The Standard Group Plc is a multi-media organization
with investments in media platforms spanning newspaper print operations,
television, radio broadcasting, digital and online services. The Standard Group
is recognized as a leading multi-media house in Kenya with a key influence in
matters of national and international interest.
Hass avocado enjoys a huge domestic and international market, no doubt. [Photo, Standard]
The farming industry is littered with agribusiness investment companies promising ‘heaven’ to gullible farmers. You have read the headlines “how I quit my job to start farming” “how I make money by growing tomatoes in greenhouse” etc.
The adverts are all over — in the newspapers, social media, radio and TV. All you need is to pick your package and pay the requisite fee and sit back and wait for your money to germinate and blossom. No long working hours in the farm, no worry about pests and diseases. What is even sweeter is that the marketing that gives farmers sleepless night is now taken care of.
Who can resist such an offer if you have idle cash somewhere?
Unscrupulous investment companies are swindling potential farmers of their hard earned cash. While I agree the intentions are good and that indeed there’s money (lots of it) to be made from farming, it’s not always as easy as it sounds in those headlines. The companies are economical with the truth. Today, I’ll hand you the bitter pill.
First, farming is not for everyone and you’re better off with your patronising boss at times. Second, it’s not a get-rich-quick scheme. Commodity prices may be up, but the costs of producing those commodities are also high. Add weather risks to the equation, and there is no guarantee that you will get the lucrative returns being projected. Third, you’ve got to have the skill to succeed or be ready to learn. Let’s focus on easy ways potential agri investors can be duped.
Tomatoes in greenhouses
The most common touted opportunity is production of tomatoes in a leased greenhouse. Here, innocent farmers are promised returns in just six months after the investment.
On paper, it sounds a lucrative investment, but the projected returns make one to think twice. How is it possible to pay the invest more than Sh0.5 million from a standard greenhouse grown with tomatoes in 6 months? Numbers don’t lie. A standard greenhouse can produce an average of 6,000 kilos in a growing cycle of 9 months.
The price of tomatoes per kilo is not a secret. Choose your best price and compute the returns for yourself. Go further and determine the production costs in a production cycle. Now you can understand where I am coming from. The returns are not close to what you are promised. Just like a pyramid scheme, prospecting farmers are slowly losing their hard earned cash to fictitious companies in the name of investment.
Hass avocado
Hass avocado enjoys a huge domestic and international market, no doubt. What the investor is promising is what makes the enterprise suspicious. Here, you are enticed with one acre of already established Hass avocado orchard. Once you enrol, you're promised that you will be given detailed information on markets and management practices. You are promised that your returns will be more than Sh0.7 billion just after 8 years of investment. Just like the greenhouse tomato when you do the gross margins, the figures do not add up.
Green Investment
This is another common slogan used by the investment companies. Here you are enticed by the huge profits from tree farming. It is even touted as a better investment than a real estate. You are promised returns just after few years of investment. What is even interesting is how farmers are coached to give false testimonies.
Behind the good promises lies a big lie. It is not bad for agribusiness investment companies who are going out of their way to provide an opportunity for individuals who would wish to do farming to have access to land, and benefit from the pool of agronomist to manage their investment.
[The writer is an expert on sustainable agriculture and agricultural solutions]
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The Standard Group Plc is a multi-media organization
with investments in media platforms spanning newspaper print operations,
television, radio broadcasting, digital and online services. The Standard Group
is recognized as a leading multi-media house in Kenya with a key influence in
matters of national and international interest.
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