KENYA – Kentaste, Kenyan specialist in coconut products, has received a US$1.5m financial backing from EDFI AgriFI, the EU’s investment facility dedicated to Agricultural SMEs in developing countries.
The financial support is aimed to provide the company with working capital to finance the expansion of its activities.
The company, which has Fairtrade certification, plans in particular to double the volume of coconuts currently processed at its factories based in Malindi and Kwale on the coast from 30,000 coconuts per day to 60,000.
“It is our ambition to be Kenya’s leading producer of high quality, premium branded products, manufactured using inputs from organic and fair-trade certified smallholder farmers.
“We are in a unique position to build a sustainable business that has, through our network of thousands of farmers, a major impact in the region that we operate in,“ said Kyle Denning, CEO of Kentaste.
Founded in 2008, Kentaste produces and distributes a wide range of coconuts-based products, namely coconut milk, coconut cream, coconut flour, virgin coconut oil and desiccated coconut.
The firm works with a network of 2,700 smallholder farmers the majority of whom are organic and fair trade certified.
Additionally, 30% of these smallholder farmers are women and a third live under the poverty line.
By allowing Kentaste to scale up, EDFI AgriFI intends to significantly impact smallholder farmers’ livelihoods as coconuts are the largest source of their household’s income.
“Kentaste has an innovative hybrid model focusing both on local sales and exports and has managed to build a leading brand in East-Africa.
“The project has not only an important social impact by creating added value and income opportunities in a rural area of Kenya but also has important environmental benefits since Kentaste promotes an agroforestry model via tree planting,” explained Guillaume Simoes, AgriFI Investment Officer at EDFI Management Company.
In addition, the company aims to at least double the number of farmers reached to date to between 4000 and 5000 by 2024 while focusing on women empowerment both internally and within its suppliers’ network.
The coconut oil brand has previously received financial support from DOB Equity, a Dutch family-backed impact investor in East Africa, to help it expand on the fast-growing demand for health-conscious coconut products.
According to Research and Markets, the global coconut products market was valued at US$11.5 billion in 2018 and is anticipated to reach US$31.1 billion by 2026, with a CAGR of 13.6% during the forecast period.
Increase in demand for coconut products such as coconut milk, coconut water, and desiccated coconut in the food & beverage industry is one of the major factors that drives the market globally.