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Kenya flower farmers bet on higher earnings as direct sales rise

BY Nicholas Waitathu
Updated Monday, June 3rd 2013 at 09:14 GMT +3

By Nicholas Waitathu

NAIROBI, KENYA: Cut flower farmers in the country stand to rake in huge profits as international buyers begin to buy their produce directly.

Direct sale of cut flowers has risen recently, a trend the Kenya Flower Council (KFC) says is a result of changing dynamics in the global market in response to current consumer trends.

According to the Economic Survey 2013, the cut flower sector earned the country Sh65 billion last year, up from Sh58.8 billion in 2011.

Lead Exporter

Kenya is the lead exporter of rose cut flowers to the European Union, with a market share of about 38 per cent.

Approximately 65 per cent of exported flowers are sold through Dutch auctions for re-export, with the United Kingdom market buying 25 per cent of the produce and other segments, including Japan, US, Russia, France and Germany, taking up the rest. “Over 25 per cent of exported flowers are delivered directly to these multiples, providing an opportunity for value addition at source through sleeving, labeling and bouquet production,” KFC Chief Executive Jane Ngige said in an interview yesterday.

The main cut flowers grown in the country are roses (87.7 per cent), carnations (7.4 per cent) and alstromeria (1.8 per cent). Other flowers cultivated include gypsophilla, lilies, arabicum, hypericum, statice and a range of summer flow- Kenya Flower Council notes that growers have the opportunity to make more money through value addition.  However, growers have to foot the cost of logistics and packing, which the buyer on the other side demands.”

Ngige added that last year’s International Flower Trade Exhibition (IFTEX), the first of its kind held in Kenya, also helped boost direct sales. This year’s event is scheduled for next month in Nairobi.

Rapid growth

The organiseer of the exhibition, Mr Dick Van Raamsdonk, noted that the success of the first exposition was an indication that the Kenyan flower industry is growing impressively locally and internationally.

“Kenya is the only country in the world where the production area of flowers structurally increases, a strong indicator that the sector overall is in a good shape,” he said. To exploit the rise in direct sales, Ngige called on growers to form marketing firms and team up with exporters.  “This will give the farmer better returns compared to what they get through Dutch auction exports. However, growers have to foot the cost of logistics and packing, which the buyer on the other side demands,” she said. Ngige added that this would also help the sector cope with the Eurozone crisis. “We are still exporting good volumes as a result of high demand, but returns are very low,” she said.

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