Kenya Proposes New Levy and Tighter Controls on Horticulture Exports

The Kenyan government has proposed a new levy on horticultural exports, including fruits, vegetables, and flowers, aimed at promoting and regulating the industry to meet international standards on product quality and food safety. The levy, calculated on the customs value of exported produce, could put upward pressure on prices of Kenyan produce in overseas markets. According to the draft Crops (Horticultural Crops) (Amendment) Regulations, 2026, the levy will be 0.25 percent of the customs value.

The proposed regulations also introduce graduated levies on imported horticultural produce, with finished products attracting a four percent charge on import value, compared with two percent for fresh produce and raw materials. The higher charge on processed imports is intended to encourage local value addition. The levies will be remitted to the Agriculture and Food Authority (AFA). Businesses that fail to pay on time face interest of 25 percent for the first month or part of a month, followed by 12 percent compound interest for every subsequent month.

The export levy could affect one of Kenya's leading foreign exchange earners, with horticultural exports valued at Sh189.9 billion last year. Assuming the entire export value was eligible and subject to the levy, the government would have collected approximately Sh475 million from the proposed 0.25 percent charge. The proposed import charges would also affect traders bringing finished horticultural products such as fruit juices, tomato paste, preserved fruits, and canned vegetables into Kenya.

Beyond the levies, the draft introduces new compliance requirements across the value chain. Dealers, exporters, importers, processors, and packhouse operators will face registration or licensing requirements, while growers and dealers must maintain records showing where produce originates. Dealers will also be required to adopt an AFA-approved traceability system and establish procedures for withdrawing or recalling produce that poses food safety risks.

The proposals introduce an industry pricing committee, comprising representatives of growers, exporters, processors, marketing agents, and government, to recommend pricing formulas based on prevailing market rates and supply and demand. Grower-dealer agreements will also have to be submitted to AFA. Other requirements include the use of registered pesticides, potable water in post-harvest handling, regular inspections of handling facilities and transport vehicles, and packaging branded "Produce of Kenya".

The new rules would add to the costs of operating in the sector, with proposed annual fees including Sh5,000 for dealer registration, Sh5,000 for packhouse registration, Sh10,000 for an export licence, and Sh10,000 for an importer licence. A horticultural produce processing licence would also cost Sh10,000 annually. Europe remains a key destination for Kenyan horticultural produce, with the Netherlands, the United Kingdom, and France among the leading markets.

Listed agricultural firm Kakuzi is among Kenya's leading horticultural exporters, with avocados a key product. In the year ended December 31, 2025, the Murang'a-based company harvested avocados valued at Sh2.14 billion, a 26 percent increase from Sh1.7 billion the previous year. The company has historically supplied European retailers including Sainsbury's and Lidl. Tesco was also among its UK retail customers before suspending its relationship with the Kenyan exporter in 2020.

Key points

• The proposed levy on horticultural exports could put upward pressure on prices of Kenyan produce in overseas markets.
• The regulations introduce new compliance requirements across the value chain, including registration or licensing requirements for dealers, exporters, importers, processors, and packhouse operators.
• The proposed annual fees for licences and registrations would add to the costs of operating in the sector.