ITC Shares

Kenyan avocado exporter becomes part of the processing

19 December 2019
Mujinga Tambwe, International Trade Centre

Direne Ltd. lands new customers, looks to add more as it builds facility and ITC helps it gain certifications

The month of May 2019 was a defining time for Direne Ltd., which exports Kenyan avocados and mangos. As a small firm the company was lagging far behind in accessing international markets.

The challenges it faced were typical of those that small and medium-sized enterprises (SMEs) have to deal with in most countries. Competing with larger enterprises is difficult for smaller Kenyan firms. Smaller businesses often fail to grow because of issues such as lack of capital. Their size and lack of resources get in the way of competing with larger companies in establishing a loyal customer base.

Seeking a solution, Direne Chief Executive Tom Owuor attended Macfrut, the international point of reference for the fruit and vegetable industry in Italy, in May.

He described it as a game-changing event. Participants made contact with buyers from Europe and Asia and some of these contacts translated into Direne receiving orders from those regions for the upcoming avocado season, starting in March 2020. Owuor then visited Hong Kong in September and acquired new Chinese clients as well.

In order to serve customers in those markets, his company is now applying for a number of certifications, including ISO 22000:2018 on food safety management and GLOBALG.A.P. agricultural certification. His efforts have been supported by the International Trade Centre (ITC) Market Access Upgrade Programme (MARKUP), a regional development initiative that aims to contribute to the economic growth of the East African Community (EAC).

Completion of these requirements provides access to new customers and ensures full traceability required by international markets.

At Macfrut, Owuor also had a chance to make contact with an Italian investor already active in Africa and wishing to diversify his activity into Kenya’s fresh and processed avocado market. This led to investment in a processing facility for fresh foods, mangos and avocados. By investing in new machinery, Direne will be able to diversify its product portfolio and reduce its reliance on fresh exports.

The facility will process three key products: frozen avocado, avocado pulp and avocado oil. While the latter will only be available at the end of 2020, the facility will be in full shape and ready to process the others by March 2020. The works at the facility will start in December 2019 and tests will be run until the beginning of the avocado season.

The vision for the processing facility is not limited to the future successes of Direne. Owuor would like to collaborate with public and private horticulture industry stakeholders to bring together producers and give them access to the processing facility for frozen avocado. The capacity of the facility could be to up to five containers a day for as many as 15 business partners.

Looking at the achievements of the past year, Owuor is confident about the potential of his new business venture and attributes this success to collaboration with ITC.