Horticulture earnings defy strong shilling to grow by 15.2 percent

Factory attendants sort out and package snow peas at the Horticultural crop development authority processing zone.

Photo credit: File | Nation Media Group

Earnings from fresh fruits, vegetables, nuts, and cut flowers grew by 15.2 percent between January and April to defy a strong shilling boosted by higher export volumes.

This comes as Kenya seeks duty-free access to its exports, including fresh produce, to the European Union (EU) and the US through fresh trade deals in addition to recent forays into the vast Asian market, particularly China and India.

Data from the Central Bank of Kenya (CBK) shows horticulture earnings grew to $363 million (Sh46.9 billion) over the four months, marking a significant rise from $315 million (Sh40.7 billion) earned during the same period last year.

“Export earnings from horticulture have increased with the higher export quantities,” said the CBK.

The higher earnings defied a rapid appreciation of the Kenyan shilling against the US dollar, with the local currency strengthening from an average low of Sh159.7 in January to an average of Sh131.4 in April.

Fresh produce exporters are paid in US dollars, which means that they earn more in Kenyan shillings when the local currency depreciates and less when the shilling strengthens.

The increase in earnings came on the back of significant growth in export volumes, which jumped 57 percent to 246,000 tonnes up from 189,000 tonnes in the same period last year.

Vegetables were the best-performing horticultural crop as earnings grew 38 percent to $83 million (Sh10.7 billion) supported by a 73 percent jump in export volumes.

Earnings from fruits and nuts grew by 22 percent to $92 million (Sh11.9 billion) driven by an increase in export volumes to 83,000 tonnes compared to 73,000 tonnes last year.

On the other hand, a 2 percent decline in export volumes of cut flowers failed to dent earnings from the crop, which grew by 5 percent to hit $189 million (Sh24.4 billion), signalling higher market prices.

Horticulture is one of the leading export earners for Kenya. Other foreign exchange earners include tea, coffee, and tourism.

The Netherlands is the largest market for Kenya’s horticultural exports, particularly cut flowers, followed by the UK, France, the United Arab Emirates (UAE), and Germany.

China, India, and Kazakhstan are also emerging as major destinations for Kenya’s fresh produce, particularly avocados.

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