Review

Proflora 2005: the brig

Arriving in Cartagena, Colombia,
visitors are first overwhelmed by the
sweltering heat of this beach town on
the Caribbean coast, and then by the
striking flower arrangements in the
airport hall, courtesy of Colombian
growers. This shock-and-awe campaign
works, the murmur is audible and
tourists literally get out of line to touch
them, not sure whether the colours and
sizes are real.
Colombian president lvaro Uribe (second from right), to his right is Ernesto Vlez of Asocolflores. The flower
By Mauricio C. Mathias sector is responsible for 95,000 direct jobs plus 80,000 indirect ones.

ices ranged from internet flower auction to

roflora is held every two years tors initial success and a driving force for

P logistics, and customised process software

and the eighth version took place
for growers. Proflora, mainly a cut flower
in October with more than 200
show, is the largest of the Americas.
exhibiting growers, breeders,
Living up to its reputation of flower
propagators, service and material suppli-
export giant, Colombia sells 95% of its
ers. A high level of diversification in this
its present day modernisation. Responsible
for 75% of all flower shipments,
Asocolflores started out as the sector united
to deal with protectionist measures by the
US market curbing the growing imports of
production overseas (200,000 ton/year),
now mature industry was evident with the Colombian flowers, back in 1973.
which makes the country the worlds sec-
growers only outnumbered by the 43 serv- Membership has been growing since; last
ond overall flower exporter and number
ice providers. Cluster development, rather year it went up from 200 to 220 farms.
one carnation exporter. Exports have aver-
than just an increase in growers, has been Ernesto Vlez, president of the Board of
aged US$700 million annually (Figure 1).
one of the successful strategies. Other serv- Directors at Asocolflores and owner of
The international nature of Suasuque Farms recalls: Initially the
Proflora was clear in the Colombian flower industry had to deal
Figure 1. Colombian flowers is a 35-year old industry with
auditorium: speeches in with dumping allegations from the
steady growth based on organisation and overcoming
English only, signs in Colorado carnation industry, and later on
successive challenges.
German and Russian, and the Californian rose growers. Twelve years
250 900 group conversations in and many millions of dollars later, spent
Spanish flowed in accents on attorneys and lobbying, all sides agreed
Values in US$ (million)

800
Volumes in kg ('000)

200 Net weight (Kg) from different countries. The that joining forces was a better way to bat-
700
Values importance of flowers in the tle a common enemy: stationary con-
600
150 Colombian economy was sumption in the American market. Along
500
highlighted by the president with the relatively low per capita flower
100 400
himself, lvaro Uribe, at consumption, these are the main chal-
300 Profloras opening ceremony. lenges in a market that is still mostly driv-
50 200 en by celebration dates.
100 Asocolflores Vlez continues Carnations and
0 0 The Colombian Association chrysanthemums started this business, and
1992
1978

1982

1996
1986

1990
1980

1984

1994

1998
2000
2002
2004
1970
1972

1988
1974
1976

of Flower Exporters is both later on due to technical, commercial and

one of the causes of this sec- phytosanitary issues, diversification came

24 FlowerTECH 2005, vol. 8/no. 8 www.HortiWorld.nl


ghter side of Colombia
with roses and others such as freesias and
gypsophila, now there are more than 50
products. Bouquets for supermarkets is a
growing trend: 15 years ago its market
share was only 5%, against 50% today.
Supermarket sales mean mass production
and price reduction. In the last seven
years, the world flower trade went up 62%
in volume, but only 2% in value, putting a
price squeeze in the sector that we have
had to adapt to.
The word to describe the joining of
forces of Colombian growers and the US
wholesale/retail industries is interdepend-
ence. Today 85% of all Colombian flowers
go to the US, an average of 60% of all
flowers imported into the US come from
Colombia, and some flowers such as car-
nations and alstromerias exceed a 90%
market share. The resulting unique mutual
reliance is such that representatives of the
Colombian growers now contribute to,
and hence have seats in, the Boards of
many American trade associations, such as
the Society of American Florists and the
Flower Promotion Organisation; the latter
being in charge of increasing consumption
of flowers, so that today Colombians par-
ticipate at an institutional level in the US
home market. In a reverse trend, fruit
giant Dole bought a number of large
Colombian farms 8 years ago and now
sells its own flowers, which correspond to
15% of Colombias flower exports.
Unable to compete with the price and
quality of flowers grown at a nearly ideal
climate, some American growers have
closed, others however became importers.
Wholesale evolved where there was
already a tradition for certain crops, roses
in California and carnations in Colorado,
for example. Other sectors, e.g. air trans-
portation and flower trading/distribution,
boomed in Miami, destination to nearly
all incoming Colombian flowers. Royalties
have also been another major source of
revenue to US and European breeders.
In the end, according to Asocolflores, it
is estimated that for each dollar received
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by the grower, about 10 times more is paid
by the end consumer, showing that a
much larger part of the chain is in the US,
encompassing importers, shippers, whole-
salers, retailers, marketers and so on. And,
while 200,000 Colombia jobs depend on
the flower sector, in the US it is 220,000,
so that there is more added value on the
importing side than in Colombia.
Flor Verde
All that may be history now, but the Flor
Verde label (literally Green Flower), a
combination of social and environmental
protocols, is todays apple of Asocolflores
eye. It has been changing the sector for 10
years, achieving great reduction of chemi-
cal use, recycling of rainwater captured by
greenhouses (thus reducing flooding),
increasing average wages and forbidding
child labour. A school of floriculture has
been created to train new workers, many
of them displaced population, an expres-
sion describing those who had to leave
homes in the civil war zone.
To date, 56 out of the 141 farms partici-
pating in this voluntary program are certi-
fied by the Swiss-based SGS auditing com-
pany. Expectations are that all member
farms will participate in the next three
years, for this is an ongoing program
devised for the sustainable growth of the
Review
The 2005 Proflora
edition had more than
200 exhibitors and over
5,021 visitors from 40
countries.
whole industry. Social achievements, such
as 13% of flower workers belonging to
labour unions, against 5% of the national
average, have been recognised as
Asocolflores won the British & Colombian
Business and Social Award.
Times of change
Market diversification to maintain growth
is a likely trend for the sectors future,
says Juan Piedrahieta, Queensflowers
Group, with EU, Russia and Asia as new
options. Colombian participation in the
growing Russian market is recent, but last
August Asocolflores had its first stand at a
Moscow fair and even won two quality
prizes. We will be at HortiFair in
Amsterdam too.
His group is comprised of independent
farms that split costs, buying supplies
together and trading under the same
brand name. His opinion of the present
moment is the same as everyone at the
event The two biggest challenges for flow-
ers now are the Peso revaluation and
flower overproduction. Revenues have
decreased with the 22% Peso appreciation
to the US dollar since 2003. There is also a
25% excess on offer, to a market that
grows 3% yearly. Its not crisis-mode yet,
but there is great expectation to see where
it will all go. Its very different from the
FlowerTECH 2005, vol. 8/no. 8 25
Review
The Bogota plateau alone, home to 85% of the Colombian flower acreage, still has 200,000 ha of flat, available
land.
last Proflora, when people were investing.
In addition, Colombian inflation, around
6% yearly, has eaten away any price gain
we might have had overseas. And that is
the average inflation, the sectors actual
inflation is twice that much due to record
oil prices, since we are so reliant on plas-
tics, fertilisers and aviation fuel whose
prices are very oil-dependent.
Since growers cant change the prob-
lems, this price-crunch has made us more
cost-aware. Labour, being 50 to 60% of
our final cost, has received the most atten-
tion, and staff training to raise efficiency is
already happening. The average worker
makes around US$ 240/month and even
though there have been no major layoffs
yet, its a risk - we are all in the same boat.
Moments like this may be a window of
opportunity for use of technology as well.
We have been a very organised sector, but
not a highly technical one so far. Now
there is a growing interest in thermal
screens, heaters and greenhouse ventila-
tion so this could be a turning point for
those willing to adopt a different cultiva-
tion approach, Piedrahieta concludes.
Marius Kooij, director of P. Kooij and
Zonen, a carnations-only breeder and
propagator present at Proflora, sees the
same issues and believes that they are
temporary, not structural problems in the
sector. There are around 3,000 ha of roses
in Colombia, but they are also produced
in other countries; Colombias 1,500 ha of
26 FlowerTECH 2005, vol. 8/no. 8
carnations on the other hand have no
competitor at this level. A company pres-
ent in Colombia since the 70s, Kooij has
seen changes: Only 10 years ago it was all
soil-cultivated, now everything is grown in
coconut fibre or rice husks. Destinations
have diversified to the EU and Japan,
which is a market that demands specific
varieties and a broad assortment. With
good shelf life and plenty of types, carna-
tions are back in fashion again. Its a buy-
ers market; however, growers with a
reduced cash flow are renewing their
plants less frequently.
Outlook
Colombia has had tremendous help from
nature, but the bliss of good weather at the
2,500m-high Bogota plateau with 12 h of
daylight may have hidden the possible
production gains via climate control.
Whereas quality flowers grown at reason-
able cost is definitely a competitive advan-
tage, higher yields is one area with room
for improvement. So is the adoption of
automation systems in general, with an
average 17 workers/ha, it is a very labour
intensive industry. The EU and US growers
had to face a production cost shock when
developing countries became competitors.
Colombians now have to deal with a rev-
enue loss due to an unfavourable exchange
rate. The answer may be the same though:
increased yield via technical investments
with returns from the lower unit costs.
The country also has favourable logistics,
with a 3-hour flight to Miami and plenty
of airfreight companies (there were 17 at
Proflora) that result in US$0.9/kg of
cargo. Its greatest advantage though,
seems to be the entrepreneurial level of its
growers. The degree of organisation of the
flower sector, not common in developing
countries, has been present from the start.
With free trade agreements being negotiat-
ed with the US, Colombia risks increasing
its dependency on the American economy
even more. But market diversification is
being sought; sales to Europe and else-
where slowly develop. Its dependence on
the US may be under review, but this
main market still has great potential for
growth as well. Crop diversification has
also increased lately, and the country has
more microclimates to explore, tropical
flowers for example were also present at
Proflora.
Colombian flowers have faced bigger
challenges in the past: trade disputes, phy-
tosanitary issues and the image of an
industry not friendly to the environment
or its workers. As each was overcome the
sector improved, and even though there
are still problems, they are being
addressed by Asocolflores members. This
association has acted as a true sector
organisation, working on long-term issues
leading to sustained growth rather than
short-term goals of individuals. Social
responsibility as an added value to their
flowers seems to be more than a fad.
Most people have seen Colombia in the
news associated to its regions with guerril-
la and drug problems, and these issues are
real, but there is just as much good news
happening in the flower sector. Anna
Bueno, Asocolflores PR Director puts it in
a nutshell: People dont have to believe
what we say; they should come and see for
themselves. The brighter side of
Colombia, as the sector calls itself, seems
like a good name.
mauriciomathias@hotmail.com
www.HortiWorld.nl