KENYA – Kenya’s horticultural export revenue for the first half of 2023 is reportedly steadily rising, thanks to a recent increase in the value of the euro, as revealed in a report by the Central Bank of Kenya (CBK).
According to a sales report analysis by the CBK, Kenya reached 69.48 billion in its January through June export revenue, marking a 7.16 percent increase compared to the same period last year when export revenue amounted to Ksh. 64.84 billion.
Kenya’s horticultural export market is heavily linked to the strength of the euro because 70 percent of the exports are paid in euros – only about a fifth of the shipment is paid in British pounds.
Consequently, Kenyan fresh produce exporters to the Eurozone had a profitable period when the value of the euro increased by 16.54 percent against the Kenyan Shilling in the first half of the year.
Among the horticultural produce analyzed, the export revenue of cut flowers experienced a 9.02 percent increase during the period in question, equivalent to Ksh. 33.53 billion. Fruits and nuts also saw a 9.42 percent increase, while vegetables, unlike its counterparts, maintained a steady revenue of Ksh. 14.25 billion earnings compared to the previous year’s 14.26 billion.
Further contributing to the rebound are currently moderated inflation pressures caused by the stronger euro. Europe’s economic growth, like that of other thriving global economies, is still in the process of recovering from the economic impact of the Covid-19 pandemic and the Russia-Ukraine war, which occurred consecutively.
According to recently released data from the European Statistical Office (Eurostat), the average inflation in the Eurozone for the first half of 2023 is 7.08 percent, which is only slightly lower than the previous period’s 7.10 percent.
2021, however, recorded an average annual price growth of 1.43 percent in the first half of the year.
The high inflation pressures witnessed in 2022 had a significant impact on impacted households, forcing them to cut cost on luxury such as cut flowers resulting in major losses in the industry which was already struggling with high production costs caused by high priced input like fertilizers.
Key players in the field are, however, confident that this will change, given the expected rebound.
“We have witnessed good rains that will improve production, coupled with a strong euro and easing inflation in Europe, which will boost our earnings this year,” expressed Okisegere Ojepat, Chief Executive of the Fresh Produce Consortium of Kenya, in April.
CBK data further noted the stagnant nature of cut flower exports, which have grown by 0.31 percent to reach 69,205 metric tonnes in the 6 months under investigation.
Fruits and nuts, on the other hand, demonstrated a 16.78 percent growth in volume, reaching 137,396 tonnes. Meanwhile, vegetables increased by nearly a fifth, reaching 111,715 tonnes.
Kenya exports fresh farm produce to Europe, with the continent being its largest importer, receiving nearly three-quarters of the country’s horticultural produce.
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