In the vast agricultural landscape of Kenya, where millions of small-scale farmers toil tirelessly to grow crops, a significant challenge has always loomed large – the lack of proper markets for their harvests.
Early last year, Anthony Wambua, a visionary entrepreneur, identified this gap and decided to take action.
The result? The birth of Kingdom Grains Company, a game-changer in the Kenyan cereals market.
Here is his story as told by WoK.
Seizing the Opportunity
Having previously worked in Uganda back in 2008, where he often traveled to Rwanda and Tanzania, Wambua had a job that provided him with a unique perspective on the agribusiness landscape.
It was during this time that he keenly observed the market need in the agricultural sector. His experiences and insights would later prove invaluable in his entrepreneurial journey.
“When I came back, I worked for Cargill, an American global food corporation with offices in Kenya, and in as much I had experience in agribusiness, Cargill was a big eye opener for me because of the exposure I got to know the gaps in grains supply chain, more so on quality issues,” he says.
Many capable farmers lacked knowledge of post-harvest handling and minimizing losses, a critical aspect of the agricultural industry.
The Birth of Kingdom Grains Company
Fueled by his passion and driven by his desire to bridge this gap, Wambua founded Kingdom Grains Company.
The company specializes in bulk-sourcing various agricultural products, including maize, soybeans, chia seeds, red sorghum, and beans, among others.
Its unique approach involves sourcing produce from small-scale growers and traders in not just Kenya but also Uganda and Tanzania. These products are then supplied to millers and other bulk purchasers.
What sets Kingdom Grains apart is its comprehensive coverage of the entire value chain, right from the farm gate to delivering to buyers.
Quality is of utmost importance, and the company works closely with suppliers to ensure proper post-harvest handling, particularly to address the issue of aflatoxin contamination, which can jeopardize the entire value chain.
Challenges and Innovations
Operating in the competitive Kenyan business environment has not been without its challenges.
To maintain a steady supply of maize, Kingdom Grains has had to resort to importing from Uganda, despite the additional tax burden this incurs.
“We are being forced to import maize from Uganda, which attracts taxes because of the high cost of fertiliser in Kenya that makes production costs go up. Kenya is also a highly competitive business environment. The market is vibrant with many millers thus the cost of buying raw materials goes higher,” he says.
The high cost of fertilizer in Kenya has driven up production costs, making imports a more viable option. Furthermore, the market is fiercely competitive, with numerous millers vying for the best grain prices.
Navigating the logistics of collecting and delivering grains has also been a major challenge. Kingdom Grains relies on an efficient supply chain and an extensive network to ensure they have accurate information about grain sources and market dynamics at all times.
Adapting to Market Dynamics
The dynamic nature of the grain industry poses additional hurdles. For instance, the demand for soybeans in Kenya surged before the General Election in August.
The majority of soybeans come from Uganda, with smaller quantities from Malawi and Zambia.
In response, Kenyan buyers stockpiled soybeans from other countries. This fluidity in the market requires constant adaptability and strategic planning.
Looking to the Future
Despite being a relatively young company, Kingdom Grains has made impressive strides, currently handling about 1,000 tonnes of grain per week.
They are in discussions with Nakuru Business Association to potentially increase their weekly tonnage significantly.
To ensure the long-term sustainability of the business, Wambua is investing in post-harvest handling infrastructure, including tarpaulins for drying grains, moisture meters, and rapid aflatoxin testing kits.
Additionally, Kingdom Grains keeps its pricing competitive through regular updates informed by market intelligence.
To stay ahead of the competition, Kingdom Grains is focusing on smaller buyers, including restaurants, who require smaller quantities of high-quality grain. Maintaining quality and food safety is paramount in this market segment.
With a team of about 25 employees and a growing presence in East Africa, Kingdom Grains is not resting on its laurels.
They are gearing up to launch an e-commerce platform, ensuring availability and effective communication with their customers.
The Road Ahead
For aspiring entrepreneurs looking to venture into the grain value chain, Wambua offers sage advice.
“Anybody that wants to be in the grains value chain in Kenya, East Africa, and Africa has to tackle the issue of food safety and that has been our differentiating point even in these early days as a business,” he Says
