Trade sales 1 percent lower in period 3 of 201606 April 2016
The sales in period 3 of 2016 were 1% less compared to last year. As there were the same number of auction days, this result was unexpected.
It seemed logical to expect more sales than in 2015 because this year some of the sales for the English Mother's Day and International Women's Day fell in period 3 (a period consists of four weeks), as did Easter. In addition, the export to the UK increased greatly.
Cause of depressed sales
The supply is not the reason for the decrease in sales: it was
approx. 2% higher than last year. But the average price was about
3% less compared with 2015. This was primarily due to a lower price
for cut flowers. The top 3 in particular, roses, tulips and
chrysanthemums, were priced lower.
Royal FloraHolland revenue development per period:
In cumulative terms, the revenue growth is currently 8%. Taking into account the extra auction days in period 1 (the first four weeks of January 2016), this results in a cumulative revenue growth of about 1%.
The question is what will happen to sales in the coming weeks. Last year the weeks between the English Mother's Day and Easter were highly profitable. The bridging between Easter and the Dutch Mother's Day is now 6 weeks, which may exert downward pressure on the price-setting.
The proportion of sales of cut flowers through direct flows stabilised in period 3. It remained relatively unchanged: 37.5%. The most commonly sold flowers via direct flows are still gerberas, lilies and tulips. Hypericum and Zantedeschia still bring up the rear in terms of sales.
Among houseplants, we see a rise in sales via direct flows of 2.5 percentage points to 76.1%. The leader in this group is still Phalaenopsis. Only azaleas fell behind, with just 52% of sales via direct flows. Among garden plants, the sales via direct flows rose slightly, by 0.8 percentage point, to 66.4%.
The most recent export figures are from February 2016. In that month the export of flowers and plants increased by 5.5% while the revenue at Royal FloraHolland grew by 8.5%. In cumulative terms, exports grew by 1%.
The export trends of the past few months persisted. Russia continued to perform poorly, with a drop in export of 25%. Exports to the UK continued to develop positively, with growth of 21%. Exports to Germany grew in February by 4%, thanks to the transit of cut flowers, because the export of plants to Germany dropped by 12%. In addition, the growth of exports to the USA was striking, with a 13% rise in cut flowers.
Sales of cut flowers dropped by about 2%. The supply increased by 3%, but the average price fell by 5%. The price-setting for roses and tulips experienced the greatest pressure, with a drop in price of almost 10%. But even spray chrysanthemums and lilies showed a decrease of around 3%. This explains most of the drop in price of 5%.
Sales of houseplants rose by 2%. The supply decreased by 3%, and the average price rose by 5%. Narcissus did not realise the price it commanded last year, and showed a 12% drop in price. Most of the other products sold at a higher price. Phalaenopsis rose 5% in price, with a 7% decrease in supply.
Sales of garden plants declined by almost 4%. The supply was 7% lower, the average price rose by 5%. The supply of garden plants increased greatly in the first two months of the year, and has now returned to its usual level. The supply of summer-flowering plants is already growing strongly, although the weather (night frost) is not always favourable.
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