Kenya sets US$0.75/kg minimum price for macadamia purchases to protect farmers
Kagwe noted that strengthening cooperatives improves bargaining power and reduces broker influence.
KENYA – Agriculture Cabinet Secretary Mutahi Kagwe has directed macadamia processors to purchase all locally produced nuts at a minimum price of Sh100 per kilogram (US$0.75/kg), warning that failure to comply could lead to a reversal of restrictions on raw in-shell exports.
The macadamia market has been affected by intermediaries, with some farmers receiving as little as Sh30 per kilogram (US$0.23/kg).
“The intention is not to punish processors, but to ensure the farmer is not the weakest link in the chain. If processors cannot take what is produced locally, then we will have to reconsider export restrictions,” said Kagwe.
For Kenyan farmers, the government balances processor regulations with export policies by threatening to lift raw-nut export bans as leverage. Domestic processors must meet the minimum price and purchase all available local production.
Otherwise, exporters will be allowed to buy directly from farmers, bypassing processors entirely. Consequently, processors face clear pressure to comply or risk losing their supply advantage.
On the other hand, Cooperatives play a central role in protecting farmers’ incomes. Kagwe noted that strengthening cooperatives improves bargaining power and reduces broker influence.
“Government cannot continuously write off debts when there is no clarity on how those funds were used. That cycle is not sustainable,” Kagwe said.
He urged cooperative members to improve leadership quality, adding that weak governance is one of the main reasons some factories are struggling.
In addition, the state is also addressing financial accountability by demanding greater transparency in cooperative management.
For instance, Kagwe cited cases in which factories had accumulated heavy debts without clear audit trails showing how borrowed funds were used. Therefore, cooperatives must now demonstrate structured business plans and repayment capacity before receiving government credit.
Furthermore, the theft of high-value crops, including avocado and macadamia, has been categorized as economic sabotage. “Avocado and macadamia theft must stop by all means. Any activity that undermines agriculture is economic sabotage,” Kagwe said.
As a result, protecting production is directly linked to maintaining confidence in rural systems and in export performance.
For fresh-produce stakeholders, Kenya’s macadamia intervention illustrates a broader trend: governments are increasingly regulating agricultural value chains to stabilize farmers’ incomes and eliminate exploitative practices.
Processors and exporters should anticipate tighter compliance requirements, while cooperatives must strengthen governance to access credit.
Finally, theft prevention and supply-chain transparency will define success in Kenya’s high-value nut and avocado sectors.
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