KENYA | USAID Kenya Agricultural Value Chain Enterprise: Feed the Future

The United States Agency for International Development through the Kenya Agricultural Value Chain Enterprises (KAVES) project has funded Farm Concern International, FCI to enhance 30,757 smallholder farmers’ productivity, income and food security by linking them to 1,367 buyers to attain sales worth USD 8 Million in 22 counties within Kenya for a period of 18 months

Programme Summary

Farm Concern International’s (FCI) intervention under USAID-KAVES targets to enhance incomes for 50,000 smallholder farmers across 22 counties. The programme will be implemented in Kisumu, Siaya, Homabay, Kisii, Nyamira, Bomet, Kericho, Nandi, Uasin-Gishu, Marakwet, Bungoma, Busia, Vihiga, Kakamega, Migori, and Trans Nzoia, Meru, Tharaka-Nithi, Machakos, Kitui, Makueni, and Taita-Taveta.

KAVES in brief.

The USAID-Kenya Agricultural Value Chain Enterprises (KAVES) project’s goal is to increase the productivity and incomes of smallholders and other actors along the value chain, thereby enhancing food security and improving nutrition.

The Ministry of Agriculture’s goal is to improve the livelihood of Kenyans and ensures food security through creation of an enabling environment and ensuring sustainable natural resource management. It is envisaged that the project will contribute to this strategy and raise incomes of rural households. The project will make interventions that rectify specific constraints and inefficiencies in the production, processing and marketing of 10 value chains; maize, Irish potato, sweet potato, banana, sorghum, pulses, groundnut, French beans, mango and passion fruit.

FCI is currently providing cross-cutting market development and business development services to KAVES partners and targeting smallholder farmers operating within the USAID designated ‘Feed the Future’ Focus Counties to increase the volume of production of selected value chains marketed through existing trading routes, collection centres or other aggregators of commodities for domestic markets in the KAVES value chains.

FCI is further expected to increase the volume of production of selected value chains marketed through existing trading routes, collection centres or other aggregators of commodities for domestic markets in the KAVES Value Chains.

Problem Statement

Small holder farmers in the African context work in a highly hostile environment that is not conducive to the upgrading of small and often informal producers. Smallholder farmers possess few physical and natural resources such as access to land, water or irrigation systems; they often have very little technical skills and low managerial capacity. They are often have very little access to commercial markets have difficulty in accessing inputs, finance and credit services. These constraints pose a huge challenge for them to ably participate in commercial value chains and when they do participate, high transaction costs are often involved due to the small and dispersed nature of their farming enterprises. 
 
Value Chain partnerships (VCP) are increasingly being recognized as a promising mechanisms enhancing inclusion of smallholder farmers in commercial value chains. Value Chain partnerships have been defined as voluntary and collaborative engagements between different actors in the value chains which have an institutionalized but not hierarchical structure that strives for a sustainability goal. These partnerships are increasingly becoming a solution to overcome market or state failures, and to increase value chain efficiency as partners are able to pool their knowledge, capabilities and resources to offer advantages in terms of productivity, cost reduction and innovations. The underlying assumption is that by pooling resources together, the VCP's will generate end results which would otherwise have been difficult to obtain individually.

The Approach

Farm Concern International (FCI) is a small holder commercialization and market development organization that is a front runner in developing and implementing tailor made interventions that respond to impediments on commercialization and market inefficiencies along the agri-value chains. FCI believes in partnerships and works through strategic partnerships with value chain players such as input providers, government organizations, research bodies, universities, local authorities, processing companies, traders, supermarkets and local markets all geared towards commercialization and market development of small holder communities in Africa

In the development of the value chain partnerships FCI will focus on creating them along the seed farmers, market and consumer components of the value chains. This will ensure that every component of the Value chain is addressed and that the partnerships allow wider interactions resulting in greater impact among the target communities.

The value chain Partnerships will create an excellent opportunity for the value chain players to learn from the experiences of other value chain players through sharing of information, new research findings, market information and case studies. This will not only enhance knowledge but will create synergies among the value chain players through increased interaction and partnerships with each other. The VCP’s shall also offer trading opportunities for the actors involved in Agri- trade in the value chains and provide information that will enable them to make the right investment choices.The VCP will further be graduated into a market information platform for various sets of information under KAVES and used for quantifying and assessing investments by private sector in target crops.

Target Value Chains

  • Maize: Maize is the staple food in Kenya and is critical for food security. The average Kenyan consumes approximately 98 kilograms of maize every year. It is grown by 98% of the country’s 3.5 million smallholder farmers who produce 70 – 80% of the maize.  Kenya produces 3 million tonnes; however, this is not sufficient for the country (FAO, 2012). The country has a potential productivity rate of 39% based on global averages.
  •  Sorghum: Sorghum is the 5th most produced cereal in the world with over 300 million consumers. In terms of production, Nyanza and Western lead at 52% and 23 % respectively with a per capita consumption of 3kgs per year (AGRA,). It is a highly nutritious food and is also drought resistant. 
  • Irish Potato: The Irish potato is the second most important food crop in Kenya after maize employing 2.5 million people (CIP, 2011). About 35,000 hectares of potatoes are cultivated in Kenya while the production in Kenya is currently worth about KES 50 billion  (NPCK, 2015). Irish potato has a high potential for addressing food insecurity due to its high productivity per unit area. The potato industry can increase if production and processing is optimised 
  • Banana: The banana is a staple crop in Kenya. It has one of the highest values of enterprise per unit area and has high gross margins. It is a very nutritious crop and economically viable as there is high demand for green and ripe bananas in the domestic market. According to the National Banana Strategy for 2013- 2016, Bananas contribute 30-40% of all the fruit revenue generated in the country (KNBDS, 2014). 
  • Pulses: Kenya is among the top pulse producers with a value of 760,000 tonnes annually. It is a high protein plant and requires small land acreage.  
  • Groundnuts: The prevailing high demand for groundnuts internationally and within Kenya presents an opportunity to invest in local groundnut production and trading. This is evidenced by the growing middle income class in developing countries and their increasing preferences for packaged snack and food products.
  • French beans: French beans in Kenya are mainly grown for the export market. A key consideration in expanding and maintaining regional and international trade in French beans is compliance with market standards and government regulations in importing countries. French beans accounted for 29 per cent, Sh4 billion, of Kenya’s total earnings from vegetable exports of Sh13.7 billion last year. 
  • Mango: Currently, mango has an output of 10 tonnes per hectare. Kenya has a competitive advantage in mango production and marketing namely; excellent almost year-round production conditions, strong local markets and proximity of Gulf markets for fresh fruit, substantial recent investment in fruit juice processing facilities, established global marketing capability of export companies and excellent private sector support services available.  
  • Passion fruit: The main challenge to passion fruit production is lack of clean planting material free from fusariumwilt; woodiness and die-back diseases which if addressed will greatly mitigate the disease

Case Studies

Machakos County Trade Fair marked a new dawn for Mr. Clement Kilonzi

Mr. Clement Kilonzi is a farmer from Kaani Location in Machakos County who attended Machakos County Agricultural Trade Fair organized by USAID Kenya Agricultural Value Chain Enterprises project on 22nd March 2016. Clement left his home with high hopes and anticipation of a bright day full of new learning experience. The exhibitors did not disappoint because they gave Clement the solution he had been searching for years; the spray programme for his mango trees... Read more >>

Neema Bakari earns USD17,765 (Ksh1,812,000) annually from tissue culture bananas

Mrs. Neema Bakari of Kimorigo village is a smallholder farmer who is an active member of Eldoro Irrigation Scheme is slowly but steadily rising above the odds and challenges as a smallholder farmer is happy to narrate her successes in banana farming. Neema has been cultivating bananas for three years from 2013 on her three (3) acre piece of land. Mrs. Neema is a beneficiary of capacity building events facilitated by Farm Concern International (FCI) through collection center leaders on market led production, business development and entrepreneurship courtesy of USAID Kenya Agricultural Value Chain Enterprises Programme... Read more>>

Reaping the Benefits of Collective Action

Mr. Thomson Lendoro is a farmer and a wholesale buyer who was introduced to Kongowea market and KAVES farmers in Taveta Sub County by Farm Concern International. Before the intervention by Farm Concern International, Mr. Lendoro struggled to source bananas since most of his suppliers were widely spread across Taveta Sub County and majority had low quality produce. As a result of USAID Kenya Agricultural Value Chain Enterprises training on Good Agricultural Practices, commercialization, market specifications and value addition, farmers now produce healthy bananas which fetch good prices... Read more>>

Mr. Yewa Records Increased Profits by Buying from Aggregation Centers

Mr. Samson Yewa is one of the longest cereal traders in Awendo market of Migori County having been in the business for more than ten years. Mr. Yewa has been faced with myriad challenges in the business especially low supply of cereals during the off season and poor quality produce by farmers. This had forced him to source the product from Uganda and Tanzania leading to low profit margins.... Read more>>

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