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Kenya farmers face uncertain future as Covid-19 cuts exports to EU

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Hobbled by the triple impact of flooding, locust infestations and now the coronavirus pandemic, Kenya’s horticulture industry is in crisis after global lockdown measures curtailed exports to Europe and disrupted internal African trade.

Shipments of flowers, vegetables, herbs and fruits to the European Union, which accounts for more than 80 per cent of horticulture exports from Kenya, all but ceased in March after European capitals, roiled by the spread of Covid-19, locked down and Kenya suspended most international flights. By April, Kenya’s horticulture industry was losing about $3.5m a day, according to the Fresh Produce Exporters Association of Kenya.

As European countries have begun to ease restrictions, some demand has returned and losses have reduced to about $1m a day, but the outlook remains bleak. “Kenyan farms have drastically reduced export volumes to 50 per cent, with a sizeable number suspending exports altogether,” said Hosea Machuki, chief executive officer of FPEAK. “If the current situation does not improve soon, companies are facing downsizing or closure . . . which will result in increased poverty, insecurity and hunger.”

Smallholder farms make up 80 per cent of Kenya’s agricultural sector, which contributes 26 per cent of the country’s GDP. As part of president Uhuru Kenyatta’s Vision 2030 development plan, the government had supported the creation of small and medium-sized farming businesses. Many of those companies, like the herb manufacturer Jambofresh, had just begun to profit from a European clientele before coronavirus struck. We are at the point where we are considering to close down because we cannot maintain the farm given the costs involved Silas Mutuma, managing director of herb producer, Jambofresh Jambofresh, which produces around 30 tonnes of basil, mint, rosemary and thyme a month, began exporting to the EU in 2017, according to Silas Mutuma, the managing director.

Today practically all of the firm’s herbs end up on European supermarket shelves. The company’s largest buyer was based in Milan, Italy, which saw some of the highest coronavirus casualties in the early weeks of the pandemic. Jambofresh’s sales immediately collapsed, Mr Mutuma said, forcing the company, which is currently shipping just 10 per cent of its usual exports, to dump 60 tonnes of produce in the last three months. “We are at the point where we are considering to close down because we cannot maintain the farm given the costs involved,” he said.

“It’s very sad when you see the product being destroyed. Often I get somebody else to throw it away because I can even shed tears.” Coronavirus: how to stop a second wave For now, the biggest obstacle for the horticulture sector remains the lack of airfreight. Demand for fresh produce in the EU is picking up as restrictions lift, but commercial passenger flights, which carry the bulk of Kenya’s fresh exports, have been grounded in Kenya since 23 March. “The current available cargo is 1,500 tonnes weekly, while the demand is 3,500 tonnes,” said Martijn Boelen, trade adviser for the EU in Kenya. Furthermore, the price of freight has doubled from $1.80 per kilogramme to up to $4 per kilogramme in some cases, he said.

“This means that even if capacity is available, it might be out of reach for producers.” But it is not just intercontinental air traffic that has been affected. At Namanga, on Kenya’s border with Tanzania, one hundred drivers stood in the sun, waiting to be called for a coronavirus test by health ministry officials. A vendor wearing a protective face mask cuts herbs and leaves for sale on her vegetable stall at Toi market in Nairobi in May © Patrick Meinhardt/Bloomberg The drivers wait up to five days to receive the test results back from Nairobi, 162km to the north, meaning only about 50 trucks are being cleared to enter Kenya a day, down from 250 a day before the pandemic. Those carrying perishable goods, such as onions and oranges, said much of their cargo rots while they wait.

The result was clear on supermarket shelves in the capital Nairobi, where the price of fresh produce has soared because of shortages, in some cases by up to 90 per cent. The unprecedented disruption is forcing some producers to reflect on the structure of the sector. Mr Mutuma of Jambofresh said destroying tonnes of French beans — for which there is no local demand — while the country suffered from food shortages, meant Kenya needed to rethink how and what it produced. Recommended Kenya Poaching fears rise after coronavirus empties Kenya’s national parks “Some of the things we import like onions we could also produce more of, but we need to encourage local producers by subsidising inputs,” he said. Cold chain infrastructure needed to transport fresh produce in temperature-controlled environments is still limited and expensive. For exports, a bean picked in Kenya is usually in a European supermarket in 72 hours, and the EU consumer can afford to cover the cost of chilled transportation. But the price would generally be too high for sale domestically.

One solution would be to transform more domestic fresh produce into dry goods, Mr Mutuma said. In the short-term, associations like FPEAK have appealed to the government to inject life into the sector by encouraging more airlines to fly cargo out of Nairobi through tax incentives, subsidies on jet fuel and waiving landing costs. The EU is setting up a funding programme, in partnership with the European Investment Bank, to provide SME’s with easier access to finance. If it does not work, the entire horticulture export sector could collapse, FPEAK’s Mr Machuki warned. “There is a real risk of loss of foreign earnings for the country, loss of domestic revenues paid by growers and exporters, and ultimately loss of 350,000 direct jobs.”

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