This Week in Agriculture

01 EDITOR’S NOTE

Hi!

Great to have you with us again, and for first-timers, welcome!

We hope that you’re finding something useful here, whether it’s a story that you totally relate to, an insight that helps you make a better decision, or an opportunity worth exploring.

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August is ending with agriculture facing a difficult balancing act.

Farmers are preparing for the next planting season at the same time as drought continues to affect this year’s harvest. The government is responding with cheaper fertiliser and certified seed, while also looking at maize imports to cover the expected shortfall.

At the same time, rising fertiliser costs and supply risks are making one thing clear: keeping agricultural production affordable and reliable is as important as increasing it.

For farmers, agribusinesses and investors, the question is what these developments mean beyond the headlines.

Here’s what caught our attention this week.

02 NEWS ROUND-UP

The government has announced a reduction in the price of subsidised fertiliser from Sh2,500 to Sh2,000 per 50kg bag, alongside a 50% subsidy on certified maize seed.

Under the new arrangement, the price of certified maize seed is expected to fall from around Sh300 to Sh150 per kilogramme from September. The government estimates that the seed subsidy will cost about Sh6 billion and cover roughly 40 million kilogrammes of seed.

The move comes as farmers in parts of the North Rift and other food-producing areas prepare to replant after significant crop losses caused by poor rainfall.

For farmers, the lower prices could make production costs considerably cheaper. For agribusinesses, the September and October planting window could bring a significant increase in demand for seed, fertiliser and other agricultural inputs.

But there is an important caveat: cheaper inputs only help if farmers can access them when they need them. How the government distributes the subsidised inputs, and the role private agro-dealers play in that system, will be worth watching.

Kenya’s fertiliser challenge goes beyond price.

The average landed cost of chemical fertiliser imports rose to Sh73,747 per tonne in the first quarter of 2026, up 19.5% from the previous year. At the same time, Kenya’s fertiliser import bill more than doubled to Sh30.04 billion.

The country has also faced shortages of subsidised top-dressing fertiliser, raising concerns that farmers may not be able to apply enough fertiliser at critical stages of crop growth.

That changes the question for farmers. It is no longer simply, “How cheap is fertiliser?” It is, “Can I get the right fertiliser at the right time?”

For businesses, this creates opportunities in local blending and manufacturing, storage, distribution, alternative fertilisers and technologies that help farmers use inputs more efficiently.

The government is trying to address two problems at once: the rising cost of production and a major production shock.

The North Rift’s maize harvest is expected to fall significantly, with some reports estimating a decline of around 30%. The region normally produces about six million bags of maize, making the impact significant not only for farmers but for the wider food system.

Since its introduction in 2022, the government says it has spent about Sh78 billion on the fertiliser subsidy programme, distributing more than 33 million 50kg bags to almost two million farmers.

The bigger question is what happens next.

Is Kenya moving towards a permanent input-subsidy model, or are subsidies being used as a temporary response to exceptional shocks?

Kenya is planning to facilitate imports of up to 25 million 90kg bags of maize, roughly matching the expected production deficit.

With the country consuming approximately 75 million bags annually, imports could play an important role in keeping the market supplied and preventing extreme price increases for consumers.

But timing will be critical.

If large volumes of imported maize arrive while local farmers are harvesting, they could result to lower farm-gate prices.

For grain traders, millers and logistics businesses, the import programme creates opportunities across trading, transport and storage. But profitability will depend on global maize prices, exchange rates, freight costs, government policy and the timing of local production.

Kenya’s pyrethrum industry offers a useful lesson in what happens when production and markets fall out of balance.

Farmers have been abandoning the crop because of poor returns and market challenges, despite pyrethrum having historically been an important agricultural export.

The lesson extends well beyond pyrethrum.

A crop can grow successfully and still fail to become a sustainable agricultural business. Farmers need dependable buyers, transparent pricing, processing capacity, access to export markets, appropriate finance and reliable support services.

For farmers, this is a reminder not to move into a crop simply because its current price looks attractive.

Taken together, these developments point to a broader shift in Kenya’s agricultural economy.

Drought is putting pressure on production. Fertiliser prices and supply are creating new risks. Government subsidies are helping farmers manage immediate costs, while maize imports are being considered to fill the gap.

But none of these measures addresses the underlying vulnerability on its own.

The longer-term opportunity may lie in building systems that make agriculture less exposed to individual shocks: better irrigation, local input production, storage, cold chains, processing, agricultural finance, climate-smart technologies and stronger links to export markets.

03 OPPORTUNITIES IN AGRICULTURE

I’m also excited to share with you a few event opportunities worth your attention this coming week!