Avocado contract farming in Kenya: Does it work? Policy Brief 178
The booming Peruvian avocado export sector: Lessons for Kenya Policy Brief 179
The Productive Employment in Segmented Markets of fresh produce in Kenya (PRESM) project investigates alternative approaches for modernizing the avocado sector in Kenya. It evaluates the impact of these approaches on the productive employment of small-scale avocado growers.
The project focuses on the benefits, costs, and constraints associated with producing for modern, export-focused markets, instead of for traditional, locally-oriented markets. Findings from the project provide insights into how the Kenyan avocado sector value chains can be modernized.
PRESM is part of the research agenda of the Knowledge Platform on Inclusive Development Policies.
In 2014, the Netherlands Ministry of Foreign Affairs, through the Netherlands Organisation for Scientific Research (NWO)–WOTRO Science for Global Development programmes, awarded a special research grant to a consortium of international research organisations: PEP, Vrije Universiteit (VU) Amsterdam, Amsterdam Institute for Global Health and Development (AIGHD), University of Nairobi, Grupo de Análisis para el Desarrollo (GRADE), and the Fresh Produce Exporter Association Kenya (FPEAK).
PEP provided overall leadership and management while VU provided technical leadership for conceptual and analytical aspects of the project. The Wageningen Economic Research Institute also collaborated.
Over the last decade, consumers in Europe have learned to appreciate the quality of Kenya’s fresh agricultural produce. Kenya’s horticulture sector engages over half a million farmers and the country’s agricultural exports have reached US$1 billion annually.
This success has been due to the emergence of modern, innovative and programmed production by farmers that are exporting directly to high-value markets and trading companies that meet Global Good Agricultural Practice (GlobalGAP) standards.
At the same time, many smaller growers serve the domestic market and/or sell to collectors and middlemen that cannot, or do not, want to adhere to global standards. This means that the process of structural transformation is creating a modern (programmed) agricultural sector and a traditional (non-programmed) agricultural sector.
In modern value chains, farmers are directly linked to exporters through contractual relationships. They produce according to (certified) global good agricultural practices and their products can be traced back to the producer. In traditional value chains, farmers use non-certified production methods, sell their outputs to ‘brokers’ or middlemen, and their products cannot be traced in the production chain.
Growing avocados that can be exported to GlobalGAP standards requires high-level skills, as such, growth in the modern and traditional segments of this sector has differed substantially.
In June 2014, PEP was awarded a special research grant by the Netherlands Organisation for Scientific Research (NWO) - WOTRO Science for Global Development, through a competitive call for research proposals on "Productive Employment" under the "Research for Inclusive Development in Sub-Saharan African" (RIDSSA) program.
This project focuses on the avocado sector, which now accounts for nearly two-thirds of Kenya’s fresh fruit exports.
The aim of this project is to study alternative approaches to modernizing the avocado sector in Kenya and the effects of these approaches on small-scale avocado growers in terms of productive employment.
To answer these questions, the project compares modern and innovatively programmed value chains with more traditional, non-programmed modes of farming.
The project uses a mixed-methods approach:
The researchers surveyed 790 households and farmers’ groups in Kandara, a sub-county of Murang’a County in Central Kenya. They surveyed farmers who already had a contract with an exporter during the 2015 season, farmers who had signed a contract with an exporter for the 2016 season, and farmers who had not signed a contract.
A qualitative survey was carried out in March 2017 to investigate whether and how avocado contract farming is or can become a successful model of structural transformation in the avocado sector in Kenya. An end line survey targeting the 790 was carried out in late July 2017.
Additionally, recognizing that there is growing international competition on the world market for avocados, Peru – one of the new competitors – was also studied for comparative purposes.