Tuesday September 2 2014

Flower exporters urged on new markets

People harvest flowers. Flower exporters have

People harvest flowers. Flower exporters have been encouraged to look beyond the traditional flower markets. 

By Dorothy Nakaweesi

Uganda’s flower exporters have been challenged to start thinking of diversifying to new markets rather than wholly depending wholly on traditional buyers characterised by so many restrictions.
Already according to information from Uganda Export Promotion Board (UEPB), there is steady demand for the country’s flowers in South Africa and Kenya.
In an interview with Prosper magazine, trade promotion officer Mr Moses Mabala said: “EU is still an important market for our flower exports and specifically, Netherlands, which boasts of 80 percent of Uganda’s export market share. We, however, see that this trend is slowly shifting to regional/African markets.”
He added that they have been noticing a fast growing market trend for Ugandan flowers in South Africa and Kenya, thus opening room for exporters to exploit.
According to UEPB’s export records in the year ending 2013, Ugandan flowers exported to South Africa earned the country $1.3 million (Shs3.3 billion) making it the country’s fourth market destination.
Mr Mabala attributes this trend to the increasing demand and easy logistical issues which gives the exporters more frequent flights which means they spend little money unlike to the European market.
The other export destinations for Ugandan flowers were Netherlands worth $48.4 million (Shs125.8 billion). Flowers exported to the United Kingdom were worth $2 million (Shs5.2 billion).
The other market destinations for Uganda’s flowers are Germany which brought in $1.6 million (Shs4.1 billion) worth of revenue and Italy with flower export earnings worth $835,000 (Shs2.1 billion) while exports to Kenya were worth $143,000 (Shs371 million) respectively.
Other countries with export potential for Uganda are Russia and Japan.

Country performance
In 2013, Uganda’s exports of flowers to the world reached $56.4 million (Shs146.6 billion). This indicated a 7 per cent growth between 2012 to 2013.
Quantities exported also posted a 3.8 percent growth from 6,400 tons in 2012 to 6,648 tons in 2013.
Uganda’s flower exports represent 0.26 percent of world exports for this product and the country is ranked the 33rd biggest exporter in the world.
Latest statistics for 2014 reveal that flower exports stood at $16.1 million (Shs41.8 billion) in the first quarter of 2014.
In Africa, Uganda is the fifth largest exporter of flowers to the world after Kenya, Ethiopia, Egypt and South Africa respectively.

Industrial demands
Industrial players challenge government to recognise and support the development of the flower industry as a long-term policy.
Industrial players say although they are currently benefiting from the 10-year tax holiday that has allowed expansion of production areas by several farms. However the fiscal incentives alone are not enough to attract new investors or encourage existing investors to expand.
Ms Julie Musoke Uganda Flower Exporters Association (Ufea) said: “Unless there is deliberate government intervention with incentives that attract investors and quick expansion the industry’s growth is likely to stagnate.”
She adds that some of the interventions government needs to put in place for the development of this industry apart from the 10-year tax holiday, the industry needs subsidised air freight, land leased at nominal rates with green house infrastructure, 70 percent investment loans at 6 percent interest rate.

Flower Numbers

Growth of Uganda’s flower exports from 2012 to 2013

Money earned from Ugandan flowers that were exported to the UK in 2013