Twiga Foods begins farming under new partnership with Kenyan government

B2B meals commerce startup, Twiga Foods has commenced maize farming as a part of a public-private partnership with Kenya’s government to scale up meals manufacturing, studies BusinessDaily Africa. The Galana-Kulalu Food Security Project is a pilot analysis challenge throughout the Galana Irrigation Scheme, an bold 1 million-acre agriculture challenge designed to enhance meals manufacturing in Kenya. 

Under the Galana-Kulalu Food Security challenge,  10,000 acres had been designated for a mannequin farm with the goal of testing the efficiency of recent irrigation programs on a big scale. But since 2014, the challenge has struggled to satisfy expectations owing to fluctuations in budgetary allocations and unhealthy climate. In 2019 the mannequin farm was projected to make Ksh 1.2 billion in maize gross sales per season. But it solely managed 119,000 90 kg baggage of maize, price about Ksh 273.7 million.

In January 2023, Kenya’s Ministry of Water introduced that it might open up 5,000 acres of the Galana-Kulalu Irrigation Scheme to personal corporations under a government-private partnership to allow the government to extend meals manufacturing. Twiga Foods, which was celebrated as the highest paying Medium Taxpayer final 12 months by the Kenya Revenue Authority, seems to be the primary personal firm to start business farming within the Galana-Kulalu challenge space.

In May 2022 Twiga Foods opened its first farm, because it moved to combine a part of its provide chain. Launched under a new subsidiary, Twiga Fresh, the corporate invested $10 million to provide onions, tomatoes and watermelons on 1,606 acres of land, with an estimated yearly output of 150,000 tons of recent produce. 

“We will continue to run the B2B e-commerce business under Twiga, focused on building a one-stop supply-chain solution for informal retailers, delivering both Twiga and non-Twiga -owned products. Twiga Fresh, in addition to our growing range of private label products, will ensure we drive growth in customer numbers and broaden the basket size by offering quality produce at a discount against prevailing market prices,” mentioned Peter Njonjo, Twiga CEO and co-founder mentioned on the time, highlighting the pattern of huge East African B2B meals commerce corporations looking for to combine backwards to be able to get a a lot firmer management of their provide chain.

Kenyan government officers had been impressed by Twiga’s business farming ambitions and resolved to include one in all their favorite taxpayers to assist convey life into the Galana-Kulalu Food Security Project.

“We have visited the farms where Twiga is doing production and we were convinced that they are the best. They will not only help us in achieving food security but also create employment,” mentioned Mugambi Gitonga, Principal Secretary for Irrigation, per BusinessDaily Africa, a Kenyan enterprise media publication.

Kenya is dealing with record-high costs in meals staples which have pressured the nationwide government to intervene with subsidies for unga (maize flour) and different staples. To stave off the disaster, Kenya’s government signed agreements that waived the import of genetically modified produce in addition to particular import agreements for key meals staples. Both strikes have been broadly criticised by Kenyan farmers.

According to the Kenya Institute for Public Policy Research Analysis, 14.5 million Kenyans face meals insecurity and poor vitamin every year with 2.6 million Kenyans thought-about to already be in a meals insecurity “crisis”.

Twiga Foods has raised a complete of $157.1 million from enterprise traders since its founding in 2013 and is one in all Africa’s largest retail B2B meals commerce corporations.