The Kenya Flower Council (KFC) celebrated its 10th year representing the country’s flower growers last week, conceding that the last 12 months have been challenging for the sector.
Increased production costs, such as transport, which has risen on the back of a 300 per cent global increase in fuel costs, and labour, have taken their toll, according to council chairman Erastus Mureithi.
Export volumes for the first half 2006 were up from 48,000 tonnes in 2005 to 50,000t, but foreign exchange fluctuations and a strong shilling saw value down by around 15 per cent.
However, despite the challenges, Mureithi said the cut flower industry is in good health. It is the single fastest-growing sector of the Kenyan economy, increasing 150 per cent over the last five years, and is the lead cut-flower supplier to the EU, responsible for 31 per cent of the market.
Since it was formed in 1996, KFC has grown from five founder members to 47 farms and 15 associate members, representing nearly 70 per cent of the national cut-flower harvest.
The last decade has seen the industry grow from exports of 35,000t of flowers to a forecast 88,000t this year.
Mureithi said the industry is aware of China’s progressing flower export industry, heavily subsidised by its government, as well as the rising competition from Ethiopia.
He also warned about the uncertainty of the outcome of the Economic Partnership Agreement negotiations taking place between eastern and southern African countries and the European Union.
“Kenya, which has a successful horticultural industry, is the only country not classified as least developed among negotiating countries. We will be the main loser if these negotiations fail and we will become liable for the payment of tariffs and duties for our horticultural exports into the EU. January 2008, when the Cotonou Agreement expires, is just around the corner,” he said.
