The sector of ornamental flowers and plants have increased a lot in the last past years, being considered as one of the most promising and important segments of agribusiness in the world. Brazil is conquering markets and gaining space in this sector.
With an industry, that in 2012, moved 21.1 billion USD with 170 countries exporting these products and 210 importing it, the sector of ornamental flowers and plants is one of the most important segments of international agribusiness.
The World Flower Production
The cultivated area in the world is around 424,000 hectares (ha), and with the United States, Netherlands, and Japan holding 20% of the cultivated areas. Canada has the largest surface in the world to be explored by floriculture, with 96.172 ha. This country is followed by:
- China (80.000 ha)
- India (65.000 ha)
- Japan (45.000 ha)
- United States (23.133 ha)
- Taiwan (9.314 ha)
- Brazil (8.500 ha)
- Netherlands (8.500 ha)
- Mexico (8.416 ha)
- And others.
Diversification of Products and Market Expansion
The whole trade of flowers and ornamental plants are mainly concentrated in the European Union, the United States and Japan, which consumes almost the entire production of flowers of the world. But that doesn’t exclude new countries to participate in this sector, especially the ones that offers different products.
Even though roses, carnations, and lilies represent 70% of the world consumption of flowers, the tropical flowers are conquering the consumer’s taste and gaining market space for the countries responsible for their production in a global scale.
The international market is in expansion, highlighting new important exporters such as Italy, Israel, Belgium, Canada, Kenya, and Germany. Latin America, Colombia, Ecuador, and Costa Rica are configured as larger exporters, while China and Asia will constitute the potential consumer market for flowers in the future.
The Brazilian Market
According to Ibraflor - Brazilian Institute of Floriculture -, professionalization and commercial dynamism of the flower industry are relatively recent phenomena in Brazil. However, the activity already accounts for extremely significant numbers in the export business, conquering demanding markets such as the Netherlands, United States, France, Canada, England, United Arab Emirates, Argentina, and Uruguay.
Exports and Imports
Brazil sells out products mainly focused on vegetative propagation, such as seedlings and ornamental plants, bulbs, tubers, rhizomes and cut flowers. There was an increase of 47.41% from 2011 to 2012 in the group of foliage, leaves, and dry branches - representing 6.71% of international sales.
The main buyers of Brazilian plants are Italy, followed by the United States, the Netherlands, Japan, Belgium and Canada. The countries that import from Brazil are the Netherlands, Thailand, Japan, and the United States, from which the country also buys bulbs, rhizomes, tubers, cuttings, and cut flowers that are not produced in the country.
The Brazilian Internal Scenario
According to Ibraflor, Brazil has 7,600 flower and plant producers, responsible for the cultivation of over 350 species with about three thousand varieties. The sector accounts for 194,000 direct jobs, of which:
- 96,000 ( 49.5 % ) in production
- 77,000 ( 39.7 % ) in retail
- 6,000 ( 3.1% ) in the distribution
- and 15,000 ( 7 7 ) in other functions.
Production Concentration versus Decentralization
The flower production is mainly developed in small farms in the State of São Paulo. The national average of cultivated area is 3.5 hectares. There are important regional differences. The state of Goiás, for example, has an average area of cultivation of 6.3 hectares, the largest in the country. This explains the state's vocation towards the production of seedlings of ornamental plants in the more demanding physical dimensions of the area.
Although concentrated in the state of São Paulo, in the regions and the municipalities of Atibaia and Holambra, the floriculture shows strong trends of production and trade decentralization for various regions throughout the country. Currently, Brazil is witnessing a remarkable growth and consolidation of major floriculture poles in Rio Grande do Sul, Paraná, Santa Catarina, Minas Gerais, Rio de Janeiro, Goiás, Federal District, and in most states of the North and Northeast.
Flower Commercialization in Brazil
According to the industry statistics, the segment of flowers has grown 8% to 12% per year in sales, and 15% to 17% in the value moved, but Brazil still has a lot to be explored, while the annual per capita consumption of flowers in Europe is 141.00 BRL, the consumption in the country is only 23.00 BRL per year.
The sale of flowers and plants in Brazil has registered a growth of between 12% and 15% per year, well above the average of the national economy. From the total moved by the sector, 50% corresponds to the segment of gardening, driven by construction and investment in the host cities of the 2014 World Cup.
The retail distribution of flowers and ornamental plants in Brazil has nearly 18,000 outlets. The products are usually sold in large wholesale centers (Ceasas), being the Ceasa of São Paulo, Ceasa of Campinas Campinas, and Veiling Holambra Cooperative the largest centers of commercialization in the country.
Ceasa versus Veiling Holambra
The Ceasas use the older system of traditional marketing, where producers are next to each other, offering its products to customers. This system is known as selling "in stone". Spaces are 20-50 m2 each, where the products are exposed to weather conditions. The producers serve not only the wholesale establishments, but also the end consumers.
The system of sales via auctions, widespread in the Netherlands, occurs in Veiling Holambra Cooperative, accounting for 25% of the national trade of flowers and plants. To maintain quality, the system allows the existence of fair prices and the selling of large quantities of product for a short time. The computerized system of auctions enables transparency in commercial transactions and serves as a price reference for the entire national market.