FROM MAGAZINE: Collaboration essential to air logistics of flowers
Flowers can’t speak for themselves for being neglected. This is where every stakeholder in the air cargo supply chain, including the shipper, come in picture to ensure they are treated with tender care throughout the entire cold chain. Stakeholders must focus on collaboration to ensure smooth and efficient ride for flowers.
In recent times, all the carriers are focusing on a very important product vertical that accounts for a major share of air cargo trade. The commodity, being time and temperature sensitive, requires on time delivery and constant temperature throughout the entire air cargo value chain. It needs to be delivered fresh to the world without its essence being lost.
Grown in two key African regions, Kenya and Ethiopia, flowers have a long journey from the continent to the rest of the world. Kenya holds 7 percent of the global market share today. 35 percent of all sales of cut flowers in the European Union originate from this African country. Due to its high altitude, favourable climate and overall geographical location, Kenya offers perfect growing conditions for roses. Most of the roses (known as “Rhodas”) are red roses with stems averaging 30 to 50 centimetres in length.
“On the whole, the flower industry is crucial to air cargo. From Africa region Kenya and Ethiopia are amongst the leading flower exporting countries from a global perspective,” said Ken Mbogo, regional director Africa, Saudia Cargo. Saudia Cargo is a major airline in these markets with a significant capacity share.
Be it any occasion, such as Valentine’s Day, Women’s Day or any other special occasion, flowers is one of the commodity traded in large volumes. Ahead of these occasions, flowers keep the air cargo industry busy. Luxembourg based all cargo carrier Cargolux was busy, once again this year, as Africa’s flower growers and shippers called on the airline’s services and expertise to bring their goods to European consumers. Throughout each year, Cargolux carries more than 20,000 tonnes of flowers from African markets which translates to around four million flowers per flight. This year, the airline experienced such strong demand that it operates a large amount of extra flights in addition to its seven weekly scheduled services.
In the week running up to Valentine’s this year, Emirates SkyCargo operated four freighters over and above the daily scheduled freighter service from Nairobi bringing close to an additional 350 tonnes of flowers into Amsterdam. Additional capacity was also deployed to supplement the thrice weekly freighter service between Quito in Ecuador and Amsterdam in order to cater to the demand around Valentine’s Day.
Over a five-week period (February/March), around 5,000 tonnes of flowers originating from leading production and export countries like Kenya, Ecuador and Colombia were flown to Europe, where Air France KLM Martinair Cargo has captured the biggest share of the market.
Tonnes of Valentine’s Day roses arrived at UK’s major gateway Heathrow this peak flower season. The vast majority (88 percent) of fresh cut flowers purchased in the UK actually hail from countries along the equator, where they can flower year-round. In 2015, Kenyan roses accounted for 60 percent of rose imports at Heathrow.
Concerns to be addressed to bring change
To avoid wilted flowers and disappointed consumers, there are various concerns that need to be addressed. Some of the concerns were widely discussed at the recently held ‘Air Shippers’ Forum – Flowers & Perishables’ on the first day of the three day Air Cargo Africa event held in Johannesburg last month.
Shippers and other stakeholders involved in the supply chain came together to discuss the theme of the forum “Perishables by air-delivering fresh”. Right from the beginning of the value chain, there are various areas of frustration.
Speaking at the forum, David Beecham, senior manager, Cargo Products, Qatar Airways Cargo, cited one of the major areas of frustration. One of the major concerns is that the shipper should actually present the cargo to us at the right temperature in the beginning. He said, “Because at the end of the day, if the product isn’t at the right temperature right at the beginning of the chain, it will never be at the right temperature throughout the chain.”
Representing major flower grower body and presenting shippers’ point of view, Jane Ngige, chief executive officer, Kenya Flower Council, said, “My specific concerns would be the kind of policy guidelines that we have at both in the private sector and government level. I think the government should be not allowed to be marginalised by the very proactive private sector. My second concern would be how can we deal with the ever rising costs of production at all levels of the industry throughout the value chain. And finally the sustainability of the industry in terms of the environment within which we grow but also in terms of the labour force and the perception of the industry globally.”
Dirk Hanekom, CEO, Agri All Africa, believes that the African continent holds lot of opportunities if the challenges are dealt with properly. He said, “There is an opportunity, we just not managing to put this all value chain together the way we should.”
Stanley Winterbach, managing director, Agri All Africa Nigeria, said, “We’ve got the land, the rain, the sunshine, the people that want to produce, but the products do not get to the market. That is where we need the people who are sitting here; we have a responsibility towards all the farmers in Africa. The problem between the producer and the market needs to be resolved.”
David, added, “Understanding the supply chain from all areas is critical, and I don’t think we are doing enough of that as a collaborative growth.”
The amount of efforts contributed by each stakeholder right from the farmers to the airlines, airports, freight forwarders, regulatory authorities, are wasted if the end consumer receives flowers not in the right condition.
Kenya’s major flower body has come up with solutions to address the level of wastage. Ngige informed, “We have come up with a national standard that regulates from the breeder to the grower to the consolidator and the cargo handlers, and increasingly, we would like to involve air freight companies as well.”
“If we’ve managed to put an ‘A’ quality flower, then it must be in our interest to ensure that ‘A’ quality flower reaches the consumer and may be that way we can get few more euro cents for our hardwork,” adds Jane.
The way forward
With the growing popularity of Africa’s flower industry in the international markets, the country is looking at solutions to address the above mentioned concerns.
The multiple contributors down the whole supply chain must focus on collaboration to ensure that the integrity of the product is maintained. Shippers demand quality and reliability when placing the product in the hands of the cargo handler.
“Without collaboration in the supply chain, investments in improving the chain by one link will not pay off and it can only increase costs. A uniform standard for flower cold chains, followed by each and every link is the way forward,” suggests Jeroen van der Hulst, managing director, FlowerWatch. FlowerWatch is working on such a standard, which is already followed by growers, truckers, forwarders and retailers, who is going to follow.
FlowerWatch finds the market highly competitive. “The market is highly competitive, but we are only in business for 20-25 years, now that Kenya is among the world’s leaders in flower business, it is time to step up efforts and professionalise, improvements in cold chain, quality handling and packing will give efficiencies, these savings are within reach and seem ripe for the picking,” adds Jeroen.
Open sky policy with liberal traffic rights allowing carriers to supply competitive capacity to flower exporters is one of the changes that can give boost to Africa’s cut flower industry. Also, favourable Economic Partnership Agreements to ease taxation for flower imports to Europe as well as other global destinations can help the industry bloom.
Along with this, freight cost presents a major challenge to the value chain. Flower growers can opt for innovative and cheaper packaging to optimise box weight density that can lead to optimisation of freight cost.
Opening Image Source: Heathrow