Logistics Constraints Affecting Fresh Produce Export in Kenya.
Kenya is a significant player in the global fresh produce market. The country’s tropical climate supports a diverse range of produce, which is in high demand in European, Middle Eastern, and Asian markets. Fresh produce exports constitute about 20% of Kenya’s total export revenue, with products like flowers, avocados, and green beans leading the charge. However, the perishable nature of these goods makes logistics efficiency vital to maintaining product quality during transportation.
Kenya’s fresh produce export sector, vital to its economy, is currently grappling with significant logistical challenges that hinder its ability to meet international demand. Despite a robust market for Kenyan horticultural products, particularly in Europe, exporters are facing a myriad of obstacles that threaten their competitiveness and profitability.
Current State of Fresh Produce Exports
The horticulture sub-sector is crucial for Kenya, contributing approximately 13% to the nation’s GDP and employing around 50% of the agricultural workforce. In 2023, the sector generated Sh157 billion ($1.21 billion) in export earnings, yet it is now operating at only about 30% of its capacity due to logistical issues. The ongoing challenges have been exacerbated by the withdrawal of several international airlines from freight services at Jomo Kenyatta International Airport (JKIA), which has led to a significant reduction in air cargo capacity [3].
Key Logistics Challenges
1. Air Freight Limitations:
– The cost of air freight has surged, with prices now ranging from $3.5 to $4 per kilogram, compared to $2.3 previously [3]. This increase has made it economically unfeasible for many exporters to send their products abroad.
– The reduction in available cargo space is critical; airlines are prioritizing more lucrative routes and cargo types, leaving fresh produce exporters struggling to find capacity.
2. Road Transport Issues:
– Poor road infrastructure and lengthy export processes complicate the transportation of goods from farms to airports and ports. Roadblocks and delays can lead to spoilage, further diminishing the quality and marketability of fresh produce [1].
– The curfew restrictions during the pandemic have also hampered night operations for loading and transporting goods, significantly slowing down the entire logistics chain [1].
3. Regulatory Hurdles:
– The export process is marred by excessive regulations, including multiple licensing requirements and delayed inspections by government agencies, which prolongs delivery times and increases costs.
– Stakeholders have called for a reduction in bureaucratic red tape to streamline operations and make compliance less burdensome.
4. Inadequate Cold Storage:
– There is a lack of sufficient cold storage facilities and consolidation centers necessary for maintaining the quality of perishable goods during transport [2]. Without these facilities, the risk of spoilage increases significantly.
Impact on Exporters
These logistical constraints have led to substantial financial losses for exporters. Many are unable to fulfill orders due to reduced capacity and increased costs, resulting in lost markets and diminished shelf life for their products. For instance, exporters like Kandia Fresh Produce Suppliers have seen their weekly exports plummet from 40 tonnes pre-pandemic to just 500 kg currently due to these challenges [1].
Potential Solutions
To mitigate these issues, stakeholders are advocating for several measures:
– Government Support: There is a pressing need for government intervention to harmonize regulations and reduce export costs. This includes addressing road transport inefficiencies and enhancing cold chain logistics [2] [3].
– Investment in Infrastructure: Improving road networks and expanding cold storage facilities will be crucial in ensuring that fresh produce can be transported efficiently without compromising quality [2].
– Exploration of Sea Freight: While air freight remains the preferred method for perishable goods due to speed, there is growing interest in developing sea freight options as an alternative. This could help reduce costs and environmental impact while providing additional capacity during peak seasons.
Conclusion
The logistics constraints affecting Kenya’s fresh produce export sector present significant challenges that require urgent attention from both government and industry stakeholders. With companies like GlobeFlight stepping in to provide tailored logistics solutions, there is potential for improvement in this critical sector. By addressing these issues through improved infrastructure, streamlined regulations, and potential shifts towards sea freight, Kenya can enhance its competitiveness in the global market and ensure that its valuable horticultural products continue to thrive.