“During last year's peak winter season, we shipped about 45 tons of herbs per month to Europe,” said Ariff Shamji, managing director of AAA Growers. That's about double what they average during the rest of the year. AAA also exports vegetables, and it's expanding into some fruit items, like raspberries.
Combined, they export about 800 tons of fresh produce every month including fresh cut flowers. All of it is transported via air. The top export destinations are in Europe, with the United Kingdom taking a significant percentage of shipments.
The biggest herbs from Kenya are chives and basil, however, AAA doesn't rely on these two herbs, but instead has a bigger market share based on a wider range of herbs. Their range includes tarragon, mint and sage, to name a few, which helps mitigate risk when it comes to the overall range being exported out of Kenya.
“The two biggest herbs we ship are chives and basil, and other big commodities are parsley, mint and coriander,” said Shamji. “We also ship a lot of coriander and parsley to the United Kingdom.” Demand in Europe has been growing steadily over the years, even though the packaging requirements in the European Union are a significant hurdle shippers have to deal with. Most herb exports out of Kenya take place from November through March, and most of those go to Europe, though there has been strong demand from Eastern Europe lately.
“The problem with Eastern Europe is that the market there isn't very stable because of the currency crisis of the ruble,” explained Shamji. “There are inquiries for large volumes, but demand is erratic. Price-wise, the market there is about the same or a little better than in Europe, but it's an unstable market.” Packaging standards are less uniform and less demanding there, and while that eliminates some of the red tape that makes it difficult to ship to Europe, Shamji noted that, due to its limitations, Eastern Europe is best used as a spot market, not as part of a long-term export plan.
The partnerships that Kenyan growers have made with Israeli companies have been mutually beneficial, according to Shamji, because they have matched a robust flower and vegetable infrastructure in Kenya with Israeli companies that specialize in herbs. Israeli companies provide marketing expertise and connections with European importers. Kenya, in turn, offers lower production costs. While Ethiopia can offer some of the same advantages to Israeli companies, the administrative environment is not as easy to navigate as it is in Kenya.
Falling oil prices could lead to lower herb prices if freight companies decide to lower what they charge based on lower fuel costs. If that's the case, Shamji said they'll pass on some of those savings to consumers, but barring that, the market should remain steady through peak winter months.
“I'm fairly sure that prices won't go up,” said Shamji. “They have the potential to go down, but unless freight costs change, the market will be static.”
For more information: Ariff Shamji
AAA Growers Ltd
Tel: +254-20-4453970/1/2/3/4
Fax: +254-20-4453975
email:ariff@aaagrowers.co.ke
AAA Growers Ltd
Tel: +254-20-4453970/1/2/3/4
Fax: +254-20-4453975
email:ariff@aaagrowers.co.ke