Flower exporters urge state to cut freight cost due to pandemic
Lewis Njoka @LewisNjoka
Flower exporters are calling on the government to lower the cost of exporting and make more freights available to mitigate the effects of Covid-19 pandemic on the industry.
They say the sector, which has been hit hard by the pandemic, needs urgent support to keep transport going.
In a statement, Kenya Flower Council said the available freight capacity in the country was too low and too expensive for most flower exporters.
Currently, the available capacity stands at 1,300 tonnes per week for all commodities against a demand of 3,500 tonnes a week.
Before the outbreak of the pandemic, freight capacity in the country stood at 5,000 tonnes a week.
With these constraints, flower exporters fear they may be unable to fully service flower orders for European Mother’s day to be celebrated this week.
“We can work with the bigger freight forwarders in Nairobi to attract some capacity, but it comes at a cost higher than the industry can afford.
A cost-sharing model to lessen the burden on exporters will go a long way in helping the sector survive this catastrophe,” said KFC chief executive Clement Tulezi.
“We, therefore, appeal to the government to expeditiously step in with short-term support, such as subsidising jet fuel for Kenya Airways thereby lowering costs for exporters.
This will also create traffic that could ultimately attract more freighters into Nairobi,” he added.
The pandemic saw most exporters stop shipping and carriers cancel passenger flights which resulted in increased demand for freighters globally.
“Airlines have increased their rates tremendously. They are currently charging more than double the initial cost from Nairobi to most market destinations. Exporters are unable to meet these exorbitant prices,” said Tulezi.
Kenya’s horticulture industry, the country’s third largest foreign exchange earner, has seen sales sink below 35 per cent due to coronavirus-related lockdowns in Europe, its main market.
Luckily global demand for flowers has begun to grow raising hopes of recovery for the Kenyan industry players.
Kenya’s cut flower industry employs more than 150,000 people directly and over one million indirectly, according to KFC.
Last year, the value of exported flowers declined by eight per cent (Sh9 billion reduction) to stand at Sh104.4 billion down from Sh113.2 billion recorded in 2018.
This was despite flower export volumes increasing from 161.2 million kilos in 2018 to 173.7 million kilos in 2019.
However, floriculture was still the highest foreign exchange earner among Kenya’s exports consisting of about 70 per cent of the horticulture export earnings.
As a whole, Kenya’s horticulture export earnings for 2019 reduced by Sh11 billion compared to the previous year, to stand at Sh142.7 billion down from Sh153.7 billion in 2018.