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November 2007


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Flower power

The global floriculture business is booming, but the Netherlands is having to dig deep to safeguard its pre-eminence. Boyd Farrow reports


The biggest threat to Dutch flower power comes from a most unlikely place, however: the desert. July, 2006 saw the opening of the €50m state-bankrolled Dubai Flower Centre, which is capable of handling 180,000 tonnes of perishable goods annually and which has already attracted scores of international shippers and wholesalers. Whereas an established market made Amsterdam a trading hub for foreign flowers, the tax-free emirate aims to triumph by undercutting the costs of shipping to this hub and then back out to retailers. By channelling African and Asian produce through Dubai, which is increasingly well connected to the global markets, time and money can be lopped off the chain linking producers to consumers.

Dubai is certainly poised to exploit the Indian flora export market and has been enthusiastically schmoozing Latin American countries keen to expand their business into the booming flower industries of the Middle East, Asia – Thailand alone grows more than 1,000 species of orchids – and Russia. The latter market has seen a fivefold increase in Dutch imports since 2004. Ecuador is desperate to expand its market base due to a delay in signing the free trade agreement with the US.

Even less likely producers are muscling in. In August, for example, Iran announced that the country’s flower production should double by next March (the current Iranian calendar year started on 21 March), largely due to construction of a new flower export terminal, Mostafavi, in Tehran Province. In the first five months of 2007, over 1.2 billion flower stalks were produced in Iran, 2.5 million of which have been exported to neighbouring states like Tajikistan and Turkmenistan. In a bid to promote Iran’s flower exports, flower producers will soon be sent to the Netherlands, Germany, France and Columbia to learn about packaging and industrial production.

While Iran’s president, Mahmoud Ahmadinejad, is unlikely to exchange bouquets with Israel premier Ehud Olmert any time soon, Israel is the region’s flower-producing superpower. Its flower, plant and propagation-material exports bring upward of $200m into the economy annually. The country is third only to the Netherlands and Kenya in supplying the EU with flowers. Each year 1.5 billion stems are exported, twice as many as only 10 years ago.

Designed initially as a transportation centre, Dubai eventually intends to open a flower auction but is reluctant to discuss a timescale. Bloemenbureau Holland spokesperson Hermine Warringa says: “We don’t know how much business Dubai will take from us – it is too soon to tell.” Quint Wilken, who runs the Dutch operation of German shipping giant Cool Chain Group, says: “If the Dubai Centre is successful as a handling depot, it will be a big blow to the Netherlands. If it also becomes an auction house, that will be a disaster.”

Paul van den Brink, marketing director at Schiphol Area Development Company, reckons that Dubai is only two years from being able to compete with the Netherlands in terms of expertise and suggests that Dutch knowledge is being directly tapped.

So what is the Dutch flora industry doing to safeguard the pre-eminence of a sector that the Netherlands government banks on being worth €7.5bn annually by 2014? Well, for starters, an extra 450 hectares surrounding Schiphol is being developed for perishable goods processing operations that will exploit both air and high-speed rail transport links. “Whether the flowers are grown in Africa or in Europe, distribution to the consumer market is still a key factor,” explains van den Brink. Further afield, Dutch producers and auction houses are investing in production and handling agencies in Africa and Israel, while Latin America is in the pipeline.


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