In Summary
- The direct export of raw, unprocessed macadamia nuts has created an uneven playing field for local processors.
- Local processors have reported losses exceeding 50% in the last year, with many forced to close or face debt collectors.
- Exporting unprocessed macadamia nuts has also led to a scarcity of quality nuts for kernel export markets
Macadamia Farmer
In the quiet, fertile lands of Trans Nzoia, Peter Kimani has grown and nurtured his macadamia trees for over 30 years.
With every season, he has been able to watch his plantations shine and his nuts grow, providing not only a livelihood but a legacy.
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But today, his tone is gloomier, reflecting the growing anxiety among Kenya’s macadamia farmers as the government recently lifted the ban on the direct export of raw, unprocessed macadamia nuts.
“Siwezi uza macadamia ikiwa in shell…kwasababu wale wanaonunua wachina wanachagua mbegu kubwa kubwa huku zile ndogo wakiacha…hiyo inaleta hasara,” Kimani revealed in an interview with Ghetto Radio.
“Hawa wetu wa local processor wananunua yote, mbegu kubwa au ndogo..yote wanachukua,”
“Tukiuza kama iko inshell tutaharibu quality yetu ya soko…kwa sabababu zingine ziko na mold, zingine are pre mature, zingine ziko damaged, kwa hivyo tukifanya hivyo tunaharibu soko yetu huko Nga’mbo, na ikiendelea hivyo watatufungia bishara,”
Chinese Nut Shell Exporters
Kimani’s concerns are echoed by local macadamia processors, who have been hit hard by the government’s decision.
The MACNUT Association, representing these processors, is now calling on the Ministry of Agriculture to reverse its decision.
Jane Maigua, Chairperson of the MACNUT Association, expressed deep concern over the financial losses faced by local processors, many of whom have been forced to close their doors and lay off employees.
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“While the temporary window in 2023 was thought to be useful to help mop up nuts that had remained unsold, this decision has resulted in an increase in the number of Chinese nut-in-shell exporters who are buying these nuts directly through brokers,” she said.
“These Chinese traders primarily purchase grafted nuts, which constitute 50% of the crop in Kenya, leaving indigenous nuts unsold. This has reduced the income for farmers, as the nut-in-shell market only buys grafted nuts, while the majority of Kenyan farmers grow both grafted and indigenous varieties—unlike Kenyan local processors who buy both types for processing,” Maigua said.
AGOA Affected
Maigua also warned that the recently negotiated trade agreements with the USA under the African Growth and Opportunity Act (AGOA) and the Economic Partnership Agreement (EPA) may not benefit Kenyan macadamia farmers if the directive to allow raw nut exports remains in place.
“As of July 2024, exports from Kenya reached KES 3.3 billion for kernels which could have attracted a significantly higher price if NIS was readily available for value addition. Before the restriction, Kenya exported Processed Kernel to diversified markets worth KES 6.9 billion, marking a significant revenue and to Kenya and contribution to national GDP,”
“While the Kenyan Macadamia sector has in the last 10-15 years grown on the back of sales of Kernel to the USA and Europe, the approved directive has significantly reduced the availability of nuts for value addition by Kenyan processors for sale in global markets. The negotiated trade agreements with USA-AGOA and EPA will not be beneficial to Kenyan farmers in the Macadamia Industry if the directive remains as is,”
Mt Kenya Farmers voice support for Exportation of Raw Nuts
However, not all farmers share this view, macadamia farmers from the Mt. Kenya region have voiced their support for the exportation of raw nuts.
They argue that Section 43 of the Agriculture and Food Authority Act, which restricts the sale of unprocessed nuts, has given an unfair advantage to a few processors who, according to the farmers, collude to buy nuts at meager prices.
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These farmers welcomed the temporary suspension of the law by former Agriculture Cabinet Secretary Mithika Linturi last year, which is set to expire this December.
They claim that the suspension provided much-needed relief during a time when the global market was grappling with the effects of the Russia-Ukraine war and the fluctuating dollar.
“A law can only be good if it serves Kenyans. This law does not serve us as Kenyans. As long as it is there, we will continue being at the mercy of a few processors. By November, let them prepare, we will be coming to their offices in droves if they won’t review the law.”
