More than 1,000 workers will lose their jobs by Christmas as multinational firm Finlays moves on with plans to close down two of its flower farms.
Finlays has blamed the closure, coming a year earlier than initially planned, on low international prices of cut flower at the European market, where Kenya sells over 60 percent of its horticulture produce.
Finlays Flowers General Manager Stephen Scott said in a letter last week that the directors had decided to close operations at two of its flower farms in Chemirei and Tarakwet, including those seconded to Murara plants.
“It is no secret that in the last 18 months flower industry has been facing severe challenges. Due to an oversupply in the European market and decreasing demand, the price of roses has remained low,” said Mr Scott in the letter.
“As a result of this and other challenges, including a weakening exchange rate, extreme weather conditions and high labour cost, the director of James Finlay (Kenya) Limited have made the decision to close Chemirei and Tarakwet farms earlier than it had initially been communicated,” he added.
The company had in April last year announced that it would draw the curtains on the two farms in December 2020. At the time, the farms had 1,700 employees.
The firm says all employees, including those who had been seconded to another farm will be redundant and they will be paid their final dues in full.
Earnings from horticulture dropped by Sh6 billion in eight months to August, signalling a bad year for flower and vegetable farmers in 2019.
Statistics from the Kenya National Bureau of Statistics (KNBS) show that the earnings in the review period dropped from Sh103 billion in corresponding period last year to Sh97 billion this August.
The move implies that government will also earn less foreign exchange from the produce owing to depressed income.
Cut-flower export still remains the largest earner of horticulture, contributing over 70 per cent of the total fresh produce annual earnings.