Cut flower market blooms for ACP producers
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CTA. 2005. Cut flower market blooms for ACP producers. Spore 119. CTA, Wageningen, The Netherlands.
Permanent link to this item: http://hdl.handle.net/10568/48021
Internet URL: http://spore.cta.int/images/stories/pdf/old/spore119.pdf
In the past 2 decades, developing countries have expanded their export share to 24% of the global cut flower market. But although there are clear opportunities for ACP producers, small-scale flower farmers still need help if they are to compete...
In the past 2 decades, developing countries have expanded their export share to 24% of the global cut flower market. But although there are clear opportunities for ACP producers, small-scale flower farmers still need help if they are to compete with the major growers. Three decades after the first forays by Southern producers into the global flower market, floriculture continues to hold out hope for ACP producers. In the North, demand for cut flowers has blossomed, especially in Europe, which imports more than 80% of world output. Kenya remains the clear leader. Between 2001 and 2003, it increased its already substantial market share of EU exports by 17%. But other ACP players have been quick to move into the field, including Cote d Ivoire, South Africa, Tanzania, Uganda, Zambia and, most spectacularly, in Ethiopia, which chalked up a massive growth of 230% in the same period The thorn on the rose The most recent newcomers are producers in the Caribbean and the Pacific. In Jamaica, a fledgling flower industry is supplying local markets and selling anthurium, orchids, ginger lilies, and heliconias to cruise ship passengers and to US customers via the internet. In the Pacific, a floriculture workshop supported by CTA in collaboration with the Institute for Research, Extension and Training in Agriculture (IRETA) has enabled one smallholder from the Solomon Islands to set up a blooming business. A number of ACP countries have comparative advantages for producing cut flowers, for reasons of land, labour, climate and preferential tariffs with the EU. But studies show that transport, storage, and distribution account for much of the value added, with production only netting 10% of the sale price. Though rewarding, the future may not be as bright as the past. The growth of cut flower production now outstrips that of demand, and ACP countries face tough competition from Colombia and China. Prices of bulk cut flowers, such as carnations, alstroemeria and roses, are falling due to over-supply; those of exotic flowers are holding up better. Tropical flowers constitute a growing niche market and popular sellers include orchids, anthuriums, gingers, strelitzia (birds of paradise), heliconias and proteas. Consumer concerns Although it was only established in 1972, Kenya s horticulture industry now ranks fourth in terms of export revenues behind tea, coffee and tourism. But such rapid growth has hidden costs. Kenya has come under fire for poor labour conditions and high use of agrochemicals. Growing pressure from consumers in key importing countries such as Germany has forced the Kenya Flower Council to set up codes of conduct. FAO has sent integrated pest management experts to Nyeri, in central Kenya, to train the 5,500 women s groups growing flowers there. Producers in the South face a number of hurdles. Flower growing is highly capital intensive and the stringent regulations in the international market such as minimum residue levels (MRLs) and other sanitary and phytosanitary (SPS) regulations are often difficult to negotiate. With such a perishable product, packaging, cold storage and efficient transport links are crucial but costly pre-requisites, and Southern producers start from a disadvantage for reasons of distance. Dutch and German companies have moved into several ACP countries so they can have direct control over quality, distribution and marketing (see Spore 85). Most cut flower producers in the South are dependent on breeders in the North for their planting material, and have to pay royalties. A future in floriculture Given these constraints, it is not surprising that much of the flower industry is dominated by large concerns. According to Kenya s Horticultural Crops Development Authority, smallholder production has declined in the past 5 years. But in spite of the obstacles, some ACP producers are forging ahead to show there can be a future in floriculture. Uganda is using hydroponics, a technique which limits pests and disease, to grow flowers. In Zambia, small-scale farmer Peter Mtumbe has switched from maize to roses and is planning to double his operation. In Ethiopia, a family firm has become a major international supplier, while in Fiji women have been helped to market flowers for export to Hawaii and New Zealand (see Spore 117). South Africa has found a profitable market producing chrysanthemums. An export guide published by the Centre for the Promotion of Imports from Developing Countries (CBI) identifies summer flowers blooms produced during Europe s winter as a promising sector. Sales to supermarkets are also increasing, a trend which opens up opportunities for ACP producers, but also poses challenges. To take advantage of what most agree is still a flourishing market, more agricultural research is needed to develop local planting material and tackle pest and disease problems. The Secretariat of the Pacific Community (SPC) is working to help Fiji flower growers deal with a fungus that is attacking red ginger (Alpinia purpurata). According to a recent CTA-supported study, producers need help with import requirements, distribution and marketing. One ingenious responses is a Flower Business Park, set up by a rose grower in Naivasha, Kenya, where flower growers pay rental fees for services ranging from land and water to on-site clearance for export documents.