KENYA – Kenyan agricultural firm Sasini is exploring new markets in Asia for its macadamia nuts after experiencing a significant drop in demand in the US. 

The company had to close its macadamia nuts processing plant in January last year due to the decline in sales, which plummeted from Kes858.5 million (US$5.28M) in the year to September 2022 to Kes151.3 million (US$930,956.31) in the same period of 2023. 

The sharp sales decline led to a loss of Kes97.7 million (US$601,152.89) for Sasini’s macadamia division during the review period.  

The company attributed this decline to a collapse in demand in the US, primarily driven by inflationary pressure affecting consumers’ disposable income.  

In its annual report, Sasini stated, “Whereas this demand is expected to come back in 2024, we will strengthen our USA trading of nuts by seeking new horizons to market our macadamia nuts in the Middle East and especially in Asia.” 

Sasini aims to reduce its reliance on the traditional US nuts market and plans to explore new markets as it prepares for new orchards to go into production in the next 18 months.  

The company’s macadamia nuts processing plant remains closed, awaiting a global demand upswing for the commodity, which is used as a snack and in various applications. 

During the review period, Sasini faced a drop in macadamia prices to Kes1,349 (US$8.30) per kilo, down from Kes1,720 (US$10.58) per kilo the previous year. Oversupply and reduced consumer purchasing power in developed economies contributed to the lower prices, impacting growers and processors across regions from Kenya to South Africa. 

Apart from the macadamia challenge, Sasini also recorded lower sales of coffee, declining from Kes2.8 billion (US$17.23M)to Kes1.7 billion (US$10.46) due to government-led reforms disrupting the sector’s supply chain. On a positive note, tea sales registered growth, rising to Kes3.4 billion (US$20.92M) from Kes3.2 billion (US$19.69M). 

Overall, Sasini’s turnover contracted from Kes7.3 billion (US$44.92M) to Kes5.7 billion (US$35.07M), leading to a significant reduction in net income from Kes1.1 billion (US$6.77M) to Kes542.5 million (US$3.34M). The company cited higher debt service expenses as one of the factors contributing to the lower earnings. 

In the short term, Sasini outlined priorities including the firming up of automation across its business units, particularly in the tea, macadamia, and avocado segments.  

The company also expressed its intention to engage with the government to advocate for business-friendly policies that support job creation, protection, and the overall growth of the economy.  

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