The US government has reiterated its commitment to revive the once vibrant pyrethrum sub-sector in Kenya, pledging to inject Sh1.6 billion (US Dollars 12 million) into the industry.
The Country’s envoy to Kenya Ms Margaret Whitman said construction of a modern pyrethrum processing facility in Naivasha Sub-County for Sh1.4 billion was ongoing adding that the Kentegra plant is projected to serve over 90,000 small-scale pyrethrum farmers.
Ms Whitman said her country is keen to help Kenya revive the sector which collapsed in the 1990s, due to massive corruption and mismanagement.
“The United States through Kentegra Limited has invested heavily in pyrethrum and currently is engaging 9,000 farmers, with plans to expand the number to 90,000 countrywide. Nakuru’s location is ideal for investors to pitch in their businesses. This forum, the first of its kind is aimed at improving trade and investments, creating job opportunities for Nakuru residents and the Kenyan population at large,” added the envoy.
Ms Kihika termed the processing plant as a game changer to hundreds of small-scale pyrethrum farmers.
She affirmed that her administration was committed to increasing land under pyrethrum farming, from 7,000 acres to 10,000 acres, in the next few years.
Ms Kihika singled out diseases, the rising cost of production, and inadequate seedlings as some of the challenges facing the sector, which her administration is doing all it can to address.
“In the 1990s, Kenya accounted for 80 percent of global pyrethrum exports. However, this has reduced to five percent, and we need to address this,” Kihika said.
The Governor pledged that her administration was keen to unlock the multi-billion-shilling potential in agriculture, health, water and sanitation, horticulture, and floriculture sectors adding that to facilitate ease of doing business, plans for a single business permit are underway to create an investor-friendly environment.
She said that her government was addressing the high demand for pyrethrum seedlings in the county.
“Pyrethrum is now the cheapest crop to grow, and it has transformed the lives of many people. We shall fully support its revival,” said Ms Kihika.
The Governor expressed optimism that once the Kentegra plant is complete, it will create employment for tens of people and offer a ready market for their produce.
“Kentegra becomes the first company to invest in the new Naivasha EPZ, and this will help in breaking the cycle of unemployment,” she said.
Kentegra Biotechnology is set to receive Sh2.1 billion (USD 15 million) in equity and loan financing from Finnish development financier Finnfund and the United States Development Finance Corporation (DFC) to expand the firm’s production of pyrethrum flowers and revive the sector.
Kentegra Biotechnology produces and sells pyrethrin extracted from dried pyrethrum flowers to global insecticide and pesticide manufacturers.
Kenya’s pyrethrum business thrived in the 1990s but activity has dwindled due to competition from cheaper synthetic pesticides.
The loan proceeds will be used to expand the firm’s capabilities to produce pale refined pyrethrum extract, for working capital, and to access new international markets.
“The investments, totaling Sh2.1 billion (US$15 million) in aggregate, will enable Kentegra to process pyrethrum flowers from 90,000 small-scale farmers in Kenya,” said Finnfund in a statement.
Research conducted last year on the sector shows a growing demand for organic pesticides and ‘greener’ produced food.
Pyrethrin is used especially in the production of pesticides used in agriculture and households.
Ms Kihika expressed confidence that with DFC’s support, Kentegra will increase the percentage of women farmers it works with, providing these farmers with greater and more predictable income, as well as training to implement best farming practices and financial planning tools.
The new facility would create 600 direct jobs before the end of the year.
The firm is among privately owned firms that were granted a permit to extract, process, and sell pyrethrum products after the industry was liberalized seven years ago.
Other private pyrethrum processors who have been issued permits are Africhem Botanicals, Pypro, and HighChem.
Ms Kihika announced that Nakuru will allocate Shs.27 million in the next financial year towards revamping the Pyrethrum sub-sector.
She said her government had entered into a public-private partnership to revamp the production of pyrethrum in the region.
The partnership, the governor explained, will involve recruitment of new farmers who will be provided with seedlings in a strategy expected to take the county back to its former glory as a leading producer of pyrethrum.
Ms Kihika said the County was collaborating with the state-owned Pyrethrum Processing Company of Kenya (PPCK) and private entities to put up nurseries that will provide farmers with quality seedlings to increase acreage under the crop.
She added that the County was planning to cultivate 30,000 acres of pyrethrum in Nakuru, by supporting local farmers through the provision of high-quality planting materials that lead to increased yields and improved returns.
“Success of this project will also boost this region’s economic wellbeing,” added the governor.
Ms. Kihika said her administration will also avail sufficient land in pyrethrum growing zones of Molo, Kuresoi South, Kuresoi North, and Njoro Sub-Counties to enable PPCK and other private sector actors to set up crop nurseries in a plan aimed at lessening the burden of sourcing for seedlings from other regions.
The nurseries, she added, will grow the developed Nakuru Region Pyrethrum Clone that is disease-resistant and has higher pyrethrin content.