For Kenya to reap the maximum benefits of the US market, flowers need to be flown to Miami directly, the main getaway of US flower market
By BOB KOIGI
August 23,2018, Nairobi. As Kenya readies for the inaugural direct flight to US in October this year, key sectors including horticulture have been identified as major beneficiaries of this historic development. But insiders are not as enthusiastic and insist that preference for passenger flights and choice of airport do not favour them.
National carrier Kenya Airways is keen on growing passenger numbers in the inaugural flights and hasn’t made concrete commitment to introduce cargo services, which industry players say has to be pursued if the country Kenya is to capture the US market.
“At the moment the business model of Kenya Airways in as far as accessing the US is concerned is largely on passenger flights. Of course we are keen and are in talks with them to see a provision for freight services because Kenya flowers have a ready market in US due to our range of flowers grown in different altitudes that our competitors in that market like South Americans don’t have,” said Clement Tulezi the CEO of Kenya Flower Council during the 2018 International Flower Trade Expo, IFTEX.
Kenya’s share of the US market is less than four percent due to among others high costs, long routes and tedious handling processes that eat into exporters’ revenues. This market has always given the Kenyan flowers a thumbs up for quality if feedback from buyers in various expos are anything to go by. Traditionally, flowers destined for US from Kenya pass through Amsterdam or South Africa an expensive affair with cargo flights charging Sh400, about $4, for every kilogramme for transit stopover and other attendant costs.
“The US is a great market but it is not one we are keen on pursuing at the moment because of the costs involved and again we would need to invest in market research. Our business model is hinged on direct sales so we would need to really work on solidifying that market and understanding the dynamics. We are cognizant of the stiff competition from the South Americas,” said Aldric Spindler the Executive Director at Redland Roses Limited.
The second dilemma for Kenya flowers is that even if Kenya Airways were to accommodate the perishables, flights will terminate at the John F. Kennedy International Airport in New York with experts insisting that for Kenya to reap the maximum benefits of the US market, flowers need to be flown to Miami directly, the main getaway of US flower market.
It is a distance of 1700 kilometers which means it would take two hours 50 minutes to fly from JF Kennedy Airport or 18 hours to truck the flowers to Miami. “Miami is the hub of flower business in United States. Over 85 per cent of all flowers that are distributed in the US arrive through its port district. Think of it as the The Aalsmeer Flower Auction in Netherlands.
There is no doubt that Kenyan flowers are world class in quality. But if Kenya really wants to capture the US market, it really needs to think about flying its flowers directly to Miami. Using any other route will still be as expensive as has traditionally been,” William Armellini the Editor and President of Flowers and Cents, a US based floriculture publication told HortiNews during the 2018 IFTEX. Mr. Armellini who enjoys a huge following among respected flower buyers in America and its neighbours had led a delegation of floriculture companies at the flower expo to scout for potential deals. “They are quite impressed at the level of quality coming from growers and some of them have even placed orders,” he said.
Miami has been christened the Ellis Island of flowers. An approximated 32,000 boxes of flowers are delivered at the Miami International Airport every day, representing 40 per cent of all cargo handled at the station.
“JF Kennedy Airport or even Chicago do not have the dedicated distribution network that Miami has and that is why everyone takes their flowers to Miami directly. Once the flowers land at it is easy to distribute them to wholesalers and supermarkets. But Kenya also needs to be aware of the South American countries that have established a strong foothold and have a huge network in the area,” Armellini added.
The two South American countries, Colombia and Ecuador take the lion share of flower imported to America with over 65 per cent of all flowers distributed in US coming from Colombia while Ecuador takes up approximately 25 per cent of the market.
Last year for example, Colombia shipped over 4 billion flowers to America alone.
“There are very prime markets for example North America. What we envision doing is complementing the market because our flowers are quite different from those of South Americas so there shouldn’t be competition per se,” said Tulezi.
Armellini agrees: “Kenya has a niche in intermediate roses which have the perfect head size, right length and have a longer shelf life which makes them ideal for the bouquet business mostly preferred by supermarkets. This is a key advantage that Kenya has over the South Americans.”
With an annual retail sale of about $31.3 billion and more than 15,000 retail florists dependent on growers, wholesalers and exporters for their stocks, the US flower market is a goldmine. Roses are the most popular flowers year round accounting for up to 35 per cent of all flowers sold. For example, there are about 85.4 million mothers with Mother’s Day remaining of the most celebrated days in the country. About 69 per cent of all the day’s gifts are flowers. Out of the average $61.56 that a typical American spends on Mother’s day gifts, $42.48 goes into buying flowers.
“It is such a huge market. The only way is to get these flowers to the consumers cheaply and on time. Ethiopia has realized this and that is why its national carrier is opening up so many cargo routes across US. This is the strategy Kenya needs to focus on,”Aemellini said.
hortinews@hortinews.co.ke
