Kenya : Technical Due Diligence
Macadamia nut
Fambolena carried out a technical due diligence mission for the Land Degradation Neutrality Fund (LDN) around macadamia nut production in Kenya. Our task was to assess the feasibility of the development plan of a Kenyan company backed by a Swiss-based group.
With a production of 42,562 tons in 2021, Kenya is the third largest producer of macadamia nuts in the world. Its particularity is that this production is essentially made by small producers who market the nuts without their gangue but fresh (wet nuts in shell) to operators who dry, shell, sort the nuts and vacuum pack them.
The company that was the subject of the due diligence mission is an intermediate-sized player (2,300 tons per year) and one of the few players in Kenya to have developed direct relationships with producers. It has a network of 3,942 small producers, 70% of which are certified organic and Fair Trade. It has a processing unit in Nairobi, which has a capacity of 4,000 tons per year. It has a quality control and microbiological analysis laboratory and is FSCC 2200 certified.
The takeover by the Swiss group has resulted in profound changes in the company's management team and strategy. The company's ambition is to collect 8,000 tons by 2026 and has applied for financing from the LDN fund to support this development.
Following a document review and preliminary interviews with the company's managers, we traveled to Kenya to visit the packaging plant in Nairobi, the macadamia plant nursery near Meru, visit plantations and meet with producers and the team on the ground around Mount Kenya and in the Taita Taveta region in the south east of the country. We have :
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Analyzed the prospects for macadamia nut production in Kenya
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Assessed the company's ability to meet its objectives of collecting fresh nuts from producers;
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Analyzed the adequacy between these objectives and the capacity of the nut processing tool;
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Evaluated the solidity of the traceability system in place as well as the reliability of the quality controls
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issued recommendations both on the organization of the collection and the relations with the producers and on the improvement of the industrial tool. Issued
Particular attention was paid to the impact on the company of the modification of the European regulation on the organic certification of imported products.
