For Ambachew Amare, there is only one way out of the current market problems that he is having; to look for investors. As manager of Temret Irrigation Development & Marketing Union in the Southern Region, Buta Gira Zone, he chose to represent his union in the fifth International Floriculture & Horticulture Trade Fair, held in Addis Abeba, at the Millennium Hall, from March 20 to March 22, 2013.
When the Union was first established, in 2010, with 18 cooperatives and 1,157 member farmers, it was planning to produce vegetables, like; onions, tomatoes cabbages and potatoes. It had plans to expand the 321ha of farmland that it had already acquired to 20,oooha.
However, right after the first harvest in 2012, the price for its products began to fall in the market and the Union earned only 6,000 Br profit from the 196,000Kg of vegetables that it took to the market.
“The local market is very frustrating,” complained Ambachew, referring to the onion market that is currently offering farmers 0.90 cents a kilo. “That is why we are looking for exporters.”
Ambachew believes that his Union could get at least one exporter for its products from the trade fair. One hundred companies from 10 different countries that are involved in growing vegetables, fruits and flowers, and supplying inputs, are participating.
Although he has not yet made any formal agreements, Ambachew was contacted by two foreign companies, from China and India, and a local company, with an interest in exporting the Union’s products, according to him.
The Gamo Gofa Fruit & Vegetables Producers Union, from the same region, was part of the fair in 2011. It returned again this year. Tamerayehu Mersha, one of its managers, is confident that they will find a market to export to. The Union produces bananas, apples and mangoes. It has 21 cooperatives with 5,000 farmers and a capital of seven million Br.
During the 2011 trade fair, the Gamo Gofa Union made an agreement with International Saudi Agri Private SC, a Saudi company, to export its produce. In the past year, it has managed to export 160,000Kg of bananas to Saudi Arabia and is planning to deliver more over the next six months.
The trade fair, which aimed at bringing business opportunities for all participants in the sector, including; breeders, growers, transporters, investors and machinery manufacturers, has focused only on sharing experiences, rather than, too, inviting consumers.
There are 152 companies involved in the horticulture sector in the Southern Region, with a total capital of 3.956 billion Br. Out of this, 24 of them are foreign companies, 16 are working as joint ventures and the remaining 112 are local companies, according to Abera Taye, from the Investment Bureau of the Southern Regional State.
One of these companies, which is growing flowers on 1,000ha land, Langano Lili, was awarded the best grower award by the Ethiopian Horticulture Producers & Exporters Association (EHPEA), during an award ceremony on Thursday, March 21,2013, at the Hilton Hotel.
“Our goal is to create contacts between buyers and suppliers to bring business opportunities, not for consumers to buy products exhibited in the fair,” said Dick van Raamsdonk, president of HPP Exhibitions, organisers of the trade fair.
The 90 participating exhibitors, including investment offices from different regional states, filled the Millennium Hall.
Amhara, Southern, Oromia and Tigray investment bureaus brought data and a list of investment opportunities in their respective regions. They informed participants of the amount of land available for horticulture and encouraged them to visit.
Oromia already has 244 companies involved in horticulture, on 11,061ha of land, with a cumulative capital of 3.98 billion Br.
“The exhibition has proven to be the right platform to find new markets, exchange ideas and to learn of new developing trends in the industry, as well as to discuss challenges and opportunities,” said Zelalem Mesele, chairperson of the EHPEA.
The sector is the fifth most important foreign exchange earner in Ethiopia, after the narcotic crop, khat.
Floral Holland, a flower growers cooperative, was also present at the trade fair, representing 55 Ethiopian flower growers that are its members. The company has two offices in Africa, one in Ethiopia and another in Kenya. It also has six auction and export centres in the Netherlands for the flowers it handles.
According to Jospher Veldkamp, manager of the Flora Holland Ethiopia office, the member flower growers produce five top flowers, including; roses, lilies and gypsophila, on 1,300ha of land.
“The biggest challenge for growing roses in Holland is providing heat and light during the rainy season. In Ethiopia you do not need to provide heat and light for the roses, they grow naturally,” he said.
Floral Holland has an annual turnover of 5.45 billion dollars, with the Ethiopian companies that are its members accounting for 214.22 million dollars, according to Veldkamp.
However, the overall export performance of the sector is far below expectations, in terms of generating foreign currency.
This underperformance is attributed to a lack of good management, quality control problems, and a lack of modern technology, according to Zelalem.
The sector is also operating with lots of challenges, which require government intervention, he added. The new investment policy lacks an understanding of the sector, in terms of relevant incentives, he said, and there is a lack of access to land for expansion; air freight cost is high and the intellectual property rights of breeders are not respected.
In spite of the challenges, the industry has utilised 1,300ha of land it has also repatriated 260 million dollars from floriculture and 50 million dollars from fruits and vegetables, as well as creating 85,000 jobs.
“The trade fair is a chance to reflect on our journey during the past 10 years, build a good image for the country and show the quality of our products,” said Zelalem.
Gedeb Engineering PLC, a local company, took part in the fair to find a market for its agricultural equipment and irrigation products. Greenlife Trading PLC came forth with pesticides, fertilisers, seeds, sprays and planting materials that it has imported from different countries.
“Here we have communicated with different agricultural inputs producers and suppliers that we need for farming,” Ambachew said, in line with Zelalem. “We all need each other.”
Established in 2002, the EHPEA currently has 83 members and manages the international trade fair every two years. According to the EHPEA, negligible amounts of high quality fruits and vegetables have been exported to countries in the Middle East, such as; Saudi Arabia, Bahrain and Kuwait. Fruits that are exported to European markets include; strawberries, fresh green beans and cherry tomatoes.
Bananas, oranges, avocadoes, mandarins, papayas, guavas, limes and apples are also exported to the Middle East Market.
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