Kenyan flower farmers are moving to exploit a huge market potential by increasing their flower exports to the United States.
According to Kenya Flower Council chief executive officer Jane Ngige, Kenyan flower farmers are seeking ways to increase their exports to the US which have remained significantly low in the last two years.
Ã¢â‚¬Å“WeÃ¢â‚¬â„¢ve been exporting flowers to the US for a while now, but the quantities are not as significant as they should be,Ã¢â‚¬Â Ms Ngige said in a telephone interview.
She said part of the focus will be on increasing the production and export of big-headed roses to compete with Colombia that currently accounts for more than 80 per cent of flower exports to the US.
The global flower industry is dominated by a few major countries including Holland, Colombia, Kenya and Ecuador; the United Kingdom, Germany, the United States, Holland and France take 73 per cent of the worldÃ¢â‚¬â„¢s cut flower imports.
Colombian flower farms are favoured by the Caribbean countryÃ¢â‚¬â„¢s mild climate, relatively low labour costs, suitable transportation, favourable economic environment and proximity to the US to grow the American consumer market into its leading importer.
The Kenya Flower Council says it has been doing many promotions in major US cities like Miami and New York with the help of the Kenyan Embassy in Washington.
This move is meant to position the countryÃ¢â‚¬â„¢s flower industry to fully exploit the US market once direct flights from Jomo Kenyatta International Airport start to the US begin.
Ã¢â‚¬Å“Currently, we have some exporters sending summer flowers (those grown outside greenhouses) as another niche area we are exploiting to tap into the niche American market,Ã¢â‚¬Â Ms Ngige noted.
Currently, about 2,000 small-scale flower growers operating under Wilma Ltd are supplying roses to the US market. Industry players see this as a milestone for Kenya, which has for years tried to enter the US market without success due to stringent market requirements demanded by the United States Department of Agriculture designed to protect local production from new pests and diseases.
Ms Ngige said the export market has traditionally been dominated by big exporters, but this could change as the focus shifts to consolidating production by small-scale farmers with the particular target of the US as a niche market.
According to Fresh Produce Exporters Association of Kenya chief executive officer Stephen Mbithi, the country will focus more on exploiting the huge US market as a niche market.
Ã¢â‚¬Å“The US is a niche market which we have tried hard to enter,Ã¢â‚¬Â Mr Mbithi said in a statement, further noting that the challenge right now is to increase volumes and product range.
Kenya, just like Colombia, has received support from the US government to improve its flower industry. The countries have been receiving funding from sources such as the US Agency for International Development to increase productivity flower industry and in access markets.
But, Colombia seems to have gotten it right. According to Knowledge Wharton, all employees outside of Bogota are provided with a daily breakfast of sugar water and bread, a subsidised lunch of about $2.2 (Sh187) and free transportation to and from farms.
Farmhands are also given access to child care and continuing education (elementary and secondary) at an additional cost.
According to the Kenya Horticulture Competitiveness Project (KHCP), the labour costs of the Kenyan flower industry workforce are relatively high and continue to rise due to educated personnel. KHCP also cites relatively expensive sea freight rates to Europe, the major source market for KenyaÃ¢â‚¬â„¢s cut flowers.
Kenyan flower workers are paid about Sh255 ($3) per day compared to the less than Sh212.5 ($2.5) demanded by workers in Tanzania, Uganda, Ethiopia and Egypt.
Colombia is considering increasing the automation of many factors of production to reduce costs, something the Kenya flower industry can also pursue.
The US market, however, faces an oversupply of flowers given the high production capacity in Colombia that outstrips demand. This leaves Europe as a high potential market; it is now the biggest market for Kenya flowers. Currently, only about three per cent of flowers purchased in Europe originate in Colombia.
According to Knowledge Wharton, EuropeansÃ¢â‚¬â„¢ per capita consumption of flowers is much higher than that of Americans. On average, the Swiss spend $112 (Sh9,520) on cut flowers a year versus the $29 (Sh2,465) spent by the Americans. Knowledge Wharton suggests that Colombian producers have two primary options when entering the European market.
Ã¢â‚¬Å“They can ship the flowers directly from Colombia, or consider the multinational route and establish a production presence in Kenya. The former would help alleviate excess supply issues but add additional challenges related to distance and the perishability of the cut flowers. The latter would improve the physical proximity but present new challenges related to cultural differences, political instability and language barriers,Ã¢â‚¬Â Knowledge Wharton notes.
According to Ms Ngige, such a move would be very welcome if it makes business sense.
Source : abdas.org