as KES 180 a kilo this season from about KES 70 at the start in December, and may climb to KES 200, according to Alfred Busolo, head of Kenya’s State-run Agriculture and Food Authority. By contrast, many coffee farmers operate at a loss, with their beans earning about KES 55 per kilo, according to a report last year by London-based advocacy group Fair Trade.

Farmers are beginning to discover that this is gold, said Loise Maina, one of three founders of Nawiri Agribusiness. Wherever coffee is grown, macadamia also grows and farmers are now aware of the opportunity with macadamia.

Kenyan coffee production has dwindled after years of mismanagement by the industry regulator to 38,620 tonnes last year from a peak of 130,000 tonnes in 1989. Macadamia production increased five per cent to 41,614 tonnes last year, after growing more than 20 per cent over the preceding two years, according to the AFA. At current prices, last year’s macadamia crop was worth Sh7.49 billion.

Also Read  Tackling October- February Drought Using Drip Irrigation

The coffee industry earned KES 15.9 billion last year, according to the Nairobi Coffee Exchange. Farmers in Kiambu, Meru, Embu, Murang’a, and Kirinyaga – highland regions that surround Mt Kenya, the source of the volcanic soil that suffuses Kenyan coffee with its strong acidic and fruity notes – are now the biggest producers of macadamia in the country. Increasing output helped Kenya overtake the US as the third-biggest producer in 2013, a position it has held since then. Australia produced 14,100 tonnes of nut kernels last year, compared with South Africa’s 13,383 tonnes and Kenya’s 5,795 tonnes, according to the Reus, Spain-based International Nut & Dried Fruit Council.

Also Read  Strive Masiyiwa: If I started again I’d do agriculture, says telecoms tycoon

The US is the biggest importer of shelled macadamia, according to the council’s latest statistics, followed by China and Japan. Producers exported 31,187 tonnes in 2016, more than double shipments made a decade earlier.

Kenya’s production is expected to increase within the next four years when saplings with better yields mature, according to Maina, who sources the nuts from subsistence farmers. Nairobi-listed agriculture companies, including Kakuzi Plc and Sasini Plc, have joined small-scale farmers in diversifying into the high-value nuts that are eaten raw, roasted, or added to confectionery. Macadamia oil, which is unsaturated and cholesterol-free, is used mainly in pharmaceuticals and cosmetics. Kakuzi has been producing kernels since 2016, having planted macadamia trees where it once had coffee.

Also Read  Highlights: World Food Day Event Held in Eldoret

Macadamia sales more than doubled to KES 371.6 million last year, according to its latest annual report, making the nuts the company’s second-biggest earner after avocados. Smaller rival Sasini, which has been growing coffee since the colonial era that ended in 1963, is constructing a macadamia-processing factory that is scheduled to crush its first nuts this month.

Both these new lines of business, macadamia and avocado, show a lot of promise and the respective industries are thriving globally,” Sasini said in its latest annual report.

Kenya now has 27 licensed macadamia processors, from just five in 2013, AFA’s Busolo said. Other than ensuring there is regulation to govern the sector, the agency will stay out of the industry, he said. With coffee, poor management by the State proved harmful, farmers say.

Source: Standard Media

Share Button

About Graduate Farmer

Graduate Farmer
Graduate Farmer aims is to empower young men and women from becoming job seekers to creators through the agribusiness value chain.

Check Also

Get accurate weather data using your own Weather Station

If you are a farmer in Kenya, there’s no reason why you shouldn’t have a …

Leave a Reply

Your email address will not be published. Required fields are marked *