What`s New for 2022?

» Global competitiveness and key competitor percentage market shares
» Market presence across multiple geographies - Strong/Active/Niche/Trivial
» Online interactive peer-to-peer collaborative bespoke updates
» Access to our digital archives and MarketGlass Research Platform
» Complimentary updates for one year

A $40.7 Billion Global Opportunity for Cut Flowers by 2026

Amid the COVID-19 crisis, the global market for Cut Flowers estimated at US$33.2 Billion in the year 2022, is projected to reach a revised size of US$40.7 Billion by 2026, growing at a CAGR of 4.8% over the analysis period. Rose, one of the segments analyzed in the report, is projected to grow at a 5.4% CAGR, while growth in the Chrysanthemum & Gerbera segment is readjusted to a revised 4.8% CAGR. The coronavirus outbreak has presented challenges for the flower trade globally, with the industry being hit hard by the travel curbs, quarantines, social distancing measures and lockdowns. COVID-19 put a pause on all activities like home stagings, photo shoots, and decorator shows where flowers were widely used, leading to a steep fall in demand for flowers. The floral industry`s worldwide supply chain that encompasses florists placing wholesale orders to the largest Dutch flower auction houses in the world came to a virtual halt during the early months of the pandemic. The Netherlands-based floral auction houses through which nearly 40% of the global flower production pass, have also been affected by the pandemic. A leading auctioneer, Royal FloraHolland that managed 4 large auction sites recording over 100,000 transactions daily, witnessed its activities grind to a complete halt with the pandemic`s outbreak. With rose prices reaching all-time low, the auction house was forced to destroy early 70% of its supplies at its facility in Naaldwijk causing huge losses. The floral market`s collapse has also created problems for cultivation sources. Leading rose producers such as the Kenya-based Nini Flowers faced dipping sales due to fixed costs of cultivation, resulting in destruction of cultivated flowers. American farmers were forced to dump their crops before they perished. Further, large scale unemployment resulted in several flower farms.

COVID-19 pandemic impacted businesses at various levels of the supply chain, from tulip auctions in the Netherlands, to lily growers in Colombia. The pandemic also has taken a toll on Kenya, which is the third biggest cut flowers exporter globally. Growers selling their produce abroad had to face additional challenges due to border closures, flight cancellations, port lockdowns and such other logistical issues. The pandemic led to several countries closing down their borders while in others, extended formalities that included screening for COVID-19 led to delays in transportation times. Additional costs had to be borne by floriculture traders. Cut flowers are generally transported in passenger jets. In Europe, majority cut roses come from Ethiopia and Kenya. Flower industry in East Africa collapsed due to decline and air freight restrictions in major markets. The fast-spreading pandemic also led to major declines in prices of cut flowers that are globally traded. Companies that supplied cut flowers were more severely impacted compared to those that offered trees, indoor plants, shrubs or hedges.

Beyond the many challenges, post pandemic growth in the market will be led by changing lifestyles, more emphasis on style and quality. Cut flowers industry is expected to benefit from the growing demand for specialty cut flowers. Organic cut flowers market is expected to take some of the thunder of chemically produced cut flowers market over the coming years, as the demand is increasing for natural products that are free from pesticides and chemicals. Traditionally flowers have been sold through specialist retailers such as florists as well as kiosks at places with high footfalls as flower purchases are usually conducted on the go. However, e-commerce is changing the rules of the game with innovative solutions in terms of service as well as designs. Buying flowers online, users are provided with a wider range of designs to choose from, and personalize. Moreover, users can send flowers from the comfort of their homes to any place in the world. Though the penetration of e-commerce is relatively low, the trend is picking up and the COVID-19 pandemic has provided a fillip to the segment, given the fears of going out. Moreover, in contrast to other retail markets, the middle aged and above demographic segments are among the largest users of e-commerce platforms when shopping for flowers. Given the comforts and wider choice provided by online platforms, e-commerce channels of are expected to offer the highest growth prospects.

Western Europe, Japan and North America are the world`s leading cut flower consumers. In the countries such as Japan, the United States, India, and China the local growers satisfy most of the demand for cut flowers. Carnations and roses are the major growing and selling cut flowers worldwide. Lilies and tulips also account for a major market share of the total world cut flower production, imports and consumption of cut flowers. Established flower growing countries face intense competition from various new countries entering into the cut flowers market. The major competition is between the flower producers of the tropical regions where the cost of production is low and growers and exporters of the foremost flower consuming nations where the costs of production are very high. Cut flower exporters from developing nations are gaining market share at the expense of existing market players from developed nations. The leading flower growers are trying to regain the market share by increasing the production and quality of the flowers and through innovation and diversification. The significance of local production is decreasing whereas world cut flowers imports are rising. Competition in the global cut flower industry is expected to become more severe, intercontinental and concentrated. Rapid innovations provide a potential opportunity for high-cost producers. Improved quality and growth in production also offer opportunities to market players across the globe. Small firms are likely to form strategic alliances and consolidations with larger companies in order to survive in the highly competitive and perishable cut flowers market. The market is expected to attract many new entrants despite the constraints such as huge capital requirement, high costs of production, high technical knowledge and high costs of labor in most parts of the world.