By BUSINESS DAILY

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Kenya’s earnings from horticultural exports for the half-year period through June recovered from a double-digit fall in the prior year amid a strengthening euro and moderating inflationary pressures, official data shows.

Sales from horticultural exports amounted to Ksh69.48 billion ($476.1 million) in the review period, according to data collated by the Central Bank of Kenya (CBK), a modest 7.16 percent rise from Ksh64.84 billion ($444.3 million) in a similar period last year.

The increased earnings came at a time when the euro appreciated 16.54 percent against the shilling between January and June, boosting revenue for Kenyan producers who largely earn in the eurozone currency.

About 70 percent of Kenya’s horticulture exports are paid in euros, according to industry estimates, while nearly a fifth of the consignments are paid in the British pound.

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The data shows the earnings from cut flower exports grew 9.02 percent in the review period to Ksh33.53 billion ($229.7 million), while inflows from fruits and nuts were 9.42 percent more than last year.

Revenue from vegetables was, however, flat at Ksh14.25 billion ($97.6 million) compared with Ksh14.26 billion ($97.7 million) the year before.

The increased inflows came at a time when inflation in the eurozone— a group of 19 countries that use the euro as a common currency—moderated after climbing to decades-high levels last year.

Inflation in Europe and other advanced economies soared in 2022 on the back of Russia’s brutal war in Ukraine which further disrupted supply chains that were yet to recover from pandemic shocks.

Data from the European Statistical Office (Eurostat) shows inflation in the eurozone averaged 7.08 percent in the January-June 2023 period, largely unchanged from 7.10 percent in the corresponding period.

The average annual price growth was, nonetheless, far away at 1.43 percent levels in the first half period of 2021.

Last year’s increased inflationary pressures, largely from energy, had seen households cut spending on non-essential goods like cut flowers, hitting local producers hard at a time they were also battling elevated costs of inputs such as fertiliser.

This is expected to change this year, with players forecasting a rebound.

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“We have witnessed good rains that will improve production, coupled with a strong euro and easing inflation in Europe which will boost our earnings this year,” Okisegere Ojepat, chief executive at Fresh Produce Consortium of Kenya, said in April.

The CBK data shows exports of cut flowers were largely flat, growing 0.31 percent to 69,205 metric tonnes in the six months under review.

The volume of fruits and nuts sold outgrew 16.78 percent to 137,396 tonnes, while vegetables increased by nearly a fifth to 111,715 tonnes.

Europe is the largest market for Kenya’s fresh farm produce, according to conservative estimates, buying nearly three-quarters of the country’s horticultural exports.