Figure 4.18 Diagram showing current elements and issues at Mokowe Jetty

Consumption of fish and seafood is expected to increase more rapidly in Kenya, driven by population and income growth, though this will be constrained by supplies. A market study in 2018 identified a supply gap of over 80,000 tonnes per year, indicating that demand is currently around 28% higher than consumption110 .

Supply chain and location

Mokowe is the current central point of the fisheries supply chain in LC, with catch being delivered to the jetty for consolidation and trucking to Mombasa.

Small fishing vessels operating around Kiunga and north of Kiwayu, sell their catch to larger vessels (10 to 30 GWT) which anchor offshore and then travel down to Mokowe when full (after two or three days). These large vessels will have onboard ice-making/chiller capacity, while the small fishing vessels usually have no ice onboard.

Those vessels operating around Lamu and Pate islands generally deliver their catch directly to Mokowe or to agents and brokers operating on Lamu Island. Some of these vessels carry ice, but not all.

Limited access to ice (explained in section 4.3.3 and 4.3.2.1) and limited use, has added to the problem of post-catch losses.

The losses occur along the supply chain from the first storage onboard the fishing vessel, transfer and storage on a consolidation vessel, transfer to trucks and delivery to Mombasa, and the losses result in physical loss of product as well as degradation in quality and therefore value. While there are no studies into the losses in Lamu, indications from other work111 show that many of the losses could be reduced substantially through: > Local processing – avoiding trucking of fresh product to Mombasa; > Improvements in landing sites, providing cold storage before transfer to the processing facility; > Training in handling and storage techniques; and > Encouraging the use of ice onboard fishing boats

This VC will support action on reducing losses as part of its work to ensure quality control and traceability along the supply chain.

4.3.4.3  Indicative Costs and Revenues

Investment

The total investment required is estimated at around KES 350 million. Of this, just over 40% is for machinery and vehicles, and around 25% is for working capital. The remainder covers buildings and site preparation, marketing, and initial training.

Operating costs

Total operating costs are expected to be around KES 310 million at full capacity, with 70% of this being for the purchase of raw fish and seafood.

Figure 4.18 Operating costs 2026

350

KSh million 300

250

200

150

100

50

0

Utilities 40 Manpower 30 Packaging 23 Fish Purchase 219

Source: SUED Atkins Team

Human resources

Fish processing is a relatively labour-intensive activity, with significant jobs required for sorting, cleaning, filleting, deveining, packing, etc.

> Head count of 108 FTE in total; > Monthly salaries of KES 13,000 to KES 25,000 depending on skills; and > Additional employment costs estimated at 25% of salary.

110 Ipsos / MSINGI, East Africa fish market assessment, Size, Sustainability and Opportunities for growth in Aquaculture: Kenya, Uganda, Tanzania, and Rwanda (2018). 111 FAO, the state of world fisheries and aquaculture (2018).

Raw materials

The project economics are based on tomato processing:

> Average purchase price of fish and seafood is KES 175 per kg, paid at the landing sites (and collection points from fish farms); and > Packaging costs – plastic packaging, metal for the cans, labels, card boxes, etc., is estimated at KES 18 per kilo of processed fish and seafood.

Other Opex

Covers electricity, water and other utilities, maintenance of machinery, marketing and training. The opex also covers transport fuels and vehicle maintenance costs, (based on using one 20-ton refrigerated truck to make deliveries to Mombasa twice a week, and two small, refrigerated vans to cover movements of fresh fish between landing sites, farms, the processing facility, and the local market.

Revenues

Annual revenues are estimated at around KES 440 million by 2026. This is based on an average sales price of KES 500 per kg for processed and packaged fish and seafood products.

The estimate of total revenues excludes any revenues from dried processing waste going for animal feed.

Value added

The value added, calculated as sales revenues less the cost of the fish and seafood, and other inputs (packaging, electricity, water, etc.), is estimated at the equivalent of KES 125 per kg of fish purchased, representing over one third of the sales price.

Table 4.25 Value added

KES per kg of fish equivalent

Fish purchase price Other inputs (packaging) Other opex (power, fuel)

Value added 175

18

32

125

Sales price

Source: SUED Atkins Team 350

Enabling Business Environment and/or Other Catalysts

A broad range of actions are already being undertaken in support of the Blue Economy, and this VC then needs to work with a range of stakeholders. In particular, the VC should liaise with;

> NAMARET (the National Mariculture Resource and Training

Centre) in Kwale, for technical support; > Lamu County Implementation Unit, being established as part of the Marine Fisheries and Socioeconomic

Development Project; > Beach management units (BMUs); and > The established fisheries SACCOS at Shela and Faza Rasini.

4.3.4.4  Project 7: Fishing cluster and Mokowe landing site upgrade

Project overview

The fish processing plant VC is proposed to be located near the existing Mokowe jetty.

Mokowe jetty is the southernmost tip of Mokowe town and one of the most important communication and logistic linkages between the mainland and the islands. Current activities such as, collecting and unloading fish from local fishers, the loading of a wide variety of goods for onward transportation to Lamu Island and beyond, visitor ferries and other private boats to/from the mainland share the same jetty and onshore spaces. This shared and highly dynamic location is not actively managed, and therefore it risks becoming a bottleneck to the effective circulation of people and goods. It currently provides a very poor ‘gateway’ experience from the mainland to Lamu Island.

Access to the jetty is through the recently upgraded A10 that connects with the town centre and Hindi to the north. The A10 is also one of the key links expected to connect the LAPSETT Port and SEZ to the town.

On-going upgrade of jetty platform project – the existing landing platform (30x12m) is being upgraded and modernised (using reinforced concrete). The upgrade, however, is limited to the pier and does not extend to the wider area. The land area to the east of the jetty was recently reclaimed (circa 2010) with evidence of an operational quay in 2012.

Strategic role of the jetty and opportunity to establish a fishing based economic cluster – the area of immediate influence of the jetty covers approximately 2ha with a waterfront development of approx. 250m (east to west) and a variable in-land depth of 30 to 50m. The tidal pattern seems to vary by 1m (high/low) with the low ebb exposing circa 5/6 m of seabed. The site is currently managed in a reactive fashion; however, this offers the opportunity to rationalise spaces and circulation, appropriate uses and robustly plan for future managed growth.

Given the strategic input of the fishing industry to the local economy, a series of dedicated fishing facilities, both addressing current and future demand, could represent an attractive proposal. Expanding the local offering by capturing the wider fishing economy ecosystem such as a fresh fish market and restaurants, staff training and food-based entertainment could find space here. All these are added value activities to strengthen Blue Economy opportunities.

The fish processing plant should preferably be located adjacent to the Mokowe jetty. The plot can be accessed from the A10 road which connects the jetty to Mokowe. This location is chosen due to its proximity to the jetty and the sea, whereby being less than 200m from the jetty will allow the fish to be transported to the processing centre without further cold storage requirement.

The site is located on flat terrain with the access road to the north. There are mangrove forests located to the east and south of the general area where the site is located. As the site is located away from Mokowe town the issue of the potential impacts of fish odour will be mitigated as well.

The total area requirement for the fish processing plant is 4000 sqm. In the first phase 2000 sqm of this site is expected to be developed. It will comprise of 800sqm of buildings which include the cold storage, canning, smoking and other processing facilities and administration blocks. It will also include delivery docks, temporary parking areas and maintenance areas. In future phases when LAPSSET is active some of the deep-sea fishing catch will be transported to this site from Lamu Port for processing and further trade. For this function the rest of the site is proposed to be used and further facilities to be built as required. A feasibility study at the time of implementation is recommended. Proposals

The immediate opportunities of such a strategic location are:

1. To reconsider and rationalise uses and functions of the jetty and immediate surrounding area;

9. To establish two distinctive activity zones: a) trade and cargo and b) leisure and travel;

10. To futureproofing from a climate impact and economic resilience/opportunity perspective;

11. A fish processing plant development and operations.

By rationalising the uses and location of the future small harbour and splitting it into a) trade/cargo and b) leisure and travel, the site will naturally be developed and consolidated around these two activities.

On arrival from the A10, to the east, the harbour’s hustle and bustle takes centre stage. The quays are busy with cargo hauled on boats – the traditional activity of the area. As a backdrop, framing the quay, the fishing processing pavilion acts as a natural boundary to the site. Further east a new jetty frames the view if the bay.

To the west, a plaza and the jetty are framed by a series of simple, charming buildings hosting a fresh fish market, restaurants, and a visitor centre along with some small bed and breakfast facilities and other accommodations to host travellers before they move on to Lamu Island and the other islands and heritage destinations. Project components

Fishing-related activities:

> A fishing processing centre to capture additional value of the fishing trade: This can further expand into a dedicated pier immediately connected to the processing plant.

The allocated plot (4,000 sqm of land) should be sufficient to accommodate the long-term fish processing plant activities, including any additional demand (increased supplies) generated by future deep sea fishing vessels berthing in Lamu Port. An alternative access to the plot directly from the A10 is also proposed to minimise potential conflicts with cargo traffic accessing the East Quay; and > A fresh fish market and connected restaurants for visitors to address the retail demand and access fresh quality food (“sea-to-table”). A series of additional activities can be incorporated in such spaces, including socialising and entertainment areas.

Transport

> A new and properly consolidated bus stop/station and waiting area can be integrated on-site; > Distinct separation of movement flows in a) trade/cargo and b) leisure and travel.