Colombia is heaven-made for year round flower growing

Colombia is heaven made for year-round flower growing. It possesses a mild equatorial climate, long days, fertile soil, abundant water, modest wages and favourable trade conditions with important markets (US, EU). So within decades Colombia has become, and still is, the world’s second largest flower exporter. Yet the Colombian floral  industry is now faced with uncertain times. Why?

 Figures

Recent Colombian export figures were unremarkable. In 2016, exports stabilized (in US dollars) but it took a 5.1 percent increase in kilos to reach this level of stability. Prices dropped due to currency issues (UK) and economic changes (Russia). Meanwhile, Colombia built up markets in EU countries like Poland and the Czech Republic, although these sales are relatively small compared to the largest market by far, the USA. Over ¾ of Colombian flowers are sold to American consumers.

Roses, carnations, alstroemeria, hydrangea and chrysanthemum are the most important Colombian flowers. Approximately 7000 hectares are utilized for export flower production. Many of the nurseries are larger than 50 hectares. Most nurseries started as family-owned companies and still are today. They are well-run, use good equipment and good production and logistic methods and are aware of the market’s needs, such as sustainability.

Peace and problems

The recent peace agreement between the Colombian government and FARC rebels was welcomed all over the world, but in Colombia itself there are still doubts. The new situation is attracting foreign investments but locally people wonder how FARC will act under the new agreement . Former President Uribe was a staunch opponent  of drug production and trade, the major source of FARC’s funds. But since the start of the Santos administration seven years ago, drug production has tripled. Next year there will be a new presidential election and until then there will be uncertainty.

Drug production, by the way, doesn’t affect the floral industry as flowers are grown in other parts of the country.

Markets

Worldwide goods streams tend to go between south and north instead of east and west. This is readily apparent from the fact that the USA is Colombia’s largest export market. Many Colombian producers have Miami logistics and sales facilities. They have also developed new markets in Europe and Asia. In these markets they must compete with African producers who have lower labour costs. The Colombians try to save costs by using sea transport for EU and Asian exports which appears to be suitable for crops like chrysanthemums, carnations and alstroemeria, but less so for roses.

SWOT

Recently Royal FloraHolland made a SWOT (strengths, weaknesses, opportunities and threats) analysis of Colombia and its floral industry which provides strong indicators of its future prospects.