Smallholder avocado farmers affiliated with Kakuzi PLC, a leading Kenyan agri-business firm listed on the Nairobi Securities Exchange (NSE), are set to receive a collective bonus of Kshs 10 million from their 2024 produce exports. This bonus highlights the firm’s ongoing commitment to empowering smallholder farmers and promoting sustainable agricultural practices.
The bonus payout underscores the success of Kakuzi’s Smallholder and Out-Grower Programme, which primarily serves small-scale Hass avocado farmers in Murang’a County but has grown to include farmers from Kirinyaga, Nyeri, Meru, Laikipia, and Nandi counties. The programme equips farmers with access to international markets and best farming practices, economically empowering households while strengthening Kenya’s agricultural economy.
Kakuzi Managing Director Chris Flowers confirmed the bonus payout, noting that despite operational challenges, the company’s commitment to sustainable farming and shared prosperity remained unwavering. The Kshs 10 million bonus, representing 84% of the smallholders’ and out-growers’ profits, will be reflected in Kakuzi’s 2024 audited financial statements.
“Our shared value model ensures that farmers receive at least 80% of the profits from their produce,” said Flowers. “Despite challenges in getting good fruit to the market this year, we have provided a decent return to our partner growers.”
Kakuzi has invested heavily in supporting farmers to meet international quality standards. The company’s extension services department offers free fruit maturity testing, ensuring that only avocados with a minimum dry matter content of 24% are harvested. This guarantees high-quality exports that meet the stringent requirements of international markets in Europe, China, India, and Malaysia.
Farmers are also trained in Good Agricultural Practices (GAP), helping them grow avocados sustainably while improving yields. This education empowers farmers economically, reducing their reliance on brokers and fostering long-term growth in Kenya’s avocado industry.
Kakuzi encourages farmers to cultivate the Hass avocado variety, which is in high demand globally due to its rich flavor, long shelf life, and high oil content. By focusing on this variety, farmers can secure competitive prices in the global market, enhancing their income.
In 2023, Kakuzi paid out Kshs 58.3 million to smallholders from a net return of Kshs 71.7 million, an 81% payout, further demonstrating the firm’s commitment to equitable profit sharing.
As international markets adopt stricter regulations on traceability and sustainability, Kakuzi has made it a priority to help farmers meet these requirements. Flowers highlighted that traceability is critical for accessing global markets. “If you go the broker route, traceability is lost, which jeopardizes market access,” he noted.
The firm’s efforts align with its recently launched fourth Environmental, Social, and Governance (ESG) Report, titled “Fostering Sustainable Development: Balancing Socioeconomic Growth with Environmental Stewardship.” The report adheres to global sustainability standards, including the Global Reporting Initiative (GRI), the United Nations Global Compact Principles, and the UN Sustainable Development Goals (SDGs).
While the avocado export market offers lucrative opportunities, it is not without challenges. Farmers face difficulties such as fluctuating market prices, climate-related risks, and compliance with international standards. Kakuzi’s structured support system helps mitigate these challenges, offering farmers a reliable pathway to success.
The Kakuzi Smallholder Programme has significantly impacted local communities by improving livelihoods and fostering economic resilience. The bonus payments provide much-needed financial relief to farming households, enabling them to invest in education, healthcare, and improved farming techniques.
Kakuzi’s proactive approach to supporting smallholder farmers positions it as a leader in Kenya’s agricultural sector. By investing in capacity-building initiatives and adopting sustainable practices, the company not only ensures long-term profitability but also contributes to national economic development.
As the global appetite for Hass avocados continues to grow, Kenyan farmers stand to benefit immensely from initiatives like Kakuzi’s. Through strategic partnerships and unwavering commitment to quality, Kakuzi is setting the gold standard for sustainable agriculture in Kenya and beyond.