Economic weakness in Europe and a jump in cargo charges have hit flower firms that were anticipating good returns this Valentine’s season with most of the companies expected to sell roses locally to avoid the exorbitant cost of freight.
Scheduled freighters out of Jomo Kenyatta International Airport are charging $2.80 this season for a kilo of cargo airlifted to Europe, up from $1.80 previously.
On the other hand, airlines that have been issued with a short-time licence to operate flights out of JKIA for Valentine’s season only –normally referred to as ad hoc flights— are charging as high as $3.50 for a kilo of freight.
“Uncertainty caused by high freight charges and the recession in Europe that has cut expenditure on luxuries such as flowers, makes it difficult for our firms to export most of their produce this Valentine’s,” said Kenya Flower Council chairman Richard Fernandes.
According to the International Monetary Fund, nearly half of Europe is grappling with a weak economy, partly because of the ongoing war between Russia and Ukraine that has paralysed economic activities in most of the world’s major economies.
Europe is Kenya’s top buyer of fresh produce with Valentine’s season accounting for 40 percent of the total flower sales annually.
Unlike the previous years when the demand for export volumes surpassed the available capacity, this year freighters say the available cargo for export is just enough to fill the available space.
“The demand for Kenyan roses during Valentine’s is low… and there has been a lack of demand from the retailers in Europe, hence the existing flights will be enough for this period,” said Sanjeev Gadhia, chief executive officer of Astral Aviation, whose airline operates cargo in Africa, Europe and the Middle East.
Mr Fernandes said some flower firms will be forced to dump the flowers locally other than incur the high cost of shipping them out of the country with no certainty on whether they will make some margins.
“It will be difficult for some flower firms to export their commodity when it is not clear whether they will break even,” he said.
