Kenya: Lower returns flower growers due to falling European currencies
The euro has shed 0.29 per cent this year to date against the dollar while the British pound (GBP) has shed 3.28 per cent.
And the potential exit of Britain from the European Union called Brexit, has dampened expectations after it touched 1.40 against the dollar being an almost seven-year low.
Kenyan farmers receive their payments in euros and pounds while all their procurements except the wage bill are done in dollars.
"The strong dollar has pushed the cost of business up and the weaker European currencies are eroding profits," Ms Jane Ngige, Kenya Flowers Council boss told the Nation on phone.
CfC Stanbic Bank Regional Economist Jibran Qureishi said with Russia reeling from sanctions and economic slowdown and the euro and pound depreciating, modest players in the industry may be hit hardest.
"If you are not big enough to whether the storm you might end up cutting inventory because Russia was one of the biggest buyers," he said.
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