Apr 16, 2007

African farmers benefit from organic production

When Bill Yeager first encountered the Kenyan farmers that would be supplying his new organic produce company, he was met with a song that, translated from Swahili, said: “We welcome the foreigner who will bring prosperity to our tribe.”

“It was one of the most emotional things that has ever happened to me,” Yeager said. “It made me resolute not to screw this up.”

Yeager – a software engineer by trade – doesn’t have an agricultural background, but he does have a passion for Africa. The son of a Christian missionary, Yeager lived in Kenya between the ages of 7 and 11.

“It’s always been home in my heart,” he said.

Yeager said he’s always envisioned himself a businessman, and the software design gig wasn’t making him happy. So he began to look for ways to fuse a business model with his love for Kenya. The African country is desperately in need of foreign investors, Yeager said. About 40 percent of the Kenyan population is unemployed and 50 percent live in poverty.

The only way he could help was to take a trip to the continent. During the 16-hour ride over rough roads from the capital city of Nairobi to the lush, volcanic region near Mt. Elgon, Yeager saw mile after mile of farmland growing subsistence crops without the use of chemicals – primarily because the farmers were too poor to afford the pesticides. He realized the Kenyan farmers were growing “organically” to survive – but in the United States, consumers were paying a higher price for produce grown the same way.

Yeager started Yeager Kenya, an organic produce company, about two years ago. It now has a staff in Nairobi and four full-time employees in the Mt. Elgon region, near the border of Uganda and Kenya, where the company’s organic farms are. The company’s first crop of red creole onions will be ready to harvest in June, and as new farmers are added to the program he wants to expand the lineup to include pineapples, green peas and peanuts. Many of the farms have dormant coffee plants on them, so Yeager is working on gaining fair trade certification for coffee beans, in addition to the organic certification.

The onion seeds were planted about a week later than he’d planned, but he said you have to be flexible.

“That’s just the cost of doing business in Africa,” he said.

Kenya has one of the most stable governments in Africa, but that might not be saying much. In late January, when Yeager’s farmers were supposed to be planting their seed, a nearby riot resulted in a government crackdown. In Kenya, that means the military shoots first and asks questions later – if at all.

This particular incident involved a land dispute, and when the military started shooting, the local citizens ran for the hills – and to the organic farms. About 50 were killed, but Yeager said none of his farmers or employees were injured.

After the shootings, Yeager’s friend and president of U.S. operations for Yeager Kenya, Jane Wachara, told him: “This is why no one wants to invest in Africa.”

But it hasn’t deterred Yeager from growing the organic business. He’s raising funds to build a packinghouse, which has to be finished by the June harvest. The building will cost between $50,000 and $60,000, and although it might have been easier to use a prefabricated building, it would have gone against the mission of the company.

“The whole thing we’re trying to do is create jobs in Kenya,” Yeager said.

So far, he’s created jobs for about 1,200 farmers. About 70 acres on 76 individual farms have been certified organic by a German agency. Training, which the certifiers required, was underway in February for the next group of 150 farmers.

Gaining organic certification was more difficult in Africa than it might be in the United States. Because there are few good roads, most of the produce is transported by donkey to a loading point, and from there is taken by truck to the port of Mambaza, a two-day drive.

The inspectors said almost immediately that the burlap bags carried by the donkeys on the dirt roads wouldn’t be certifiable, so Yeager had to buy 26 custom-made leather bags that could be locked. They set him back about $200 each.

“I thought it was strange, but our certification depended on it,” he said.

He’s already developed contacts in Uganda – the country directly west of Kenya – and he said that looks to be one of the next expansion areas for the organic operations. He’s not just looking at produce, though. He’ll be traveling to Kenya in late March to set up an IT outsourcing company. During his travels, he came across many people that had college degrees and certification from computer companies – including Microsoft. His goal is to have a self-supporting technology company that can handle the bookkeeping for the organic produce company.

Yeager’s goal is to help Kenyans by changing the economics of the area. The farmers around Mt. Elgon make about $300 a year, but if there is a foreign market for their organic goods, they’ll make as much as $10,000.
“It’s the kind of money they’ve never even dreamed of,” Yeager said.

He plans to use profit from the company to build schools, medical facilities and help develop the infrastructure of the region. The money the farmers make also would help invigorate the area because they’ll have money to spend with other businesses.