Kenyan flower growers say their industry is in good health despite rising fuel costs and growing local competition.

Export volumes rose from 48,000t in the first six months of 2005 to 50,000t in the same period this year. But the value of sales fell 15% because of foreign exchange fluctuations. "This has not been an easy year," said Erastus Mureithi, chairman of the Kenya Flower Council.

"We must strike a balance between labour and other costs and pricing ourselves out of the market. The balance is a delicate one and the industry is looking at greater mechanisation to improve competitiveness."

Despite Ethiopian and Chinese competition, Kenya carved out a 31% share of the EU cut flower market. New markets in Italy, Poland and Dubai were developed.

However, the Kenyan industry stands to lose out from higher EU tariffs unless a trade deal is agreed before 2008.