RATIN

Exporters fear loss of EU French beans market

Posted on June, 28, 2017 at 10:13 am


Kenya is at risk of losing market share for French beans exports to the European Union to Morocco and Guatemala due to high cost of production, it has emerged.

The country has traditionally been exporting more French beans and Asian vegetables to the EU market, but the trend is gradually shifting southwards.

Newly-appointed Fresh Produce Exporters Association of Kenya chief executive Hosea Machuki said that despite the country's beans remain the most preferred in the EU market, Morroco and Guatemala are increasingly growing their market share.

He attributed this to proximity and efficiency in production by both countries, while Kenya is grappling with high production and freight cost. The Kenyan beans are also considered overpriced despite superior quality. Morocco produces bobby beans which are considered lower in value than Kenya's which are largely of premium quality.

"When our French beans arrive in the EU market, they are normally overpriced due to high cost of production at farm level and freight cost over and above high taxation,” Machuki said.

A kilogramme of french beans sells for Sh25 to Sh30 locally, with shipping cost to the EU market at about Sh200, according to FPEAK. In Guatemala, Machuki said the shipping cost is half at about Sh100 per kilo, which translates to Sh180 from farm to the EU market.

A four-kilogramme carton of French beans is priced at between eight and 10 euros (Sh925 and Sh1,156), translating to Sh231.25 and Sh289 per kilo.

“If you deduct the cost of production and freight charges from the price per kilo, the farmer is left with something between Sh50 and 110,” Machuki said. “The cost of production in Morocco ranges from Sh10 to Sh15 per kilo and less than Sh15 in Guatemala.”

He further pointed out that the ban from January 2013 to July 2015 on French beans prompted the EU to source for new markets, a development which benefited countries like Morocco and Guatemala.

The ban was slapped on Kenya for exporting beans which contained illegal chemical. The leaves allegedly had high levels of Maximum Residuals Limits to the EU, contrary to trading requirements.

Data from Horticulture Crops Directorate, which is under the Agriculture, Fisheries and Food Authority, shows Kenya exported an estimated 349 million kilogrammes of French beans in January, 419 million tonnes in February and 354 million tonnes in March this year.

“Morocco is also very aggressive in marketing their fresh produce while Kenya is not. We need to address the export number, while still observing the highest standards which have made our French beans become more preferred in the EU market. Guetamala, on the other hand, have an upper hand in efficiency,” Machuki said.

Other challenges, he said, include high taxation and bureaucracies from farm to the market which make the export process long and cumbersome.

“When you put so many taxation and have many bodies to certify that the produce are good for the export market, yet Kenya already has stringent rules and regulations on quality and standard in the horticulture industry, this sometimes works against us,” he said.

Source: The Star