Cheap fertiliser beckons as Toyota kicks off Sh123bn Eldoret factory
Workers remove bags of fertiliser from a National Cereals and Produce Board store at its Eldoret depot for distribution to farmers in Uasin Gishu in June last year. PHOTO | FILE
What you need to know:
Toyota Tsusho is scheduled to complete the construction work by next year, with the first batch of NPK fertiliser expected to be produced by June next year.
The plant is expected to end the perennial shortage of fertiliser in the country, which has in the past exposed farmers to exorbitant prices.
Toyota Tsusho Corporation will today start construction of a $1.2 billion (Sh123 billion) fertiliser plant in Uasin Gishu, opening a window for farmers to buy the critical input cheaply from the maiden factory next year.
The plant will be built on a two-acre piece of land that the firm has acquired in Kapsaret, 12km from Eldoret. Toyota will expand the area under the plant to five acres as the farmer who sold the initial portion is willing to sell more land to the Japanese conglomerate.
Toyota East African chairman and adviser Dennis Awori said the two acres are sufficient to put up a plant, but they intend to expand in future.
“We are breaking ground for the construction of our fertiliser plant as we embark on a journey of putting up the first ever manufacturing plant in the country,” Mr Awori told the Business Daily on the phone.
The government estimates that the plant will cut the cost of fertiliser by about 40 per cent, or less than Sh2,000 per 50-kg bag. This will also save the government billions of shillings in subsidies.
The government spends Sh3 billion annually to provide farmers with low-cost fertiliser at Sh1,600 compared to market rate of Sh3,500.
Mr Awori said the plant would be close to the new bypass that connects Nairobi to other towns in western Kenya such as Kisumu and Kakamega, making it easy for them to get raw material to the site as well as transport finished products to the market.
The plant is expected to end the perennial shortage of fertiliser in the country, which has in the past exposed farmers to exorbitant prices.
Eldoret has been chosen as the location of the plant due to the high quantities of fertiliser that the North Rift region consumes, according to the government.
The ground breaking comes at a time when MEA Limited, a Kenyan-owned fertiliser blending firm, plans to put up a plant in Nakuru.
The firm is set to receive a Sh1 billion loan from the International Finance Corporation to fund a Sh3 billion fertiliser plant (the first of two in the pipeline) which it plans to start building in October.
MEA blends nitrogen, phosphorus and potassium (NPK) fertiliser from value-added raw materials (urea, potash and phosphate) shipped in from Europe, Saudi Arabia, Russia, Canada and Morocco.
MEA is also in talks with two Chinese firms — China National Chemical Engineering Company and SINOCHEM — to build a nitrogen fertiliser plant immediately the NPK one is commissioned.
The plant, to be located in Mombasa, is set to be operational in 2017 and will serve Kenya and regional markets like Malawi and Zimbabwe.
Acting Agriculture secretary Adan Mohammed said Toyota would complete the construction work by next year, with the first batch of NPK fertiliser expected to be produced by June next year.
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