Avocados are sold at Wakulima Market in Nakuru on May 7, 2019. Avocado exports bring higher pay for hired labourers. PHOTO | FILE | NATION MEDIA GROUP
Exporting avocados to EU earns 39pc more, says study
Kenyan smallholders can boost their incomes by nearly 39 per cent by exporting avocados to the European market, a Washington-based research institute said in study findings released on Thursday.
A dozen avocados of the Haas variety that sell for about Sh3.5 in the domestic market fan fetch almost Sh6 when exported, according to the International Food Policy Research Institute and partners in the study.
But small-scale Kenyan avocado farmers are typically unable to take advantage of the higher prices paid abroad due to insufficient capital, poor infrastructure and the high cost of meeting stringent export standards, the study finds.
Currently, the researchers note, only a few small-scale avocado farmers, mostly in Murang’a County in central Kenya, are linked to export markets through contract farming.
Despite growing international demand, avocado exports from Kenya have been declining as a share of total production of the crop.
That share now stands at 10 per cent, far less than the export rate for avocado production in competitor nations such as South Africa and Chile, the study says.
“Providing households access to foreign markets and up-to-date information on farm technology, along with the dissemination of simple and domestically invented technologies, could achieve higher farm incomes, revenues and sales prices,” said Mulubrhan Amare, the study’s lead author.
In addition to raising small farmers’ incomes, avocado exports bring higher pay for hired labourers, the researchers say.
Family labour inputs on avocado-exporting small farms increase by about 15 days a year, with female workers accounting for most of that addition, the study reports.
Based on survey data from large-scale avocado farmers in Kenya, the study found that those participating in export markets were older and better trained than those farmers who did not sell abroad.
Farmers who exported also had higher likelihood of living near a well-functioning avocado farmers’ group, the study notes.
This report mirrors an analysis earlier done by the Nation illuminating farmers’ predicament and logistical nightmares that come with the stringent procedures of the avocado export market.
Avocado business has become lucrative in Kenya following growing demand for the fruit across the world due to increased awareness of its health benefits.
Kenya is Africa’s second largest producer of avocados, after South Africa.
It exports the produce to the United Arab Emirates, the United Kingdom, Egypt, The Netherlands, France, Saudi Arabia, Belgium, Spain, Qatar, Bahrain, Kuwait, Germany and Hong Kong with emerging markets in Malaysia, Singapore and South Korea.
In the 2018-2019 financial year, Kenya exported avocados worth Sh10 billion, representing about 80,000 tonnes, which is double the amount exported in 2016, according to data from Kephis.
The European Union accounted for 42 per cent of the market, while the Middle East came second at 28 per cent.
The government’s drive to promote avocado farming for export has seen more than 7,500 hectares of land under cultivation of the crop.
Some 70 per cent of growers are small-scale farmers who are the most affected by the stringent regulations.
What exactly does it take to become an avocado exporter? A whopping 56 steps, shuttling from one government agency to another, to get avocado export clearance.
KenTrade has uploaded the procedure on their website to ease access to information by all international traders.
But traders say following the process is cumbersome and many get discouraged along the way.
The procedures documented range from how to obtain food hygiene licence for the pack house facility and pack house inspection report from Horticultural Crops Directorate (HCD) and getting a phytosanitary certificate for exporting avocado from Kephis, which also registers exporters.
Export health certificate is sought from Port Health Services and clearance of the consignment with Kenya Revenue Authority (KRA).
The step-by-step guide shows that the 56 steps require visiting 11 different offices, some of which are visited more than 10 times. The HCD office alone is visited 11 times out of the total.
Others include the Kenya Trade Network Agency, (seven times), which offers training and gives credentials to new exporters.
The cost of the entire procedure amounts to about Sh40,000.
Mrs Rosemary Muita, an agribusiness trader in Nairobi and Kiambu, says she gave up halfway in the application for clearance to export avocado crude oil product that she produces.
And unlike those with certificates who access the foreign market directly and fetch more from their avocado, Mrs Muita uses agents, who take almost half of the profit.