10 INTERVENTION PRINCIPLES
No substitution of local stakeholders
Investment in local expertise and human resources
Pooling of problems and solutions / Economies of scale
Demand-driven intervention / Cost sharing
Export as factor of modernisation
Structured relationship between local value chain operators
Cross-cutting focus on youth and gender
A SUSTAINABILITY APPROACH BASED ON 3 PILLARS: CHARTER, TRAINING AND SELF-ASSESSMENT
This provides a simple framework for continuous improvement, focusing on the business case so that adopting good practice not only facilitates market access, but genuinely helps suppliers run more efficient, profitable and resilient businesses. It consists of three central elements:
COLEACP APPROACH IN KENYA
Kenya, the fifth largest economy in Sub-Saharan Africa, became a low-middle-income country in 2014. Its population is 47.5 million (Kenya Census, 2019), 73% of whom live in rural areas where a significant proportion rely on subsistence farming. Rural poverty and income inequality remain persistent challenges due to critical demographic pressure as the population more than tripled over the past 40 years and is expected to reach more than 90 million by 2050 (World Bank, 2019).
Following the 2008 global economic recession, growth over the past five years (5.7% in 2018) makes Kenya one of the fastest-growing economies in Sub-Saharan Africa, but its performance is strongly influenced by weather conditions as agriculture remains the backbone of the Kenyan economy (see more information on the macroeconomic context here). The agricultural sector was valued at KES 3.3 trillion in 2019 (Kenya National Bureau of Statistics, 2020).
Position of fruit and vegetables on export market
Over the past 10 years the UK has been the largest export destination for Kenya’s fruit and vegetables (25%, fresh and processed), followed by the Netherlands (16%) and France (11%). Over the past three years the main export sectors were beans, pineapples and avocados. For cut flowers, the UK is the second largest export destination after the Netherlands, receiving respectively 49% and 18% of the flowers produced in the country (2019).
Trade data and trends
According to the Horticultural Crops Directorate (HCD), the value of horticultural fresh produce exports (flowers, fruit and vegetables) is estimated at KES 157 billion in 2020 (versus KES 145 billion in 2019). Cut flower exports remain the largest contributor with an estimated KES 134 billion (KES 104 billion in 2019), representing 73% of total fresh produce annual earnings. Fruit (12%) and vegetables (15%) in 2020 account for KES 19 billion (KES 13 billion in 2019) and KES 24 billion (KES 27 billion in 2019), respectively.
In Kenya, the floriculture industry earned 885 Million in 2018, 814 Million in 2019 and 862 Million in 2020 from exports of cut-flowers, predominantly roses. Cut flowers sub-sector employs over 200,000 directly and supports over 4 million livelihoods, thus contributing greatly to the economy.
The European Union is one of the major markets for Kenya’s horticultural produce for floriculture including roses, carnations, and gypsophila. The floriculture sub-sector has recorded the highest growth in volume and value of cut flowers exported over the years, with Kenya attaining the lead supplier status to the European Union (EU).Read More
For Fruit and vegetables, Kenya has strong historical links with the European market, being the second largest supplier of vegetables from Sub-Saharan Africa to the European Union (EU), after South Africa. However, while 10 years ago the European market accounted for more than 80% of the volume of fresh and processed fruit and vegetables exported from Kenya, today this has decreased to 50% by volume, although still 70% by value. Half of the fruits and vegetables exported to the EU are processed. The Netherlands (pineapples, avocados and beans); United Kingdom (beans and other vegetables); and France (beans, avocados and pineapples) are the main importing countries.
The Kenyan origin struggles to remain competitive and attractive to EU buyers, so an ambitious trade diversification policy is being executed towards:
- East and Southern Africa – carrots/turnips, potatoes, mangos, beans, brassicas to Uganda and Tanzania;
- Western Asia, especially the Middle East – mostly United Arab Emirates and Saudi Arabia for fruits such as avocadoes (approx. 16,500 tons, 2019) and mangoes (approx. 7,500 tons, 2019);
- Eastern Asia – India, Pakistan, China, etc. for beans, green grams, peas, nuts and other legumes, with growing importance of China for produce such as frozen avocado and nuts, and thanks to an industry that has strategically invested in local processing of its products.
The value of produce on domestic markets is estimated at KES 400 billion. Locally, the main vegetable production is of Irish potatoes, pulses and brassicas, also sweet potatoes, cassava, tomatoes and leafy vegetables. Unfortunately, about 30–40% goes to waste due to poor post-harvest handling, limited opportunities for value addition, and poor market infrastructure with no provision for proper storage (Proc. Nutr. Soc. 74(2015)487).
Opportunities exist as there is promising demand on domestic, regional and international markets for fruit and vegetable products (avocado, mango, French beans, cut flowers, etc.). There is a substantial food production gap in Kenya, reflected in the negative physical trade balance for fruit and vegetables. Imports of fresh fruit and vegetables (mainly apples from South Africa; oranges from Egypt, Tanzania, Uganda; dates from UAE; onions and shallots from Tanzania; tomatoes from Uganda) have been increasing as demand grows in cities and retail becomes more formalized, even though the majority of domestic fruit and vegetables are still bought on wet markets.
Click here for up-to-date reports on Kenya’s global import and export trade in fruit, vegetables and nuts.
Devolution : a pillar of the August 2010 Constitution, devolution seeks to bring government closer to the people, with county governments playing a central role in dispersing political power and economic resources to Kenyans at the grassroots. Many agricultural functions have been transferred to devolved units.
Climate change – drought and flooding : The Kenyan economy faces an important threat due to its heavy dependence on natural resources, and climate change and related disasters could impair its performance by 2–3% of GDP each year by 2030 (Stockholm Environment Institute, 2009). Nearly all the country’s crop production is rainfed, and almost half of animal production occurs in arid and semi-arid lands. The growing impacts of drought and unreliable rainfall are expected to affect the most vulnerable populations disproportionately, impacting women the most. Severe drought during the 2016/17 production season negatively affected production levels and production costs of fruit and vegetables. On the other hand, in many areas the 2017/18 season saw excessive rainfall resulting in floods. December 2019 saw further flooding in Kenya, causing losses of many crops including French beans, peas and mangoes.
Social factors : exporters who work with outgrowers are facing a rapidly ageing population of farmers, with an average age around 60. Few of the rural youth see their future in agriculture.
Brexit : the United Kingdom’s withdrawal from the EU customs union and single market gives rise to economic and market changes. Kenya has secured the right to continued duty-free/quota-free access to the UK market in the post-Brexit period through the Economic Partnership Agreement between the EU and the East African Community (EAC).
On 1st January 2021, GB adopted existing EU legislation on plant health, food safety, and organic certification. However, from this point onwards, the regulatory systems and rules will begin to diverge. Already differences are appearing in terms of (for example) pesticide maximum residue levels, regulated pests, and documentary requirements. Export sectors will need to follow closely the relevant UK.GOV websites to keep abreast of these changes.
Triangular supply chains, where produce is exported to GB via the EU, are currently the most affected by Brexit. Consignments that are cleared in the EU face tariffs, are subject to different rules (including plant health), and organic produce cannot be re-exported to GB as organic. Using the Common Transit Convention (whereby produce is not cleared in the EU) is recommended to avoid some of these major difficulties, or direct shipping Kenya-GB. However, the negative impacts on this triangular supply chain remain a major concern, in particular for the Kenya Flower Council; the infrastructure to handle flowers flown directly to the UK is not yet well developed, leaving Amsterdam and Liege as the main entry points into Europe.
For more information on the new GB rules see the latest Brexit update from COLEACP here and ongoing Brexit news and links to important UK.GOV advice, here. Kenyan horticultural exporters need to take the necessary steps to ensure that they meet new rules on exporting to GB to minimize any adverse effects arising from logistical, administrative, contractual and market changes.
Locust invasion : between January and March 2020, Kenya was subject to locust invasions that caused substantial damage to crops. There are alarming indications of a second wave to come.
COVID-19 pandemic : from March 2020, along with most countries worldwide, Kenya was heavily impacted by the COVID-19 crisis, causing huge losses of markets for flowers (estimated at 75%) and greatly limiting exports of vegetables, especially airfreighted produce. The crisis will have a major impact on the businesses and livelihoods of thousands of workers and outgrowers.
SPS compliance challenges
Brexit (see above) may also mean changes to the territorial coverage of existing sanitary and phytosanitary (SPS) import inspection and approval processes, particularly important for Kenyan exporters serving the UK market along triangular supply chains. The UK’s phytosanitary inspection services are likely to be under strain, given the scale of new demands for inspections. However, post-Brexit the UK is likely to consider solely the climatic conditions prevailing in its territory when conducting pest risk assessments, which may lead to more favourable conditions regarding phytosanitary control measures for Kenyan exporters.
New SPS compliance challenges arise for the Kenyan horticultural industry, in particular from the strengthening of plant health rules (under current Directive 2000/29/EC, and the new Regulation EU 2016/2031), which are placing increased demands on inspection services and National Plant Protection Organizations (NPPOs); developments under Regulation (EC) 1107/2009, which governs the placing of plant protection products (PPPs) on the market; and the harmonization of pesticide maximum residue levels (MRLs) under Regulation 396/2005/EC. These are leading to the effective loss of PPPs, affecting the viability and competitiveness of some Kenyan exports, as well as exacerbating plant health problems and resulting in non-compliances with EU MRLs.
In January 2019, the EU placed Kenya on its list of countries subject to more stringent surveillance, increasing the frequency of checks on all beans imported from Kenya to 5%. This is expected to increase to 10% in early 2020 due to continued MRL non-compliances.
Click here for up-to-date reports on Kenya’s RASFF notifications and EUROPHYT interceptions.
COLEACP’s intervention strategy for Kenya has been informed by exploratory missions in December 2016 and March 2017, and follow-up missions in September and December 2017, and March, May and November 2018, as well as 92 requests received by the end of the third year of the Fit For Market programme. The strategy focuses on the following topics.
The focus is on value chains with high market potential: for the export market these are fine vegetables (French beans, peas, chillies) and avocados. Sweet potato, mango and passion fruit are also developing, and are covered on demand. For local markets, the main crops include tomatoes, potatoes, Sukuma wiki, cabbages and onions. Many of the companies applying for support export fine vegetables(French beans, peas, chillies, baby corn, tenderstem broccoli, runner beans) to the EU, often mainly the UK (29 applications received so far). Many of the other applications were submitted by avocado-exporting companies (27), of which eight are becoming or are already certified for organic production. The other applications received are from three companies producing passion fruit and nine companies producing mango. All of these companies focus on export of fresh produce, except for three companies that are processing French beans, sweet potato or mango. Some of the companies also sell produce on the domestic market.Read More
The majority of applications received under the Fit For Market programmes and recently also NExT in Kenya are from exporting companies (75 applications by the end of December 2020). Most of these companies source from outgrowers, while some of them manage the production themselves. Other beneficiaries are service providers (30 requests received by end of December 2020); professional organizations (Fresh Produce Exporters Association of Kenya- FPEAK, Kenya Flower Council KFC, Fresh Produce Consortium, FPC-Kenya, Mango traders association, Avocado society of Kenya) ; public institutions (Horticultural Crops Directorate, HCD; Kenya Plant Health Inspectorate Service, KEPHIS; Kenya Agricultural & Livestock Research Organization, PCPB, Ministry of Agriculture Livestock and Fisheries); Universities and training institutions (three requests received); one NGO, the Kenyan National Technical Working Group (KNTWG) an the recently revived Kenya Task Force for Horticulture . Under the NExT programme new types of beneficiaries have been included such as KEPROBA and RETRAK to strengthen the Kenya branding and marketing strategy and to execute successful pilots on domestic food safety compliance for fruit and vegetables.
Compliance with private sector standards:
Under COLEACP’s earlier programmes (PIP), food safety compliance and the good agricultural practices associated were covered extensively in Kenya. However, under the Fit For Market programmes and the NExt Kenya programme, many companies applying for support had never been supported to set up a quality management system. Support on implementation of food safety management systems is only offered to new beneficiaries and to companies that want to implement food safety for the domestic market. An example of this strategy is Instaveg, a company that implements KS1758, the national food safety standard for fresh fruit and vegetables, for crops that are grown for the domestic market. In the area of food safety compliance, Fit For Market introduced a new tool in Kenya, the GLOBALG.A.P. awareness-raising handout. This enables companies to introduce the GLOBALG.A.P. standard to their outgrowers and reflect on the shared responsibilities for compliance, and should improve outgrowers’ ownership of the GLOBALG.A.P. standard.
In response to the COVID-19 crisis and additional compliance criteria to embed in the existing food safety standards, digital training and coaching was developed and rolled out.
On the social compliance side, and depending on the specific customer requirements, companies need assistance with the implementation of ETI, SMETA, Fair Trade, Fair For Life, BSCI and GRASP standard, and are now starting to include their outgrowers as well in these certification schemes. COLEACP is supporting companies to sensitize and train their outgrower extension teams to implement this.
Training on and assistance towards organic certification is provided to companies that have identified a market for the organic products. In case the certification covers crops that are not usually grown organic, the technical feasibility of the production protocol under organic certification will be examined prior to setting up the certification, as well as awareness raising and risk assessment of new outgrowers.
Climate change resilience and Environmental management
The COLEACP Self Assessment Tool for companies and cooperatives, rolled out for the first time under the Fit For Market programme , revealed weaknesses regarding waste management, soil conservation, water management, and optimal energy use .
Specific support has been offered regarding energy use at packhouse level, and the use of solar energy for drip irrigation, as well as compost and bio gas production. Support has been offered to companies that want to implement Environmental Impact assessment, and implement good environmental management practices.
As a response to the drought and climate change challenges, group training will be offered on improved soil conservation techniques and water management methods to increase resilience, especially for outgrowers. Following the design phase, the third year of the programme has seen an interesting pilot of demoplots for Frigoken, a company working with 50,000 outgrowers. A follow up is foreseen in 2021.
In 2021 series of trainings will be offered to the companies on Sustainable Water Management, Sustainable Soil Management, Sustainable Air management, Sustainable Production System, Sustainable Energy Management, Sutainable Biodiversity Management and Sustainable Waste Management
Post harvest losses
In Kenya’s avocado value chain, important post-harvest losses occur, and the product’s reputation on the EU market is mediocre. An assessment has been made of the factors that impact the quality and losses, and a national workshop for the managers of avocado-exporting companies has been organized to sensitize companies on the quality issues facing Kenyan avocado on the EU market. Post-harvest losses have also been addressed several collective trainings on avocado fruit quality management and dry matter testing, including individual coaching sessions. An industry Good Practice Guide for avocado will be produced in 2021 to further improve practice along the value chain and increase the production of exportable fruits. Post-harvest losses and fruit quality will be addressed through assessments of companies’ IPM strategies for avocado and mango, including cost benefit analysis , followed by IPM training for producers of these crops. There is an action plan with the Eastern Africa Farmers Federation (EAFF) to work with organized farmers’ groups in several avocado-producing counties in Kenya to strengthen their capacity in production, harvest and post-harvest management, and market access.
The Kenyan horticultural sector will be supported to implement any necessary adaptations in line with the new EU Plant Health regulations. Several companies have requested support for implementing False Codling Moth (FCM) production protocols for chillies. An awareness-raising workshop was organized to sensitize Kenyan horticultural sector stakeholders on the new regulation. The Kenya Plant Health Inspectorate Service (KEPHIS) and the Agriculture and Food Authority (AFA) have also been supported to assist the Kenyan horticultural sector in this area, amongst others, through targeted interactions with the relevant EU institutions. Collaboration with, and capacity building of, the technical staff of the Kenya missions in the EU has been included in this strategy. To mitigate the number of interceptions for FCM on roses, the KNTWG has been supported to organize CEO sensitization sessions, peer-to-peer information and training sessions and develop an improved FCM management protocol.
Under the NExT programme and in collaboration with the exporters associations, repeat offender companies received and will receive individual coaching by FCM experts to improve their management of the pest.
COLEACP has supported the KNTWG to develop into a National Task Force for Horticulture that will address the main bottlenecks the horticulture sector faces in a coordinated way.
KEPHIS will receive further support to fully exercise its role in phyto-certification and inspection, through training of inspectors on technical and soft skills, and development and/or improvement of adapted production protocols for chilies, mango and other crops affected by presence of harmful organisms. A thorough capacity and skills audit has been performed, The results of this assessment has allowed COLEACP to develop a full and relevant action plan to support KEPHIS.
A workshop has been been organized to define a roadmap for the sector to lift the increased control regime on French beans, including risk profiling of companies. Good Practice Guides for the French beans and peas sector, developed under the EDES programme, will be updated and adapted to the current SPS context, and used to implement good practices throughout the entire value chain.
Kenya’s Horticultural Crops Directorate (HCD) plays a major role in ensuring companies are vetted before receiving their export license and ensuring they apply good SPS practices and follow the recommended codes of conduct. Together with KEPHIS, HCD is the main stakeholder with which the private sector will interact in relation to SPS crises. HCD’s marketing department plays an important role in conflict resolution, and in marketing of the Kenya origin. HCD will be supported to evaluate and train marketing agents (brokers) for mango, avocado and fine beans. Support will be provided through risk profiling of exporters and vetting of new exporters; and improving the quality control of avocado exports. A mission will be organized to the main Middle Eastern countries to better understand the market requirements and potential for Kenyan produce, and address the quality issues for Kenyan produce on these markets. HCD will also be supported to organize end-of-campaign sector meetings for avocado, mango and fine vegetables, to evaluate the past campaign and learn lessons for improvement.
Emphasis will be placed on support to Kenya’s Pest Control Products Board (PCPB) to make available an up-to-date list of plant protection products (PPPs) with recommended GAPs for the main export crops, as well as horticultural produce destined for local and regional markets. The list of PPPs will be aligned with the MRL regulations of the main destination markets and the international Codex MRLs, taking into account human and environmental risk assessment, as well as the capacity of operators to deal with pests and diseases. A number of trials for label extensions, new registrations, or screening of new candidates will be supported. Support with post-registration monitoring of pesticides will be another emphasis, given the high risk of presence of counterfeit pesticides in the counties.
An awareness-raising module will be developed and disseminated to encourage young farmers to engage in export production, and companies will be trained to assist their outgrowers in better financial planning and cashflow management of their production. In the response to the COVID-19 crisis, bootcamps have been organized to strengthen the company’s capacity to deal with uncertainty, cash flow management and business planning.
For companies, support is and will be provided to improve or develop companies’ business models and operational business plans, in order to increase their resilience, their capacity to reach out for additional funding, and their overall business performance. Companies received and will receive training on how to better handle claims and other risks linked to overseas export activity and cargo insurance.
Companies will receive support to optimize their participation in trade fairs, including virtual trade fairs, assess and reduce energy use in the packhouse, improve the efficiency of the packing process, set up viable business models and plans, and to become more competitive.
For large companies employing over considerate numbers of staff at packhouse and production levels, capacity building has been organized on people management, staff retention policies, and setting up internal training units.
Strengthening of the Private sector associations
FPEAK, the exporters’ association, will receive assistance to strengthen its offer of member services. Training packages on crop protection and quality management, originally developed under the PIP programmes, are being transferred to the FPEAK training unit, allowing FPEAK to offer this training to its members. KFC, FPEAK, FPC Kenya and the avocado Society of Kenya will be capacitated to be in a better position to represent their members, govern the association, and offer service to their members. Support will include the development of a data management strategy, representing members at international trade fairs and trade missions, as well as to train and coach their members on SPS related matters.
Since March 2020, with the evolution of the Covid-19 pandemic, COLEACP has adapted to continue working while integrating domestic and international guidelines. The safety of people, including partners, service providers, and members, is COLEACP’s priority.
Our field activities have been adjusted to comply with the precautionary measures related to Covid-19.
COLEACP works closely with multiple donor-funded initiatives in the Kenyan horticulture industry to ensure synergies by exchanging information (ensuring transparency), identifying opportunities for coordination and collaboration, avoiding duplication and overlap, and up-scaling impacts (outputs can be adopted and disseminated by other programmes).
- AgriFI programme (DANIDA; Micro Enterprises Support Programme Trust, MESPT; Self Help Africa): the proposed intervention is highly complementary to the MESPT programme as the main target is farmer groups rather than exporters. The collaboration will aim to ensure small equipment/infrastructure can be financed through the AgriFI programme, while the new intervention will facilitate training dissemination and support compliance with market requirements to ensure market access for the produce of the targeted groups. Self Help Africa is also complementary because it provides access to finance for enterprises (soft loans and grants).
- Market Access Upgrade Programme (MARKUP) (United Nations Industrial Development Organization at national level; International Trade Centre at regional level): at the national level, the collaboration will focus on creating synergies to support public extension staff, especially in mango and fine vegetables value chains, mostly through training for county extension staff where the programme is active (Busia, Siaya, Bungoma, Trans Nzoia, Uasin Gishu, Elgeyo Marakwet, Taita Taveta, Kilifi, Makueni, Machakos, Kajiado, Meru). At the regional level, the objective is to avoid duplication for beneficiaries in the avocado value chain by building complementary action plans, collaborating in the setup of an interprofessional platform, and implementing the Good Practice Guidelines for avocado).
- USAID-funded programmes: the Kenya Crops and Dairy Market Systems (KCDMS) programme, managed by RTI International, exhibits strong complementarity and some potential areas of overlap. The focus of the collaboration will be the mango value chain, where COLEACP will complement the activities RTI runs for the private sector through support for public sector organizations such as KEPHIS to improve market access for Kenyan mango to the EU by setting up a national action plan for fruit fly management and submitting a mango dossier to the EU (DG SANTE).
- TradeMark East Africa: the second phase of the project, launched in January 2020, focuses on physical access to markets (construction of roads, border control points, setting up export processing zones, improving airports and ports), and improving the trade environment (policies, regulations) and business competitiveness.
- CABI: CABI’s Plantwise programme in Kenya ended in December 2020; today Kenya has 300 plant clinics manned by two plant clinic doctors in 25 counties. CABI is in the design phase of a new programme in Kenya, funded by the EU (DG DEVCO), to improve capacity to detect new pests and outbreaks, and also focusing on food supply systems.
A donor mapping exercise to ensure synergies will be facilitated at the level of the National Task Force for Horticulture. COLEACP will formalize MOUs/collaboration agreements and establish information-sharing mechanisms with the programmes listed above.
In some cases the collaboration will go beyond information-sharing. For example, the joint effort with the national component of the MARKUP programme to establish of a baseline survey on the actual and potential role of Kenya’s county extension services in the French bean, mango, avocado, chilli, groundnut, macadamia and fresh herbs value chains, which will be followed by harmonization of the support offered to the counties.
In addition, COLEACP has established partnerships with the Netherlands Trust Fund programme, which supported the Kenyan avocado sector until mid-2017. Through the Fit For Market programme, COLEACP continues to support the 11 avocado exporters based in Murang’a County that benefited from this programme.
COLEACP also engaged with SNV’s Kenya Market-led Horticulture Project (HortIMPACT) in Kenya, to reflect on food safety compliance implementation for domestic markets. COLEACP contributed to the National Fruits and Vegetables Horticultural Conference 2018 and 2019, organized by FPEAK and FPC-Kenya, and facilitated by SNV, Global Communities, and Fit For Market.
ENHANCING KENYAN HORTICULTURAL EXPORTS: COLEACP’s NEW EU PROGRAMME
COLEACP’s new Nairobi-based programme, signed on 30 April, aims to increase the resilience, inclusiveness and sustainability of Kenyan horticultural value chains. The four-year, €5 million programme financed by the European Union through the EU delegation in Kenya, will aim to secure a lasting improvement in the capacity of all stakeholders in the Kenyan horticultural sector to adapt to evolving sanitary and phytosanitary (SPS), commercial, social and environmental requirements on local, regional and international markets.