Sh68m grant to improve horticulture produce

August 5, 2011
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, NAIROBI, Kenya, Aug 5 – A large number of horticultural produce from East Africa will now have easier access to the international market once the capacity of farmers from the region to meet that market’s stringent sanitary and phyto-sanitary requirements is enhanced.

This follows the release of a Sh68 million ($730,000) grant to the Fresh Produce Exporters Association of Kenya (FPEAK) to help farmers raise their quality and production standards and thus be in compliance with global requirements.

“We like to ensure that the regional (agricultural) practices are up to scratch and that through the tool of standards compliance, enhance the integration of the private sector across the industry,” said  FPEAK Chief Executive Officer Dr Stephen Mbithi.

The funds were provided by Trademark East Africa which reckons that the project will help improve the incomes and livelihoods of the beneficiaries most of whom are small scale farmers.

The inability of many African producers to meet the demanding requirements has been one of the reasons why the continent has been unable to penetrate the global market.

In addition, poor traceability systems results in lack of market confident in regional produce leading to a loss of market share and demand.

Many people believe that the strict conditions are put in place to lock out products from Africa and hence protect the European and American markets from competition. However, the recipient countries justify their action by citing the need to ensure safety for their consumers.

This view has for instance been reinforced by the recent E.coli outbreak in Germany which is believed to have originated from bean sprouts.

The killer bacteria that claimed over 30 lives and left thousands of people across 14 European countries ill saw many farmers banned from supplying vegetables to Europe and led to billions of shillings in losses.

Although no Kenyan farmers were affected, there partners have recognised the benefits of complying with those regulations in a bid to not only capture a bigger share of the global market but also increase the earnings from the sector.

“We would like to see more regionally but also collectively sell more in the international market. Standards are indeed a passport to trade and through this project, we seek to comply with those standards,” Dr Mbithi pointed out.

The horticulture industry has been one of Kenya’s top foreign exchange earners fetching the country an average of $1 billion (Sh90 billion) per annum.

The value of the sector is currently estimated at $ 2 billion (Sh180 billion) largely due to what is believed to be adherence to the industry code of practice that is accepted by supermarket retailers in Europe and the rest of the world.

Although only about five to ten percent of horticultural produce is exported, players reckon that this compliance will assist them in their diversification efforts.

The EU market accounts for about 82 percent of the export business but there have been sustained efforts to venture into other markets such as in Eastern European, Middle East And the Far East and hence diversify the risks.

The diversification campaign has especially been fuelled by the shocks such as global recession and the recent eurozone crisis that the industry has had to grapple with in the last three years.

“Given the trends in the global economics, we feel that it’s a bit dangerous to have 82 percent of everything export to one destination so we want to see much more dollar and yen denominated exports and other currencies as well,” stressed the CEO.

Locally, the industry has to put up with a depreciating shilling that on Friday was hovering around Sh93.10 against the US dollar.

Although, a weak currency would normally presents good tidings for the industry, the rate at which it has plummeted is hurting the exporters as most of their farm inputs are dollar denominated.

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