Catherine Riungu
23 June 2008
Kenya’s horticultural industry has registered record sales, living up to predictions made earlier in the year that 2008 was going to be a lucrative one for the sector — despite the fact that it is grappling with both a strong shilling and rising production costs brought on by escalating expenses of farm inputs.
Preliminary statistics show that sales for the first quarter this year have jumped 56 per cent over those for the same period in 2007, while volume has increased by 30 per cent.
The performance has consolidated Kenya’s position as the leading supplier of especially cut flowers to the European Union — commanding a 40 per cent of the market, with Columbia and Ecuador following at 25 per cent each.
Kenya Flower Council chairman Kabuya Muito said the results are a major achievement for a country whose economy almost ground to a halt following the post-election violence early in the year. It is estimated that the sector lost Ksh10 billion ($158 million) at the height of the violence.
A notable entry in the fresh produce exports list are khat shipments, mainly to Somalia and the United Kingdom, which outperformed last year’s first quarter exports by Ksh2.2 billion ($34.9 million).
Although khat exports are estimated at Ksh27 billion ($428 million) annually, the shrub has never been officially recognised as a commercial enterprise because of its controversial status in the world markets. In some countries, it is banned on health grounds while in others it is still generating heated debate on whether it should be allowed.
Kenya’s biggest market for the shrub is Somalia, followed by Saudi Arabia and the UK, where the debate has generated much of heat among scholars and health officials and in parliament.
The proportion of high value vegetable packs went up from 55 per cent to 89 per cent of total fresh vegetable exports, reflecting a marked increase in quality. This is attributed to increasing demand for ready-to-cook assorted packs as consumers in Europe look for products that fit with busy schedules.
Another driving force is the push for addition as exporters strive to maintain a competitive edge in a market that is becoming saturated with cheaper products from North African countries taking advantage of their proximity to Europe to beat Kenya on price.
The growth is also attributed to a continuing global preference for Kenya’s high quality products and reliability in delivery, said Fresh Produce Exporters Association of Kenya chief executive Stephene Mbithi.
KFC chief executive officer Jane Ngige said that efforts by the body to dispel fears that Kenya could not sustain long term supplies as the country wallowed in violence in January seem to have paid off.
“In January, we embarked on a communication exercise assuring the international market that the violence would not affect the delivery of our produce,” she said.
She added that until a deal was reached between the two main political leaders — President Mwai Kibaki and Prime Minister Raila Odinga — buyers were looking elsewhere for supplies, but were easily won back given controlling market share of the country, whose exit would have led to a massive shortages especially of fresh flowers.
The preference for value-added products is also evident in the flower industry, according to a report from the Kenya Horticulture Development Programme, a USAid-funded industry support project.
“More bouquets are now being shipped than before, with this quarter recording the highest increase,” said the report.
Expectations are high that horticulture will maintain its performance this year, boosted by the use of Eldoret International Airport to airlift fresh produce to Asia and to the Dutch Auctions.
It is also favoured by the growing demand in Europe where growers are scaling down production amid rising climate change concerns.
“It is becoming too expensive to grow flowers in Europe, where they artificially light greenhouses; the focus is now on Africa as the main supplier,” said Mrs Ngige.
Last year, Kenya’s horticulture sector earned Ksh70.3 billion ($1.1 billion) up 63 per cent from the previous year, becoming the highest foreign exchange earner after tourism and tea.
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