Cut flowers, such as tulips, lilies, pansies, and roses, are the 332nd most traded product in the world. During 2016, it is estimated that almost US$9.4 billion worth of cut flowers was exported worldwide, while another US$9.39 billion was imported globally. That same year, the world’s largest exporter of cut flowers was the Netherlands, representing 47% or US$4.4 billion worth of global exports. Following the Netherlands, the world’s largest exporters of cut flowers during 2016 were Colombia, totaling 15% or US$1.4 billion of global exports, and Ecuador, accounting for 9.4% or US$883 million. Other major exporters of cut flowers are Kenya, Ethiopia, and Belgium. Meanwhile, on a continental level, Europe is clearly the largest exporter of cut flowers in the world, representing a staggering 56% or US$5.2 billion of global exports in 2016.
International Flower Trade and US Demand
In terms of imports, Europe is also by far the largest purchaser of cut flowers. During 2016, Europe accounted for 70% or US$6.6 billion of global imports. Within Europe, the largest importers of cut flowers is Germany, totaling 15% or US$1.4 billion worth of global imports. Following Germany, the second largest European importer of cut flowers is the Netherlands, with 11% or US$992 million of global imports. However, as with exports, the official amount imports into the Netherlands can be skewed due to the country’s role as Europe’s commercial gateway, this dynamic is known as the Rotterdam-Antwerp Effect. Other majors European importers are the United Kingdom, France, Russia, Belgium, and Italy. However, on a national basis, the United States is the largest importer of cut flowers, accounting for 18% or US$1.73 billion worth of global imports during 2016.
In the case of the United States, a major consumer of cut flowers, the bulk of its foreign supply comes from Colombia. During 2016, Colombia provided 59% or US$1 billion of the cut flower imports into the United States, a commercial relationship facilitated by the standing Free Trade Agreement (FTA) between the two countries. During 2016, the United States imported a total of US$14.4 billion worth of goods from Colombia. That year, the main Colombian import into the United States was crude petroleum, which represented 42% or US$6 billion of Colombia’s import into the US market. Other major exports from Colombia into the United States were gold, totaling 12% or US$1.74 billion; coffee, accounting for 7.4% or US$1.1 billion; and the before mentioned cut flowers, representing 7.1% of all US imports from Colombia.
With the ongoing increase of oil prices, which is currently trading at approximately US$70 per barrel, is also strengthening the Colombian Peso (COP). After the upcoming presidential election in Colombia, a strengthened Peso is expected to boost the purchasing power of the national market, thus boosting imports, as well as increase the value of investments in-country. Currently, international investors should take advantage of the favorable exchange rate window to enter the Colombian agribusiness sector, before the Peso stabilizes at a lower exchange rate that is closer to its long-term average.