The edible oils segment covers any oil extracted from plants, animals and nuts for cooking and food preparation.
Edible oils, animal or vegetable fats, are fatty liquids extracted from vegetables and animal tissues. While palm oil is the most common edible oil, other edible oil products include Sunflower, Rapeseed (Canola), Soybean, Olive, Castor, copra, avocado oil, canola oil, corn oil, and Coconut oil.
Kenya's commitment to enhancing productivity and competitiveness in regional and international markets is evident through the prioritization of the edible oil value chain. Sunflower, canola, palm oil, coconut, animal fat (lard & ghee), soya, avocado oil and corn oils form the cornerstone of this vital subsector, which the government has identified for strategic development.
As highlighted in the Bottom-up Economic Transformation Agenda (BETA), the impetus for prioritizing the edible oils value chain stems from its significant contribution to Kenya's food import bill. In 2023 alone, Kenya imported crude edible oils worth Kshs.102.3 billion, mainly from Malaysia and Indonesia. To tackle this challenge, the Government, through the Agriculture and Food Authority, has formulated the Edible Oils Crops Promotion Project (EOCPP) to boost production of the edible oil crops in various Counties.The project is a 5-year initiative valued at Ksh. 981 million, co-funded by The National Treasury to a tune of Ksh. 400 million and Agriculture and Food Authority-Nuts and Oil Crops Directorate (AFA-NOCD) at Ksh. 581 million. AFA-NOCD is the lead Agency in implementing this project. Other activities in the project involve collaboration with State Departments, Agencies, and County Governments.
The EOCPP project is set to provide crucial support, including certified sunflower seeds, assorted seeds (canola, sunflower, soya), and coconut seedlings, and financial assistance in loans to farmers in key Counties. Notably, as part of sunflower promotion, the Agriculture and Food Crops Authority- Nuts and Oils Crops Directorate has procured 500,000 MT of sunflower seeds worth Ksh. 250 million for distribution to farmers during the long rains.
The Government, through AFA-NOCD, is creating awareness and encouraging farmers to plant edible oil crops to enhance production. The AFA-NOCD, is organinizing the National Coconut Week 2024 themed "Coconuts, Our Wealth and Livelihood," that is set to be launched on 17th April 2024 in Tezo, Kilifi County. The week will comprise of National Consultative Conference, that will be held on 18th and 19th April 2024 at the Kilifi Convention Center and Coconut Tree Planting Activity from 20th to 26th April 2024 where 70,000 coconut seedlings will be distributed to farmers across the six coastal counties of Mombasa, Kwale, Kilifi, Taita Taveta, Tana River and Lamu. The event serves as a platform for collaboration, investment, and innovation in the coconut industry, fostering sustainable growth. This, together with other initiatives in the Edible oils’ subsector, is expected to spur growth in quantities of edible oils produced from 80,000 MT in Financial Year (FY) 2022/2023 to 400,000 MT in FY 2027/2028 and growth in total export value of edible oils from Ksh. 26,948 million in FY 2022/2023 to Ksh. 34.934 million in FY 2027/2028 as enshrined in the Fourth Medium Term Plan 2023-2027.
The Kenya Export Promotion and Branding Agency's (KEPROBA) collaboration with stakeholders plays a pivotal role in supporting the development of the edible oils value chain. Through customized programs, exporters are made aware of recent trends and helped in packaging, labeling and branding of their edible oils products. Further, the Exporters and acquainted with the consumer preferences trends and vast opportunities for the edible oils subsector in the regional and international markets, to further bolstering the subsector's growth trajectory.
Specifically, the Agency targets promotion of edible oil products in the East African Community (Uganda, Rwanda, Tanzania, South Sudan, Democratic Republic of Congo and Burundi) and leverage on the African Continental Free trade Area (AfCFTA) to promote the subsector’s products in Zambia and Malawi. Prioritization of these markets is informed by the potential for growth of Africa’s edible oils market. According to Statistica 2024, the African market for edible oils is expected to grow annually by 10.52% (Compound Annual Growth Rate (CAGR) 2024-2028), with the volume expected to amount to 2.28 billion Kg by 2028. This volume is expected to grow at 4.9% in the year 2025.
The Kenya’s edible oil exports is largely comprised of palm oil, margarine, Fixed vegetable fats and oils, sunflower oil, ground nuts oil, among others. These products have great export potential in the priority markets as summarized below:
- Sunflower Oil (HS 151219) has export potential to Rwanda, Djibouti, Tanzania, Ethiopia and Uganda
- Sesame Oil and Fractions (HS Code 151550) has export potential to USA, Netherlands, United Kingdom, France and United Arab Emirates
- Margarine Oil (HS Code 151710) has export potential to Uganda, Tanzania, Malawi, Rwanda and Zambia
- Fixed Vegetable Fats and Oils (HS Code 151590) has export potential to USA, Ethiopia, Netherlands, DRC Congo and India
- Fats, Oils & Fractions n.e.s (HS Code 151800) has export potential to Netherlands, United Kingdom, Spain, Burundi and Finland
- Soya Bean Oil (Exl Crude) & Fraction (HS Code 150790) has export potential to Tanzania, Rwanda, Zambia, and DRC Congo.
In essence, the concerted efforts of the government, industry players, and stakeholders signify a promising outlook for developing the edible oils value chain in Kenya. By fostering collaboration, investing in innovation and promoting sustainable practices, the nation is poised to reduce its import dependency and become a significant player in the global edible oils market.
Call to action
Interested persons can register for the coconut week event tenable in Kilifi county through https://www.coconutweek.org/
KEPROBA urges stakeholders in edible oil participate in this crucial forum and any enquiries can be forwrded to [email protected]