Kenya’s horticulture earnings continue falling despite volume growth

KENYA – Kenya’s horticulture earnings have dropped by Ksh12 billion (US$101m) in 10 months to October, attributed to lower quality produce that attracted reduced prices at the global market amid competition from Latin countries.

The Horticultural Crops Directorate (HCD) has revealed that Kenya earned Ksh116.8 billion (US$1.04 billion) between January and October, down from Ksh128.8 billion (US$1.15 billion) last year.

The earnings declined despite growth in volumes, which was 16 percent higher than the previous period, reports Business Daily.

However, volume growth was not enough to offset the decline in value as Kenya’s produces were low priced when compared to those from Mexico and Peru.

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The drop marks the steepest decline in earnings for the horticulture industry in the last couple of years, raising concerns over quality standards, especially in the avocado sector where some farmers have been harvesting immature fruit.

According to the regulator, avocado accounted for the bulk of the produce that was intercepted as traders exported immature fruits, which impacted negatively on the earnings.

To this end, the directorate recently banned export of avocado from November 16 to curb the rampant practice.

In the review period, the value of fruits dropped to Ksh16 billion (US$142.92m) from Ksh17 billion (US$151.85m), while earnings from vegetables increased to Ksh22 billion (US$196.5m) from Ksh19 billion (US$169.72m).

The European Union still accounts for the largest portion of Kenyan horticultural exports, taking in 45 percent of the exports majorly comprising cut flowers, French beans, snow peas and Asian vegetables.

The leading export destinations are Netherlands, United Kingdom, Germany, Austria, Italy, France, Belgium, Middle East and the Far East.

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The trend on dipping earnings were also witnessed in June where income from the produces declined by Ksh6 billion in the first six months of the year, due to suppressed prices at the international market.

Volume of fruits, vegetable and flowers between January and June 2021, stood at 191,210,134 kgs, a rise from 160,931,659 kilogrammes traded in the previous corresponding period, earning Ksh77.2 billion (US$714m) from Ksh83.5 billion (US$773m) in 2020.

Fruits export earnings dipped to Kshs. 12 billion (US$111m) from Kshs. 12.5 billion (US$115.7m), while flower export earnings fetched Kshs. 50 billion (US$462m) compared to Kshs. 53.7 billion (US$497m) for the same period last year.

However, vegetable earnings rose to Kshs. 15.1 billion (US$139.7m) from Kshs. 12.2 billion (US$112.9m).

The directorate confirmed that interceptions, also contributed to low trading over the half year period and that last year the international market prices were high due to COVID-19 disruptions on air freight.

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