Friday, April 16, 2010

Keynan Flowers and the Volcano---The interconectedness of International Trade...

The inter-connectedness of international business....
From  BBC: Kenya flower industry hit by flight cancellations
Kenya's flower industry has been badly hit by the cancellation of flights across Europe because of the ash cloud caused by a volcano in Iceland. 
The head of the Kenya Flower Council told the BBC it was costing growers between $1.5m and $2m a day.
She said about 500 tonnes of flowers were currently being kept in cool storage at Nairobi's airport.
Flowers are the East African country's biggest export earner, accounting for about 20% of all exports.
Flower trucks arriving at Jomo Kenyatta International Airport on Friday morning were being turned away.
"On the flower farms we have to continue harvesting the flowers," Kenya Flower Council chief executive Jane Ngige told the BBC's Focus on Africa programme.
Every day we deliver about 12 to 15 tonnes of roses and that translates to about 6m to 7m [Kenyan] shillings, Sian Roses manager Haroun Koimur "Even if this cargo was to be lifted we have a problem of eroded quality so it would fetch much less than if it had left fresh," she said. 
The manager of Sian Roses near the capital, Nairobi, told the BBC the business was incurring loses of up to $80,000 a day because of the cancelled flights. 
"Every day we deliver about 12 to 15 tonnes of roses and that translates to about 6m to 7m [Kenyan] shillings," Haroun Koimur said.
He said some staff had already been sent home until it became clear when flights would resume again.
The BBC's Anne Waithera in Nairobi says the industry has recovered from the post-poll violence in 2008, which particularly hit farms in the Rift Valley. 
But she says this could prove a bigger blow if it continues as it affects growers countrywide.
According to the Kenya Flower Council, 97% of all Kenya's flower exports are sent to the European Union.
About 300 growers employ an estimated 100,000 people, with about 1.2m people deriving their livelihood from the flower export industry.
The Eyjafjallajokull volcano system began erupting on Wednesday for the second time in a month, hurling a plume of ash 11km (seven miles) into the atmosphere.
Scientists say the volcano is still erupting but producing less ash and flights are likely to be disrupted into the weekend.
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