Horticulture earnings hit Sh153 billion last year making it the third foreign exchange earner after diaspora remittances (Sh272 billion) and tourism (Sh157 billion).
The earnings in the review period grew by 33 per cent from Sh115 billion in the previous year on account of high demand and good international prices.
Flowers made the bulk of the earnings, bringing in Sh113 billion, with vegetables at Sh27 billion and fruits raking in Sh12 billion.
The industry defied challenges resulting from delays in supply of fertiliser to make the impressive performance.
Kenya Flower Council (KFC) chief executive Clement Tulezi said the performance shows the country’s potential.
“The industry overcame many challenges such as high energy costs and trade and phytosanitary restrictions in several potential markets,” he said.
He said the challenges the government should address include double taxation and the high cost of doing business.
Trade Principal Secretary Chris Kiptoo said the government was addressing the challenges. "From the results that we have just seen it is evident that the horticulture industry is key to our economy and we need to give it all the required support," he said.
Dr Kiptoo said the government was working toward expanding the export market for horticultural products besides European markets which account for 40 per cent of exports.
“The government is exploring new markets like China to complement the traditional European market.
“The US market is also key for us following commissioning of direct flights between Kenya and the US,” he said.
The sector was hit hard by acute shortage of fertiliser resulting from the stringent and lengthy clearance process by the Kenya Bureau of Standards at the port of entry.
The sector was also affected by imposition of 16 per cent VAT on pest control products.