Twiga starts commercial farming, looking to ensure quality and maintain supply – TechCrunch

Twiga, an e-commerce food distribution platform, today announced the launch of its new subsidiary, Twiga Fresh, through which it will grow and distribute its own produce to merchants.

Twiga said it has started producing horticultural products such as onions, tomatoes and watermelons on its 650-hectare (1,606-acre) plot, with an estimated output of 150,000 tons of fresh produce a year. Twiga has so far invested $10 million in the new company, which will be backed by debt from development finance institutions.

Since its launch, Twiga has used technology to link small farmers with informal traders, giving growers access to new markets and large numbers of customers, all while optimizing the food supply chain in their markets. Along the way, though, Twiga says they’ve had to deal with challenges of traceability, stockouts and price volatility, which have made it difficult for the company to deliver on its promise of affordability and food safety. With Twiga Fresh, they project a better control of the production.

“Other fresh produce volumes were low because we made a decision not to scale fresh produce where we had no traceability from a food safety standpoint,” said Twiga CEO and co-founder Peter Njonjo, adding that the new business will not affect as many farmers.

Twiga said it will, however, continue to buy some products such as bananas, where the value chains are more “established and efficient”, from associated farmers.

The company says its farm is one of the largest fresh produce trading establishments targeting the domestic market, as most of the large-scale horticultural businesses in the East African country export their crops.

“Most of the Africa-based investment in modern commercial agriculture has been in export-oriented industry over the years due to the low formality of the domestic food market. This has led to a decline in the productivity of local agriculture, which has affected both quality and prices in the market,” said Njonjo, who founded the company with former CEO Grant Brooke.

“The current price of fresh staples is one of the highest in history and we are also seeing more staple food imports because of this. Through building a B2B supply chain in informal retail, Twiga has been able to formalize the domestic food market using technology, placing the company in a unique position to invest in backward integration and solve the problem of declining productivity and the increase in the cost of food,” he said. saying.

Beyond Kenya, Twiga is looking to start operations in Uganda and Tanzania, and also plans to explore new markets in Central and West Africa.

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