Affinity in East Africa: Marrone Bio Innovations Finds Harmonious Partner in Kenya Biologics
Farmers in East Africa are set to benefit from a wide range of zero-residue biopesticides that will help to increase food production and allow the region’s produce to more easily access the lucrative European Union (EU) market.
This comes after Marrone Bio Innovations, based in Davis, California, entered into a distribution partnership with Kenyan firm Kenya Biologics that will enable the U.S. giant to sell its wide range of biopesticides in Kenya and Tanzania.
Although Marrone already has a presence in Africa, the company, which provides bio-based pest management and plant health products for the agriculture, turf, water treatment, and ornamental markets, hopes to increase its footprint in a continent where agricultural opportunities have not been fully exploited.
Despite being endowed with a vast mass of land, booming young population, and tropical climate, Africa accounts for only 2% of the world’s total agricultural exports, down from 8% in the 1970s, while remaining a net importer of food.
The African Development Bank reports that the continent’s food import bill stands at $35 billion annually and is estimated to rise to $110 billion by 2025 if Africa does not prioritize agriculture.
Marrone, which has been looking for a strategic partner in East Africa, settled on Kenya Biologics, which not only has a wide distribution network but also has been focusing on low-chemical products.
The two companies started the partnership talks about six years ago when Marrone first expressed interest to venture into the East Africa region. However, because Kenya Biologics was a relatively new company with a limited distribution network and small turnover, the company appeared unattractive.
The deal materialized after Marrone recognized Kenya Biologics’ exponential growth, which has seen the firm grow its distribution network, increase turnover, and amass a customer base of 13,000 across all farm sizes.
Besides Kenya and Tanzania, Kenya Biologics also exports products to Uganda, Zambia, and Zimbabwe and is aiming to reach more than 50,000 farmers in the next five years.
Of note, one month after the October signing of the partnership agreement, Kenya Biologics was acquired by Swiss group Elephant Vert — a transaction that not only widens its distribution network but also offers it the financial muscles to drive growth and engage in more research and development.
“Marrone wanted a likeminded partner that focuses on products with very low chemicals or no chemicals at all so that farmers can reduce the chemicals on their crops. This is an area that Kenya Biologics has an edge,” Chris Kolenberg, CEO of Kenya Biologics, says.
Kolenberg adds that, since his company’s establishment in 2007, Kenya Biologics has been producing agro-products with very low concentrations of chemicals to help horticulture farmers easily access the EU market, which supports the strategy of Marrone, whose products have zero-chemical residues.
The firm’s strategy is to look for natural-existing microorganisms that it uses to develop its range of products that are more resilient against local pests and diseases.
Despite the horticulture subsector being a critical contributor to Kenya’s economy, farmers are feeling the strains of dwindling yields and strict EU regulations on imports amid the growing problem of crop pests and diseases.
The Kenya National Bureau of Statistics reports that horticulture is now the fastest-growing agricultural subsector in Kenya in foreign exchange earnings, behind tourism and tea. In 2016 horticulture earnings stood at a record high of $100 million, contributing 1.4% of the country’s gross domestic product. The subsector also employed more than 2 million Kenyans.
Of note, Kenya is the second-largest exporter of French beans and peas to the EU, as well as a key supplier of cut flowers globally.
Despite the subsector’s importance to the economy, pests, such as the African bollworm, thrips, fruit flies, and aphids, that attack crops ranging from onions, tomatoes, French beans, garden beans, melons, and passionfruits have become a constant menace to farmers.
The pests, coupled by various diseases, are wreaking havoc when farmers are struggling to increase yields at a time when threats of climate change are impacting negatively on agricultural production.
“Horticulture farmers in Kenya have huge problems with pests, particularly thrips,” Kolenberg says, “and Marrone has a good product against the pest, which we intend to push aggressively in the market.”
He adds that the products from Marrone, which fall under the company’s microbial product range, will be largely targeting the large-scale farmers due to affordability.
“Marrone products are a bit high-end compared to local products in terms of price rage,” Kolenberg says, adding that, although Kenya Biologics has not started selling the products, it has already received the permit to import and carry out toxicological, eco-toxicological, and efficacy trials.
The firm expects to commence selling the products in the next 18 months due to the long and tedious process.
Although competition in the agro-chemicals industry is stiff not only from local manufacturers but also from importers from countries such as China and India, Kenya Biologics is not perturbed. It has managed to cut a niche by targeting professional farmers who are keen on the products they use.
The Kenyan market is flooded with imports because of the zero-rated tax regime for formulated and packaged products.