Posted on October 23, 2018
Dutch social investor Oikocredit has invested Sh500 million ($4.9 million) in Fertiplant East Africa for the establishment of a fertiliser factory in Nakuru, Kenya’s fourth largest city. The plant which the company plans to complete in 2019 will have capacity to produce 110,000 metric tonnes of fertiliser.
Fertiplant East Africa had earlier gotten a Sh1 billion loan from the International Finance Corporation (IFC) but Oikocredit’s investment is for an equity stake in the company.
“All the monies received are directly targeted at getting the plant functional and producing for the 2020 season,” Business Daily Africa quoted Fertiplant Director Titus Gitau to have said.
“Farmers will now through Fertiplant have fertiliser combinations designed for their needs that will directly address soil nutrient deficiencies and crops’ nutrient needs to deliver increased returns per acre,” he said.
Gitau said that the factory will re-introduce the science of soil testing for farmers to better understand what fertiliser combination to buy.
The new plant is expected to save Kenya millions in imports. The country spent $325.66 million on fertiliser imports in 2013, according to the United Nations COMTRADE database on international trade. The government subsidizes fertiliser imports for Kenyan farmers who need at least 700,000 tonnes of fertiliser annually to boost production. Agriculture contributes 26 percent of Kenya’s Gross Domestic Product (GDP) and another 27 percent of GDP indirectly through linkages with other sectors.
Agricultural Principal Secretary Richard Lesiyampe had said in February that Kenya is not capable of producing the fertiliser it needs.
“As a country we have no capacity to manufacture fertiliser because we lack some components. Only South Africa and Morocco can manufacture because they have the raw materials,” he said. However, Fertiplant East Africa will not allow the lack of raw materials locally to stop it. The company is expected to manufacture fertilisers from raw materials like phosphate rocks imported in their raw format.
In June, it became clear that some government officials have been profiting from fertiliser imports, with Kenyan authorities arresting the managing director of the Kenya Bureau of Standards (KEBS) and other officials for allowing the import of fertilizer that failed KEBS tests.
The fertiliser said to have been imported from Morocco was released to the market despite failing the KEBS standards tests. Usually, such products are either destroyed or returned.
“We have established that there is criminal culpability on the part of KEBS officials entrusted with the mandate of monitoring and control of standards,” the Director of Public Prosecutions (DPP), Noordin M. Haji, said in a statement, noting that there was enough evidence to prosecute the government officials.