Growth in Dutch, German flower and plant exports

Until the end of September, the export value of flowers and plants from the Netherlands has climbed 6% to almost € 4.7 billion. Trends like a stronger spread over more countries, faster growth in flowers and the sharp increase to Germany, are continuing. This is determined by VGB and Floridata based on export statistics. The past quarter was the 14th in a series with a positive conclusion. Exporters note that international competition is increasing. "The Netherlands can maintain the global strong position by permanently investing in ICT, the availability of a broad assortment and logistic efficiency," according to Floridata and VGB.

 

September, with an increase of 4%, was slightly behind the average growth of rounded up 6% this year. The quarterly turnover, compared to the third quarter of 2016, ended 2.6% higher, with more than € 1.2 billion. The effects of the recently announced increase in the low VAT rate on domestic sales of flowers and plants are difficult to estimate. In the European context, exports may possibly include another taxation system, which the VGB, together with other organizations monitors closely. 

In September, both the flowers and plants value rose by more than 4% to € 280 million and € 168 million respectively. The cumulative lead of the flowers thus is maintained: plus 7% for the cut flowers and plus 4% for the pot and garden plants. Last year, the plants value rose faster than that of the flowers and in 2015 again the flowers climbed more. "It is characteristic of Dutch wholesale, that concepts are developed for both segments that widen the market," said VGB director Matthijs Mesken.

 

The stronger spread and internationalization will continue. Wesley van den Berg of Floridata notices more applications for debtor information from relatively new and developing sales countries. "This trend is strengthening. With our information about potential customers, we are supporting the exporting wholesale sector more and more intensively."

Until and including September 2014, the sales share of the top 10 customers was 83.5% and the other countries amounted to 16.5%. After September this year, the share of the other countries has climbed to 19.5%: an increase of three percentage points or 18%. "Economic developments are positive throughout the world. As a result, interest in luxury products increases, and the Dutch flower industry goes along with it, "says general manager Cees Bakker of Anton Spaargaren. "We offer a wide assortment and a good availability, we can deliver fast and we are knowledgeable. And the Dutch pioneer spirit also helps." Sales manager Marck Limmen of Barendsen recognizes growth in further destinations. "From the Netherlands, we have better organized logistics in, for example, Asian sales countries and countries of origin." Bakker and Limmen also point to the worldwide present local production. "Partly because of this, international competition is growing," Bakker expects. "Even more intensive use of ICT can strengthen the Dutch wholesale position," says Mesken.

 

Large buyer Germany, up till end of September, good for one third of the Dutch export value in flowers and plants, shows an increase of € 66 million for 27% of the total growth. "The German economy is doing well and there is a lot of confidence. Besides, the weather conditions for the sale of flowers and plants have almost always been good this year," Erik Jaap Kroone van Nijssen Jr. explains about the growing sales. England (-6%) and Sweden (-1%) are the only countries in the top 10 export destinations with a shrinkage. Russia (+ 37%) remains growing the strongest.

In period 10, from 11 September to 6 October 2017, the picture was dominated primarily by the cut flowers. There was clearly more demand for cut flowers than in previous years, leading to an increase in the average price of flowers.

Period 10 is generally a quiet period for the sales of flowers and plants. There are few specific holidays to stimulate the consumption of flowers. Grandparents' day at the beginning of October is still too new but may produce a stimulus in the future. On the other hand, there are many weddings in this period. Ultimately, the period concluded with a growth of 2.4%. The cumulative growth in turnover from January 1 amounts to 1.4%.

The shift of sales from the clock to direct flows continues at a steady rate. It is striking that the increase is stronger with plants, where the share of direct flows is already high, than with cut flowers. For cut flowers the share of direct flows increased by 1%-point to 31.2%.

For houseplants the share of direct flows increased by 2.4%-point to 79.2%. For outdoor plants the share increased by 5.2%-point to 64.3%. If we look at the product level, for cut flowers the same products like Gerbera and lily are responsible for more than 50% of sales via the direct flows. For products like roses and chrysanthemums, the share of direct flows is 1/3 of the total turnover.

The export figures from Floridata for August are the most recent ones published. In August the export grew by 2%, and in cumulative terms, the growth of export is almost 6%. The cut flowers did better in August than the plants. On the national level, it was primarily the Eastern European countries that did well. The export to the UK remains under pressure; in August, the export decreased by 4%. The export to the USA also came under pressure in August with a drop of 15%. The growth in export and the growth of Royal FloraHolland are at the same level because the plant turnover at Royal FloraHolland is expanding more strongly than the export.

For cut flowers the turnover increased by 3%. The supply declined slightly, by 2%, and the average price level rose by 5%. This allowed the lilies, hortensia and freesia to realise a clearly higher average price than last year, while spray chrysanthemum and gerbera traded below the average of last year.

For houseplants the turnover remained practically unchanged. The supply and the average price level turned out also to be basically unchanged. At the product level there were differences from last year. The supply of Phalaenopsis and pot roses was clearly lower than last year, with better price-setting, while the supply of Kalanchoe and Anthurium was considerably greater than last year, but with no change in the price-setting.

For outdoor plants the turnover was 6% higher than last year. The supply remained basically unchanged, while the average price rose by 6%. The violets and the Ericas were mostly responsible for this positive push.

Veiling Rhein-Maas is satisfied about the third quarter of 2017. As a whole, quarterly sales rose by 2.6% compared with the same period last year. "We are particularly pleased that we could achieve the same positive result as last year," according to Marc Schax, director of Veiling Rhein-Maas. "In particular, the month of August was an excellent month from the sales perspective."

In particular, the sales channels clock pre-sale and sales service were once again pleased with a constantly increasing popularity with the auction customers. In both cut flowers and potted plants, clock pre-sales in the third quarter of 2017 showed a strong increase in numbers and turnover. Up to 500 customers have access to the digital sales channel clock pre-sale. More and more customers log in daily, to view the offer and to reserve products. With a high increase in numbers and turnover, the clock service department once again had an important share in the total Veiling Rhein-Maas result. Turnover through KOA (Buy-At-Distance) of the total turnover of the auction remained constant at approximately 28% in the third quarter. In addition, because of the positive experiences in introducing 'Premium Quality' in potted plants and cut flowers, the qualification ‘Premium Quality’ was also introduced in cut hydrangeas.

To find out how satisfied the leaders are in their entirety with the various sales channels at the auction and what their expectations are in the future of the Straelen-Herongen marketplace, a research was conducted again in June and July 2017, three years after the first leaders study. "In total, 24% of all respondents completed the online questionnaire, which is a positive signal! All suggestions, wishes and improvement proposals will help us further improve the marketplace in Straelen-Herongen," according to Uwe Bedenbecker, director of Veiling Rhein-Maas. "Particularly pleasing is the clear increase in satisfaction of the leaders with Veiling Rhein-Maas in comparison with the leaders study in 2014. The overall satisfaction with the auction increased by 16 percentage points to 77%."

Here you will find more information about the results of the leaders research. (Available in Dutch)