By Antynet Ford

Kenya’s rapidly expanding avocado oil industry is now so short of supplies it is battling with exporters for fruit supplies, driving up prices and causing a widening crisis across the industry.

The number of avocado oil processors in Kenya has risen from just three to over 70 in the last three years, triggering a near doubling in fruit prices and forcing new factories out of action on inadequate raw material supplies.

In an exclusive interview with FarmBizAfrica, the Co-founder, Director and Chief Finance Officer of longstanding avocado oil processor Crofts Limited, Mitul Shah, said the shortage was not simply a production failure, but the result of an industry boom that had outpaced the country’s fruit supply.

Until recently, Kenya’s avocado oil sector was small, stable and manageable, he said, with only three companies producing avocado oil nationwide and fruit supply following predictable seasonal cycles.

“The fresh export market was always the leader in demand. Even when more exporters entered the market, there was still sufficient supply of fruit for all players,” he said.

With a typical fresh exporter requiring about 4,000 metric tonnes of avocados a year, farmers sold fruit with minimal competition, and processors could plan operations with confidence. In most cases, the oil was processed from fruits classed as below export grade, making the two sectors complementary.

But the situation changed rapidly beginning in 2022, said Mitul.

“The change was relatively sudden. Prior to 2021 there were three producers of avocado oil in Kenya. Today, we stand at about 70 companies. For such a shift to occur within two to three years is certainly sudden,” he said.

“Oil companies were popping up everywhere and none seemed to consider the challenges in supply. It was all market-demand driven,” he said.

However, oil processors require far greater quantities of fruit than exporters. A single processor typically needs between 10,000 and 15,000 metric tonnes of avocados per year, nearly three times the demand of a fresh exporter. Thus, as more processors entered the market, demand quickly overtook supply.

As a result, “there is currently a fight for fruit between the two sectors,” said Mitul. Moreover, “the scarcity has affected the price of raw materials, thus impacting profitability.”

Processors have begun offering prices higher than exporters can afford, with the farm-gate price of avocados rising to around Sh60 a kg in 2025, from Sh32 a kg a year earlier.

The shortage has also encouraged premature harvesting, which has reduced oil extraction yields, with national yields now averaging around 4.5 per cent, where, with proper harvesting, they reach about 8 per cent.

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“A combination of high prices and low yields has not just affected profitability most companies have incurred losses,” said the CFO. Moreover, the shortages have become constant.

Although more avocados are produced overall, “export demand is consuming more, local consumption is rising, and oil processing demand has increased exponentially,” said Mitul, and “seasonality is being thrown out the window” as some process move to producing all year round.

For Crofts, this sees it now operating below factory capacity for roughly 80 percent of the year, with insufficient rains and pests now also worsening the raw material shortages.

“Disease outbreaks have now further reduced fruit availability,” said Mitul, pointing to the current persea mite infestation. “Some orchards will not produce any fruit as their trees have been decimated by the pest.”

As a result, Crofts Limited said it has reduced its seasonal workforce by about 15 per cent because the factory lacks enough fruit to process.

He also raised concerns about enforcement of harvesting regulations. “The regulations are there, but enforcement is lacking,” he said, alleging that immature harvesting continues even during official closed seasons, leading to quality issues.

“We have had to become extremely strict in our sourcing and reject any deliveries that don’t meet the required standard. However, other buyers still accept low-quality fruit, which encourages suppliers to continue harvesting prematurely,” he said.

“Immature fruit often fails to ripen properly, causing significant post-harvest losses. Fruit ends up rotting.”

Competition has also strained relationships with farmers. Processors report frequent contract breaches as farmers sell to the highest bidder.

“We have had instances where trucks went to collect ten tonnes and returned with less than two tonnes because farmers side-sold to brokers,” he said.

Because of this volatility, processors are increasingly establishing their own orchards and importing fruit from neighbouring East African countries.

“We feel we cannot rely on sourcing from farmers as prices are too volatile and quality is very poor,” said Crofts..

Mitul also said weak coordination between exporters and oil processors was worsening the crisis.

“There is a fight internally, and therefore the fresh export and oil processors do not engage on a professional level.”

He argued that stricter traceability rules and enforcement of maturity standards would stabilise supply and protect quality.

“What was once a predictable seasonal industry is now a scramble for fruit.The demand opportunity is real, but without coordinated supply management, the industry risks undermining itself.”

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