NAIROBI – The government of Malaysia is ready to facilitate its palm oil industrial players and business people to set up plantations in Kenya through partnerships and joint ventures in East Africa.
Speaking during the Malaysian Palm Oil Forum East Africa in Nairobi on Tuesday, Malaysian Deputy Prime Minister Fadillah Yusof highlighted the importance of the Malaysia-Kenya trade relationship, saying Nairobi is a vital market for his country’s palm oil in the region.
“Today’s event underscores the importance of Kenya as a trade partner. Kenya holds immense significance in the palm oil industry as demonstrated by statistics as the fifth largest destination for our nation’s palm oil export with a volume exceeding 763,000 tonnes in 2022,” DPM Yusof said at Kempinski Hotel in Nairobi.
The Malaysian Palm Oil Council said 95% of Kenya’s crude palm imports comes from Asia.
Kenya continues to be a major importer of Malaysia palm oil in sub-Saharan Africa, with a volume of 255,253 metric tonnes, which is 27,732 metric tonnes or 12.2% higher compared to the same period of 2022.
Kenya’s import of the palm oil also represents 26.4% of the total volume exported to the region. The increase in demand for crude palm oil, crude palm olein and cooking oil, as the main palm oil products to the sub-Saharan region, has provided a ready market for the Malaysian palm oil sellers.
It is among the major importers of cooking oil in Africa alongside Benin, Togo, Mauritania, Tanzania, Cote D’Ivoire and Senegal. In 2021, for instance, Kenya imported $1.26 billion (Sh177billion) worth of palm oil, becoming the ninth largest importer of palm oil in the world amidst Covid-19 pandemic.
“We encourage our industrial players and the business people to actively consider setting up plantations by way of partnerships through joint ventures in East Africa, particularly in Kenya. As government, we are ready to facilitate the arrangement between the businesspeople and provide technical support,” the Deputy PM said.
Elisha Kiplagat of the Kenya Chamber of Commerce said there are a lot of opportunities for the two countries, especially on trade.
“Looking at the statistics, there is balance of trade between the two countries and the two countries can benefit from each other,” Kiplagat said.
Former Mandera Senator Billow Kerrow, who is also chairman of the Edible Oil Subsector at Kenya Association of Manufactures, said there are significant and modern manufacturing factories for edible oil in Kenya.
“We import crude palm oil and manufacture through 13 major manufacturing companies here that have invested over Sh100 billion,” Kerrow told the media at the forum.
He, however, noted that the exchange rate that has seen the shilling lose about 30 per cent of its value in the two years is a concern that should be addressed.
The forum also featured prominent local industry players and international experts from Malaysia, Europe and Kenya.
On his part, Bidco chairman Vimal Shah, called on the government to keep the excise duty sector favourable to enhance more production.
There has been a push to increase palm oil production in Kenya to meet growing demand, with plantations emerging along river banks in Busia county but at the expense of forests.
The Kenya Agriculture and Livestock Research Institute, in this regard, has been undertaking research in Busia county. The program that was launched some eight years ago by Alupe KALRO centre to cut the cost of cooking oil, however, faced value addition challenges.
Alupe KALRO centre has over 300 oil palm trees on 10 acre piece of land, and according to research findings, there is great potential for oil palm production and other crops that have high oil components in Busia county.
The center produces quality palm seedlings that are sold to various farmers for planting. Due to its multiple benefits, the crop has attracted many people who would like to diversify from traditional staple food crops like maize.
“We produce seedlings for oil palm and have 3,000 seedlings ready for transplanting, besides 25,000 that we have propagated to be sold to farmers,” Patrick Mudavadi, the Director of Alupe Kalro center, said in January 2023.
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