Emebet Tesfaye, Et-Highland Flora:

"Ethiopia: "It's a struggle to break even"

"We are currently struggling to break even and sometimes we are forced not to send the flowers as we cannot reach our break even point," says Emebet Tesfaye of Et-Highland Flora, a 12.4 ha sized Ethiopian rose farm that mainly exports to Europe.

From mid-August to mid-September, the prices for roses had to be high. Unfortunately, this was not the case. Usually, they can use these higher prices as a buffer for the coming weeks, as the prices are usually low from mid September till the end of October. This combined with the decrease of exchange rate of the euro to USD puts many Ethiopian rose growers in a difficult position. "At the moment, only the fixed deals are keeping us running," says Tesfaye.

Urge Batu and Emebet Tesfaye at the BSI meeting at FloraHolland.

70% decrease
Et-Highland Flora supplies 100% of the production directly to the buyers not to the auction. A common advantage of direct sales is that you can often sell your flowers for a better price. However, direct buyers always have an eye on the auction clock. So, as the flowers are sold for low prices at the auction the direct buyers will not pay more either. From mid-August till mid September, for example, the roses prices are usually high, but unfortunately the prices for roses were extremely low at the auction during that period. "Therefore the sales of our roses decreased too. This combined with the decrease of exchange rate of the euro to USD resulted in a 60-70% lower price compared to last year," says Tesfaye. 

Struggle to break even
"Now we are entering an off-season period again, so we do not expect the prices to increase till the end of October." Due to these low prices and the unexpected low prices of the last couple of weeks, many Ethiopian growers are struggling to break even, also Et-Highland Flora. "Sometimes we cannot break even and we therefore have to decide to not ship the flowers," says Tesfaye. According to Tesfaye, the fixed deals keeps the business running. "Fortunately we've made some fixed deals. The rose prices in these deals do not depend on the auction prices."

Prices up in November
Starting mid November, the rose prices should increase again. Days like New year and Valentine's Day have to boost their sales. "So, we are looking forward to this time of the year and in the meanwhile, we just remain hopeful," says Tesfaye.

For more information
Et-Highland Flora
Emebet Tesfaye
Email: etland@ethionet.et

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