GAZA HARVEST YIELDS LITTLE EXPORT REVENUE

UNCLAS JERUSALEM 000349 SIPDIS SENSITIVE SIPDIS NEA FOR FRONT OFFICE; NEA/IPA FOR GOLDBERGER/SHAMPAINE/BELGRADE; PRM FOR PRM/ANE; NSC FOR ABRAMS/PASCUAL; TREASURY FOR SZUBIN/LOEFFLER/NUGENT/HIRSON; PLEASE PASS TO USAID FOR KUNDER/MCCLOUD/BORODIN E.O. 12958: N/A TAGS: EAGR EAID ECON KPAL KWBG PHUM SUBJECT: GAZA HARVEST YIELDS LITTLE EXPORT REVENUE REF: 2007 JERUSALEM 2567 ¶1. (SBU) Summary: Gaza strawberry and carnation export revenues were low this season in comparison to recent years, due to restricted access through crossing points and shipping procedures that reportedly resulted in damaged products and reduced values in European markets. Export earnings for strawberries were USD 224,000 this season, in comparison to USD 4.2 million last season. Export earnings for carnations have been limited to USD 677,000, in comparison to a total of USD 4.1 million last season. End summary. Strawberry Exports Limited By Crossing Closures -------------- -- ¶2. (SBU) Strawberries are considered the largest and most profitable export crop in Gaza, yet according to Gaza-based contacts and published Palestinian reports, 2007-2008 harvest exports totaled just 42 truckloads valued at USD 224,000. Due to restrictions at crossing points, strawberries were only exported from November 28 - December 18, 2007. In recent years, strawberries had been shipped as late as February. In comparison to this season's revenues of USD 224,000, the 2006-2007 harvest earned Gaza farmers USD 4.2 million in export earnings, and 2005-2006 strawberry exports earned farmers USD 3.8 million, according to USG contractors in the agriculture sector. Crossing Procedures Reduce Product Value -------------- ¶3. (SBU) During prior years, Gaza strawberries were shipped to Israel through Karni/al-Mintar commercial crossing and on sale in European markets within 24 hours. This quick timeline was not possible through Kerem Shalom, the only crossing that has been open for limited exports from Gaza since June 2007. At Kerem Shalom, strawberries were removed from cold storage and exposed to the elements for periods of up to eight hours, according to USG contractors in Gaza, resulting in premature spoilage and low prices in European markets. The crossing's inspection procedures reportedly caused damage to several shipments. Contractors also noted that the ban on imports of certain fertilizers and specific greenhouse equipment into Gaza may have limited the quality of strawberries this season. Carnation Exports Limited -------------- ¶4. (SBU) Carnation flowers are Gaza's second largest agriculture export product and yielded USD 677,000 in export earnings during the 2007-2008 harvest. In comparison, 2006-2007 carnation revenue was roughly USD 2 million by mid-February 2007 and totaled USD 4.1 million for the entire season, per USG contractors. This season, carnation exports ran only from November 20 to January 15. Since mid-January, Kerem Shalom has been closed for exports. ¶5. (SBU) There were no exports from Gaza of bell peppers, cherry tomatoes, or sweet tomatoes this season (reftel). WALLES