African flower trade yet to find air-sea balance in logistics

Air cargo has been an indispensable part of African flower export and will continue to be. However, a modal shift from air to sea is getting established due to sustainability, lack of capacity, costs and competitiveness. It is time for the air freight industry to revisit its value proposition.

“When the Red Sea crisis started, we had a lot of containers on the high seas close to the Red Sea. We were very happy that air freight was there because we had all the containers dropped off in Jebel Ali and we flew 100 percent of all the flowers to Amsterdam, Brussels and London.”

Christo van der Meer, manager sea freight perishables at Kuehne+Nagel East Africa, was speaking about the state of flower logistics in Africa and the recent trends of modal shift from air to sea at the recently concluded Flower Logistics Africa 2024 conference, organised by Logistics Update Africa in Nairobi.

His words clearly demonstrate how important airfreight is for the global flower supply chain and logistics. In fact, air freight used to move the majority of flowers produced in Kenya, for instance, to Europe and other parts of the world until the Covid-19 pandemic.

Kenya is the 4th largest exporter of cut flowers in the world, according to the Observatory of Economic Complexity (OEC's) 2022 data. In the same year, cut flowers were the 2nd most exported product in Kenya. The main destinations of cut flower exports from Kenya are the Netherlands, the United Kingdom, Saudi Arabia, Germany, and the United Arab Emirates. In 2023, according to the Central Bank of Kenya (CBK), Kenya exported 110,811 tonnes of cut flowers compared to 127,406 tonnes in 2022, showing a drop in volumes.

“We are talking about the sea project. But it is not a project anymore, it's there and is there to stay.”
Christo van der Meer, Kuehne+Nagel

Until the pandemic, the Kenyan flower industry had enough air freight capacity and the freight rates were fair. Due to the perishability and dynamic nature of the market, Kenyan flowers always took the airfreight way. However, Covid-19 changed the equation completely. Movement of flowers from Kenya was affected in the year 2020 which saw all passenger planes grounded for several months and registered exuberant freight rates. The industry turned slowly to sea freight for more reliability, lower prices and better competitiveness.

In 2022, Kenya Flower Council (KFC) and the Netherlands signed a framework of cooperation to adopt sea freight for perishables from Kenya and in 2023, Kenya began transporting horticulture produce through the Mombasa port.

Karen Rono, head of integrated sales, cold chain Eastern Africa, A.P. Moller-Maersk, reported that the shipping company moved 46 containers of flowers from Kenya during Valentine's Day of 2023.

“I wouldn't say they didn't have quality issues, but they were not as big a concern as causing a very big outcry in the market,” she said.

The reason why she spoke about last year's numbers is that the sea freight project for flowers and perishables did not materialise this year due to the crisis in the Red Sea and longer transit times.

Lina Jamwa-Musibi, membership, advocacy and communications manager, Kenya Flower Council (KFC) noted that ocean movements of flowers are not happening now due to the Red Sea crisis.

“The experiments to move flower shipment through the ocean have been successful even though it is not suitable for certain varieties of flowers. Jeddah has been an important transhipment hub for these movements and the crisis in the ocean has closed that option for shippers,” she said.

Meanwhile, van der Meer reminded the delegates that sea freight for flowers is here to stay.

“We are talking about the sea project. But it is not a project anymore, it's there and is there to stay. And the main driver is cost and lack of air freight capacity. I can't offer any sea freight at the moment, although we're shipping two containers this week. But it will remain in small numbers,” he said.

“I never see it as 100 percent ocean or 100 percent air. That fine balance is what will be decarbonising our supply chains.”
Karen Rono, A.P. Moller - Maersk

Apart from the pandemic, there was also a growing concern from final customers on decarbonisation which has become an important factor that is pushing flowers away from air to sea.

Rono opines that the shift was already there in the agenda due to sustainability and the pandemic only accelerated the change.

“It was coming. The pandemic probably rushed it to come way ahead because trials have been there for quite a while to get flowers by ocean working. The idea was to become the other option, an intermodal option of being sustainable and decarbonising logistics,” she said.

van der Meer also thinks the game changer in this equation will be decarbonisation.

“The European Union has to be carbon neutral by 2050 and there are milestones in 2030, 2035 and 2040 where you have to justify as a big company, the amount of carbon you have produced including your supply chain. If you want to sell flowers from Kenya you need sea freight,” he added.

“A few years ago, we thought in the air cargo industry that flowers and perishables were protected products. We didn't see any competitors in that. It was a mistake.”
Eric Dumas, Ostend–Bruges International Airport

Eric Dumas, CEO, Ostend–Bruges International Airport (OST) acknowledged the change as a significant trend and pointed out the fundamental shift in consumer behaviour for the modal change.

“The shift started during the Covid-19 pandemic due to the lack of belly capacity of passenger flights and we might have thought that after the pandemic things would go back to normal. It was not true because, in the meantime, there were some new habits of the consumers which have changed dramatically with worry about the carbon footprint of what they buy every day. In Europe, several shops are announcing that they don't sell goods which come by flight to Europe,” he said.

He also noted that the air transport industry is facing a real challenge to deal with these new competitors.

“A few years ago, we thought in the air cargo industry that flowers and perishables were protected products. We didn't see any competitors in that. It was a mistake. And now it's not true anymore. And more than this, there is cost efficiency offered by sea freight,” he added.

Ocean freight is certainly offering a better, sustainable, cost-effective, competitive mode of transport for Kenya's flower trade. In fact, the Kenya Flower Council has set a target to have 50 percent of Kenya’ flower export be done by sea by 2030 from the current five percent.

Talking about the challenges of achieving the target, Rono noted that sea freight will require much better technology, processes and investment to handle flowers because of the extended cold chain requirements.

“We can't handle sea products the same way we handle the air. We need to upscale our cold facilities. But if we have the right process and the right facility, the extended transit time will cease to be a problem. Because the shipping lines are working on the technicalities and upscaling of the reefer container,” she said.

She also pointed out that there is a need for balance between the air and sea modes to achieve decarbonisation.

“When we talk about air versus sea, the decarbonisation is between 80 and 90 percent. Then if we go the extra mile like Maersk has done to go to green methanol, that decarbonises even further. Shipping is already decarbonizing quite a lot. If you go a step ahead, which is what the airlines are also doing with sustainable aviation fuel, to have it on the ocean, and then you can marry the two. There's always going to be a balance between air and ocean. I never see it as 100 percent ocean or 100 percent air. That fine balance is what will be decarbonising our supply chains,” she said

Covid-19 was a driver for change because of lack of capacity. Right now, for most of the shippers or buyers, it is the cost. In the end, sustainability decarbonisation will be the biggest driver. For whatever it may be, airfreight needs to be prepared to find that balance of sustainability and keep a significant share of flowers with itself.