Nigeria’s AFEX makes East African Expansion, sets to empower 5000 Kenyan Farmers

AFEX, Nigeria’s leading commodities exchange and commodities market player, announces its expansion into Kenya, following a successful pilot phase in the most diversified economy in East Africa.

AFEX Fair Trade Limited (AFTL) has launched a $1million loan program to allow farmers access to fertiliser and seed to help them adapt to ever-rising commodity prices. Program will allow 5000 Kenyan farmers access to input loans that can be used to quickly scale up their business and get timely inputs.

Part of the company’s broader pan-African growth targets, the expansion will allow AFEX to replicate its success in Nigeria in securing better livelihoods for smallholder farmers and enable seamless access to pan-African commodities trading across the continent, while bolstering the continent’s food security.

Recently named first in the Financial Times (FT) ranking of Africa’s Fastest-Growing Companies – Agriculture & Commodities category 2022, AFEX is bringing its depth of experience, and unique storage and distribution solutions to Kenya, with a goal of trading over 500,000 metric tonnes of agricultural commodities by 2025.

As of November 2021, analysts estimate 7.9 million people in Kenya lacked sufficient food for consumption, which represents 15.4 percent of Kenya’s population.

AFEX’s unique platform WorkBench allows farmers to take part in market opportunities. The platform allows farmer transactions with AFEX’s network of warehouses to be executed and recorded, supporting seamless trade across the eight warehouses currently operational in Kenya.

AFEX Kenya’s new 14-strong team is headed up by Managing Director, Tabitha Njuguna, who oversaw its successful pilot phase, during which time maize was the main commodity traded. In the next few months, the exchange will be adding rice, sorghum and coffee.

AFEX found that Uasin Gishu County was in the North Rift region, Kenya. This led to many local farmers having to store their crops at their homes.

Producers often depend on middlemen, despite having high levels of mechanization as well as large land holdings.

AFEX began its pilot operations in Kenya in the fourth quarter of 2021. It has already achieved notable results with over 4,000 tonnes of commodities being traded and an estimated 7,100 people served by AFEX.

The Kenya expansion signals AFEX’s infrastructure commitment across the continent as it exports its business model to key strategic locations. In addition to Kenya, AFEX plans to expand to Benin, Togo, Ghana, Côte d’Ivoire, Tanzania, Ethiopia, Uganda, and Zambia within the next 10 years.

Having built itself from the ground up in an agricultural sector widely perceived as one difficult for businesses to operate in, AFEX is anticipating strong growth and significant measurable impact in Kenya’s relatively more developed agricultural sector.

Kenyan farmers tend to have larger holdings than their Nigerian counterparts. In addition, they have better storage facilities and distribution infrastructures.

Ayodeji Balogun, CEO at AFEX said, “This is one of the most dynamic commodities markets in the world and we are excited to work with Kenyan farmers to help them scale their operations.

We are well aware that growing food production without a reliable and robust warehousing infrastructure to support commodities trading is ineffective. Technology is critical to the development of Africa’s agriculture sector in the future.

“I started my career building capital markets in East Africa and understand the challenges of a fragmented supply chain, inefficient price structures and market volatility.

We’ve been massively encouraged by what we’ve seen since our pilot phase rolled out with thousands more farmers experiencing productivity, value capture, and access to structured mechanisms for commodity trading in Kenya.

With our experience of helping farmers to directly access markets, we’re uniquely positioned to help Kenyan farmers contribute to their national food security while ensuring sustainable development for future generations.”

Tabitha Njuguna, MD, AFEX Fair Trade Limited (AFTL) Kenya, added, “The technology powering our operations is one of the best on the continent and is instrumental to our capacity to provide access to logistics delivery, advisory services, inputs, and crucially, access to the market, which are all key to the future of agriculture in Africa.

We want to dismantle one of the biggest barriers for farmers growing their business – access to finance. So far, we’re delighted to have enabled 70 percent of the 5,000 Kenyan farmers who approached AFEX for input loans and we are committed to empowering many more farmers over the next few months.”

AFEX is a close partner with smallholder farmers. It uses its unique tech solutions for increasing yields and productivity.

The company has supported over 350,000 farmers in Nigeria’s major grain-growing regions. AFEX boasts a total of 126 warehouses in Nigeria, with a storage capacity exceeding 314,000MT.

Since its launch in 2014, AFEX has committed to levelling-up Africa’s agro-tech sector. AFEX helps to bridge the gap between Agro-processors (investors) and Agro-processors (processors). This increases food security and enhances food production.

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