News 24 March 2020

STATEMENT: Situation of the ornamental sector – COVID-19 crisis

The ornamental sector (cut flowers and ornamental plants, trees and bulbs) is undoubtedly the agriculture sector impacted the most by the exceptional crisis derived from COVID-19, suffering since mid-March a dramatic and direct collapse of demand and consumption in most EU Member States and at international level with the large-range closure of all shops, drop out of sales channels and distribution disruption. The ‘domino’ effect that has ensued in the past 2 weeks on the overall supply-chain is bringing the whole sector to the brink of a total collapse across the EU and beyond, with immense ramifications in terms of bankruptcy of businesses and related employment across the supply-chain (production, wholesale, trade, distribution channels and retail shops).  This crisis could not have come at a worst time of the year as Spring (March to May) is the period when most of the turnover is being realised within the sector. These highly perishable and seasonal products rely on a natural plant cycle that cannot be interrupted during the ongoing crisis; this is now triggering the inevitable destruction of production and stocks to a massive scale across the EU and beyond.

We herewith call on the European Commission and all EU Member States to give a special attention to this sector and help identify and activate support mechanisms to:

  •  Help growers and all companies from the ornamental sector to face the immediate consequences of the ongoing COVID-19 crisis in the form of emergency financial crisis support (financial mechanisms to support and compensate growers and supply-chain for the dramatic loss in income, stocks and economic activity and face the pressure on liquidity);
  •  Help find ways to support the overall supply-chain and existing market structures (wholesale, trade and distribution) in the mid to longer-term to secure a (minimum) viability and re-start of the ornamental sector across the EU and beyond after the COVID-19 crisis.

 

The viability and survival of the complete ornamental sector in the EU and beyond, and all related jobs and businesses, is now at stake. This sector has never benefited from any kind of support from the CAP and has always functioned as a purely market-driven sector under the most competitive terms. Its socio-economic contribution in the EU and at international level is immense. Ornamental products also positively contribute to the quality of life and a healthy lifestyle for EU citizens, including mental health, and to the social coherence across generations. Their immense potential in being part of the solution for the overall EU Green Deal ambitions by greening cities and offsetting the effects of climate change at various levels are outstanding and should not be ignored by the European Commission and all EU Member States.

Key figures about the ornamental sector in the EU:

  • The EU is traditionally a large producer, trader and consumer of flowers and ornamental plants: total production value across the EU amounts to 20 billion EUR (approximately 44% of the total world flower and pot plant production with the highest density per hectare) and the sector generate 335 000 FTE jobs in production and 427 000 FTE in wholesale and retail trade (762 000 FTE in total).
  • Consumption value in the EU amounts up to 48 billion EUR (which is more than for example the total EU organic agricultural sector)
  • The sector has always operated without any support from the CAP and is therefore purely market-driven and extremely competitive.
  • The supply-chain is very globalised, interdependent and integrated and markets function along very dynamic flows on a worldwide scale, where the EU plays a major role. Well-managed and efficient just-on-time logistics are also key elements for the growth and competitiveness of the sector.
  • The EU trade balance has been consistently positive since 2002 both in volume and value terms. Developing countries in Africa (Kenya, Ethiopia) and South America (Colombia, Ecuador) have become essential key players in the cut flower supply-chain in direct inter-dependence with the EU supply-chain and with immense ramifications in terms of socio-economic benefits and employment in these countries.
  • Consumption of ornamental products produced within the EU is for 85% within the EU internal market.
  • The most important EU production countries are:
  1. Netherlands
  2. Italy
  3. Germany
  4. France
  5. Spain

 

Production Trade & Wholesale Retail TOTAL
Turnover 18 bn € 30 bn € 48 bn € 48 bn €
Area 210.000 ha
Employment (FTE) 335.000 95.000 332.000 762.000

 

 Inputs collected across Europe  in close cooperation between Union Fleurs (International Flower Trade Association), VBN (the Association of Dutch Flower Auctions) and the Working party Flowers & Plants of COPA-COGECA