Kenya to Resume European Mango Exports, but Logistics Issues May Pose a Threat
Long-lived export ban on Kenyan mangoes
In 2014, the Kenyan authorities put a self-imposed ban on export of mangoes to the EU due to a number of consignments from Kenya not clearing through the EU customs. Kenya at that point suffered from a lack of hydrothermal treatments for fruit fly (Tephritidae) removal and therefore failed to meet the phytosanitary requirements. As a precautionary measure, Kenyan authorities imposed the export ban themselves before being quarantined by export markets. The missing hydrothermal treatments and other effective pest management technologies led to losses of around 40% in post-harvest quantity, low quality fruit crop, and consequently loss of market value. In 2020, Kenya’s Horticultural Crops Directorate estimated that fruit fly damage costs amounted to USD 472 million per year across all fruit produce.
During the ban, Kenya has worked on satisfying documentation requirements, spreading the use of pheromone traps, building and scaling facilities for hydrothermal treatments as well as creating fruit fly free zones. Additionally, fruit processing plants, such as the Makueni Fruit Processing Plant, have been established and have granted some succor for farmers, as the purée and juice production can accept a lower fruit quality than fresh mango purchasers.
The ban on exports seemingly had little effect on production volumes as 763,255 metric tonnes of mangoes were grown in Kenya in 2015. In 2020, the Kenya Plant Health Inspectorate Service reported that the production totalled 779,147 metric tonnes. This may be explained by the fact that Kenya in 2015 exported just 2% of total production volume. By 2020 the percentage has slightly increased and now constitutes 3%. During the export ban period, Kenya has exported mainly to the Middle Eastern countries of UAE, Oman and Saudi Arabia in addition to the border trade with Uganda. Export volumes to Uganda have skyrocketed from 283 metric tonnes in 2015 to 14,942 metric tonnes in 2020 (+5,180%) for an export value as low as USD 172 per metric tonnes in 2020.
Boost in Kenyan Mango Exports on the Way
In September 2021, Kenya sent a trial load of 5 metric tonnes mangoes to Italy, in the hopes of the invested hydrothermal treatments and quality control documentation meeting the EU standards. The inspection resulted in a clean bill and Kenya was inquired about the possibility for further shipments. Apart from Italy, Kenya has set their eyes on Germany and the United Kingdom as new possible export markets and in October 2021, a delegation from Kenya visited the two countries to explore the opportunities.
This time, Kenya will be considering to focus on the less-fibrous varieties such as Keitt or Kent, that are preferred by consumers in Northwestern Europe in particular. Keitt and Kent also have a longer shelf life of up to 35 days, which is needed as transport to Europe can take upwards of 28 days. In comparison, the most common variety in Kenya, the Apple mango, has a shorter shelf life of 10-14 days that even complicates sea freight to the Middle East, which typically takes around 10 days.
Kenya Struggles With Sea Logistics
A chance for a return to the European market may be good news for Kenyan producers, as it is a relatively lucrative and profitable alternative in comparison to the border trade with Uganda or the Middle Eastern markets on which Kenya has faced strong competition from Egypt. Kenyan stakeholders anticipate that their possible earnings on the European market are 20% higher than in the Middle East.
Despite the developments of the Kenyan mango industry, it is still lagging behind other players in the EU market. One major factor contributing to Kenya’s lag is the limitations of Kenya’s logistics industry.
Kenya’s sea freight industry is not accustomed to the export of fresh fruits, whereas the comparatively costly air freight is well-developed. A 2021 report by Hortiwise points towards a lack of multiple well-functioning harbors, poor supply chain coordination, lack of dedicated procedures for perishables and insufficient coordination between authorities to facilitate trade, as some of the reasons why sea freight is underdeveloped in Kenya. Industry stakeholders see great potential in the use of sea freight and suggest a target of 50% of current air freight to be transported by sea in 2030, which would reduce the costs greatly.
Currently, Kenya’s freight costs are far higher than their competitors, as more than 90% of Kenyan fruits are exported by air. In June 2021, a Kenyan exporter informed Business Daily Africa, that Kenya’s reliance on air freight constitutes a comparative disadvantage, as the air freight costs USD 1 per kg. exported to the Middle East, whereas Egypt using sea freight spends USD 30 cents. As for the European market, the exporter estimated that the price per kg. would be USD 71 cents for sea freight and between USD 1-2 for air freight.
In addition to having lower freight costs, Egypt has generally been able to supply the Middle Eastern markets with significantly cheaper products, which has been a major challenge for Kenyan exporters.
Source: ITC Trade Map, 2019 data
On the EU market, Kenya will face direct competition from the major mango exporters namely, Peru and Brazil. As a point of reference, the 2020 export prices of Peruvian and Brazilian mangoes in the Netherlands, the largest importer of mangoes in the EU, was USD 1,080 and 1,172 per metric tonnes respectively.
Source: ITC Trade Map, 2020 data
Notes
Some data in this analysis is based on HS CODE 080450, that besides mangoes include guava and mangosteen. Guava and mangosteen are niche products, so mango will be the dominant product in the data.
EU = EU(27), excluding UK.
Sources
Tridge Analysis - Mangoes from Kenya: Production, Varieties, and Competition
ITCTrade Map - import/export data
A study on sea freight opportunities to accelerate Kenya’s agricultural exports
Horticulture Study Phase 1: Mapping of production of fruits and Vegetables in Kenya
Exports hope as mangoes pass Italian safety test
Mango exports slated to resume next year
Kenya to resume mangoes exports to the European market
Facebook post by Kenya Plant Health Inspectorate Service - Kephis
Kenya Determined to Revitalize Fruits Banned for Export
Kenya Mangos – An Overview of Current State of Mango Farming in Kenya
Kenya regains lucrative EU mango market as Italy shows appetite for more
KENYA: Mango boom sees region smiling its way to the bank