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Fipar Agro International has intensified its proposition to acquire Kenyan-based fertilizer company CFAO Agri Limited and enter Kenya’s lucrative fertilizer sector.

It follows an invitation to interested stakeholders by the Common Market for Eastern and Southern Africa (Comesa) competition commission for written representation, over the acquisition of 51 per cent stake of CFAO by Fipar, through a statement.

“The Commission will, in accordance with Article 26 of the Regulations, determine, among other things, whether or not the proposed transaction is likely to substantially prevent or lessen competition within the Common Market and whether the proposed transaction is or would be contrary to the public interest,” Comesa said in a statement on Friday, March 25.

Fipar, which is a subsidiary of a French-based agribusiness conglomerate with operations in over 100 countries, considers the investment as a strategic move to capture the local and regional fertilizer market.

The deal intends to use the Eldoret based plant to adopt products to fit local needs. The firm has an active presence in Egypt, Kenya, Libya, Madagascar, Mauritius, Rwanda, Sudan, Tunisia and Zambia.

The move is seen as a deal to bring experience and expertise in crop nutrition, accelerating and supporting the development of the Baraka fertilizers brand. It may also optimise operations through its industrial and “non straight” fertilizers expertise (Complex NPK and Blended specific NPKs).

This acquisition will make farmers optimistic having grappled with costly and limited fertilisers for years, despite the situation having been made worse in the wake of Ukraine-Russia tiff.

Russia suspended the exportation of fertiliser, reducing a significant portion of the global supply that has seen import countries seek alternative sources.

Farm input distributors in Uasin Gishu have been informing customers of plans to revise the prices of fertilisers upwards from mid-march. Diammonium Phosphate (DAP), the commonly used planting fertilizer, is the most affected brand, followed by Nitrogen, phosphorus, and potassium (NPK) and Calcium ammonium nitrate (CAN).

The prices of fertilizers are currently at their highest level since 2008, with DAP hitting Sh6,000 per 50kg bag and is expected to soar further if the tension persists and no subsidy is injected. NPK and CAN are currently retailing at Sh4,900 and Sh3,900, respectively.

Early this month, the agriculture Cabinet Secretary told the agriculture committee that farmers will have to contend with the current high prices of fertilisers until August as the docket awaits Sh31.8 billion approvals for subsidy.

The fertiliser shortage and high costs have added inflammatory pressures on Kenya farmers who are already burdened by the expensive fuel, weed-killing chemicals, crop seeds, and limited rainfall, threatening the country’s cereal production and overall food security.

“Kenya is currently suffering from a sharp increase in feed ingredient costs, ranging from 30 per cent to 70 per cent in 2021, varying by commodity. This crisis makes silage more attractive to farmers due to high feed prices,” the US Department of Agriculture (USDA) observed.

Farming in Kenya accounts for about a third of the annual economic output.