December Issue 2 2011

Oserian joins Climate Neutral Network in efforts to reduce global Carbon Footprint

Oserian Development Company Ltd, a member of Kenya Flower Council, has joined the Climate Neutral Network (CN Net), an initiative of the United Nations Environment Programme (UNEP) aimed at reducing the carbon foot print worldwide.

Under the new partnership, Oserian will participate in information exchange and networking aimed at achieving low carbon emission and eventually a climate neutral society.

Oserian’s participation in the CN Net project is part of the company’s greater strategy to achieve its goals of a sustainable farming practice that currently encompasses the use of geothermal power in the flower farms.

The flower farm makes good use of geothermal energy from the less productive, but already existing wells drilled before the testing phase and the UNEP/GEF (Global Environment Facility) intervention.

Geothermal heat is not only used to power the greenhouses but heated air pushed through the vents acts as a natural fungicide. Oserian’s growing techniques include hydroponics, geothermal heating along with natural pest management using predatory mites that feed on red spider mites.

“Oserian utilizes eco-friendly, alternative energy sources leaving a much reduced carbon footprint. We currently operate the largest geothermal greenhouse heating project in the world. Geothermal energy has made a greener business, reduced the need to farm more extensively and allows us to release land back to conservation projects,” says Hamish Ker, Oserian Production Director.

Mr. Ker said the involvement of Oserian in the UNEP programme will assist the company in the optimum and sustainable utilization of natural resources, reducing pollution and waste, and assisting in the conservation of Kenya’s unique indigenous flora and fauna.

Oserian’s Integrated Pest Management system has resulted in a 100 per cent phase out of acaricides and World Health Organization Class 1 chemicals for pest control by using natural predators to control pests that affect flowers and managing the chemical applications during times of outbreaks.

The farm’s hydroponics system also ensures a minimal water use and fertilizer application is specially developed for the targeted flower crop.

Oserian has also put in place a waste management strategy that ensures the recycling of its waste produce, and is currently working on a project to harness methane from the waste generated within the housing estates.

Acording to Mr. Ker, with more efficient and intensive use of their land resource, they are able to produce premium quality flowers as well as conserve wildlife in an 18,000 acre conservancy and corridor linking Oserian conservancy to Hell’s Gate National Park through the Oserian wildlife corridor.

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The conservancy is now home to a diverse range of species from giraffe, zebra, buffalo, leopard to multiple plains wildlife such as Impala and Thompsons gazelle. The Geothermal energy, aside from supplying power is successfully driving business and supporting conservation, with one feeding and supporting the other leading to “Conservation through Trade”.

Oserian is currently undertaking afforestation and the company’s tree nursery generates over 50, 000 seedlings a year which are planted in the company premises while the rest are supplied to the community for various tree planting projects.

Kenya flower industry to set up a pooled carbon credit scheme

By Catherine Riungu

The flower industry in Kenya is in the process of setting up a pooled carbon credit scheme.

The Kenya Flower Council Chief Executive Officer, Jane Ngige, says the industry is looking at counting all trees planted by each farm to form a “flower industry forest” and front the numbers as a single carbon sink.

“We are in the process of auditing existing clean energy schemes with a view to replicate these in all farms to collectively earn credits that would be ploughed into more activities so that in the final analysis, the entire industry can lay claim to being a major player in climate change intervention measures,” she said.

The Ministry of Environment is already working with two growers on a pilot scheme to convert farm waste into biogas, and if successful, the firms- Simbi Roses in Thika and PJ Dave in Kitengela will be used as models to replicate the concept in others.

PJ Dave farm manager, Peter Kiarie, said flowers produce substantial waste which, if converted into biogas, would save the country considerable hydro electricity units.

Currently, most of the flower waste is composted and in a few farms, such as Vegepro, is being used to make liquid organic fertilizer.

A number have already installed clean energy projects key among them Oserian Development Company that has established the world’s largest geothermal heated greenhouse. The farm generates 95 per cent of its energy requirements.

Another milestone is the giant solar energy plant run by Bilashaka Flowers, the clearest indication that the country is yet to exploit clean energy.  Managing director, Joost Zuurbeir, says that two years after the multi-million project was launched in 2006, the farm had recouped its investment and has since made substantial savings on the kerosene that was initially used to heat the greenhouses. “The result is a cleaner, healthier flower from a cleaner environment”, he said adding that their flowers are rated premium in the markets because they score highly on environmental audits.

Mr. Stephene Mutimba, the Managing Director of Camco, an energy consultancy firm, that has been contracted by the flower industry to study the existing and untapped potential of producing and using clean energy recommends pooling of resources and supporting the smaller farms to install solar panels depending on size of farms and other possible initiatives. “The idea is to establish a revolving fund where farms can borrow money to set up clean energy initiatives,” he said.

If the programme, which is expected to kick off mid next year succeeds, Kenya will reaffirm the position that flowers produced in the country emit less carbon despite being airlifted to the markets.

Four years ago, there was a major debate in Europe as claims gained currency that transporting flowers and other horticultural produce  amounted to huge carbon miles, with some activists clamouring for a boycott of air freighted produce.

This prompted a study which established that growing and flying fresh produce from the country produced far much less carbon than European grown products because of the high energy requirements there to heat greenhouses and extend day-light.

In addition, Mr. Mutimba said, there are no special cargo planes that deliver fresh produce only but the stuff sits in the belly of passenger planes meaning there is no increase in carbon per unit.

A World Bank study that looks at the impact of climate change in the flower industry has established that growing zones have shrunk because ideally, they do well in temperatures ranging between 25-30 degrees Celsius. “Due to global warming, temperatures in most traditional zones are going above this range. In certain regions, boreholes have dried up leading to increased spending on water and energy making farms unsustainable”, the report says.

According to Camco that carried out the World Bank study countries with less harsh climates such as Uganda, Tanzania and Ethiopia could in future be more attractive than Kenya as flower producing regions.

The study recommends that flower farms pool together to form a grand carbon credit scheme and collaborate in various environmental-friendly activities such as planting more trees, collecting and recycling water.

Farms such as Kisima in Timau have shown that if all farms collected all the water captured by greenhouses when it rains, they can last a season and contribute massively to water saving efforts. Martin Dyer, the Kisima General Manager recommends that the industry should have a policy that ensures all greenhouses collect both roof and storm water when it rains which would make a lot of difference in the water situation in the country.

Kisima and a neighbouring flower farm in the Nanyuki region Tambuzi have also joined in the clean energy efforts, with the latter developing solar lanterns for its staff while the farmer has set up a community biogas plant that is being used by villagers in Buuri district for cooking.

Hard times for flower growers in Uganda

Ugandan flower firms are experiencing tough times as costs of production escalates while there is a fall in flower demand. This could be read in the Ugandan newspaper Daily Nation. Experts say the volumes of flower exports are gradually dropping due to reduction in orders as the euro zone debt crisis takes its toll on European countries.

“The dipping demand in European countries especially Netherlands and the bad economic climate characterized by the depreciation of the Shilling, high inflation and high interest rates have deeply affected the sectors performance,” Mr Daniel Karibwije, Director Trade Promotion and Public Relations at Uganda Export Promotion Board said.

Escalating costs
Mr. Karibwije explained that since the flower sector depends on imported inputs such as chemicals and fertilizers, a weak shilling and high interest rates escalate costs of doing business.

“Stiff competition generated by neighboring countries especially Kenya is also among challenges negatively impacting on the sector,” he added.

He said Kenya is privileged with Kenya Airways that offers incentives to customers thus forcing the latter to prefer trading with Kenyan firms than Ugandans.

Germany, France, Netherlands and Spain are the biggest consumers of Ugandan cut flowers. Currently, those countries are tightening their spending on non-essentials, causing a significant negative impact on Uganda’s flower export levels. For over three years now, the sector’s volumes of exports has been facing ups and downs as the macroeconomic instability also affects local businesses.

Credit crunch
The hard times begun with the credit crunch which affected Uganda’s flower exports by almost 50 per cent, players in the industry say. This led to the closure of some flower farms in Uganda, employees in most of the farms were laid off and those who remained had to endure salary cuts.

When the industry was still trying to find its footing, then came the volcanic ash. This also led to dumping of flowers and eventual loss of millions of shillings, contracts and jobs. This saw the volume and value of flower exports fall from 6,460 tonnes valued at $32 million in 2009 to 5,360 tonnes valued at $28 million in 2010.

Abnormally high
The managing director of Wagagai flower firm Pim De Witte, echoed similar sentiments. He said the costs of production have remained abnormally high affecting the growth of the industry. “The Business is tough,” De Witte adds, “Increasing costs of inputs, incessant power outages and unstable power supply, high fuel prices, price fluctuations among others are giving us hard times,” He explained that currently his company uses more than 10,000 litres of fuel per month.

Meanwhile, as the shilling starts to appreciate and the inflation eases, Mr Karibwije said flower dealers are now hopeful that business will get better. “It looks like the market will stabilize with prices going back in the expected range,” he said.

Source: Hortibiz

FLP certification benchmarked with FFP standard

Last September the Flower Label Program (FLP) certification scheme was successfully benchmarked with the Fair Flowers Fair Plants (FFP) standard. All FLP-certified producers can now market their produce under the FFP-consumer label, when they become an FFP participant.

These FLP producers can extend the FFP assortment at short notice. Due to the recent increase of FFP points of sale in Europe, these flowers will be more than welcome. At the same time, FLP is the first consumer label which enables it’s growers to market under FFP as well.

New rates for CC containers at FloraHolland

FloraHolland will introduce a new rate for CC Containers from 2 January 2012 given the developments in the market. According to Flora Holland, they have been forced to conclude that the current structure is no longer sufficient and is not future-proof. They discussed the new rate structure with both the Plant Sounding Board Group and the VGB.

The new structure is based on customers paying for the services they use. This means that customers who bring about, for example, depot handling or storage costs will pay for this. The rates apply to all users of CC containers via FloraHolland (incl. Tradepark Bremen and Boskoop) and for customers of Veiling Rhein Maas (who process their CC balance via FloraHolland)

– The daily rental of frames and plates will be decreased by 1/3.

– There will be a transaction fee for each depot collection and distribution.

– There will be a daily rate (5 days per week) for the storage of CC containers and plates (the current collection ceilings will be discontinued).

– Transfer will be possible at a fee, either by fax or via a subscription to the Logistics Resources Online service. Both parties will be charged for this action.

– The Logistics Resources Online service (also known as Avalanche webview) will become a paid service (subscription) as of 2 January 2012. Depending on your requirements you can choose from three subscription types:

  1. Basic: regular use (access to balance, transactions and documents).
  2. Premium: options of Basic + one-sided transfer where you relieve the other party of an obligation.
  3. Advanced: for logistics service providers. Options of Advanced + two-sided transfer1. With a two-sided transfer both you and the other party can be charged

In 2012, there will be no charges for handling, transfer and storage during the peak period. This will be reviewed for 2013. The peak period in 2012 runs from week 11 through week 23.

The new rates are listed in the table below. The rates depend on the usage and subscription type.

General Frame Plate
Annual subscription ‘Basic’ €50
Annual subscription ‘Premium’ €150
Annual subscription ‘Advanced’ €1,000
Handling costs (per transaction) €1.50 (per receipt) €0.06 €0.01
Storage costs*(per day) €0.04 €0.01
Transfer* (for both parties) €0.02 €0.005
Fax transfer through Danish trolley administration (tariff charged per frame and plate is for both parties) €10 (per transaction, only to be paid by the client) €0.02 €0.005
Daily rental €0.63 €0.10
Peak daily rental €0.95 €0.16

* Depot handling, transfers and storage costs are not charged during the peak period of 2012

The cost of the subscriptions will be charged in mid-2012.

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