Start of 2017: lower supply and higher prices03 February 2017
The first period of the new year has already gone. We concluded this with a drop in revenue of about 3%. The supply was lower than at the start of last year.
The drop in revenue in period 1 of 2017 was due to a lower supply of products: around 9% less than last year. There are several causes of this:
- Fewer roses from Africa because of cold weather.
- The auction was closed for two days at the turn of the year, but for four days the previous year. This meant that four days' worth of production was sold in the first week of 2016.
- It was really terrible winter weather in middle and southern Europe, resulting in a lower demand than the year before. Cut flowers showed the biggest drop in supply, especially the roses and tulips.
Price level rose 6%
Due to the lower supply, the average price level rose 6%. That compensated for much of the change in revenue.
The revenue ended 3% down in period 1 of 2017, with the same number of auction days as in 2016
Further increase in direct trade
Among cut flowers, the share rose by 2.2%-points to 35.9%. The products that were already often being sold via direct trade increased more than the other products. Over the entire range, the share of direct trade increased further. Among houseplants, the share rose by 2.7%-points to 78.3%. Clearly, the limit to this growth has not yet been reached. The bulb-in-pot products sold relatively less via direct trade. Among garden plants, the share of direct trade increased by 6.1%. Garden plants are busy catching up and are following the trend of the houseplants.
Export rose in 2016 by 3%
The export figures from Floridata for all of 2016 have now been published. The export of flowers and plants grew by 3% in 2016. Plant exports rose by around 4% and flower exports by around 2%. Germany continues to be the most important sales market and improved its position in 2016. Almost 29% of our products go to Germany. The export to most countries increased.
The UK and Russia lag in growth
The total revenue in the UK dropped by almost 5%. Prior to Brexit the UK showed signs of a slight growth. After Brexit the export dropped on average by 10%. The export to Russia sank by 30%. According to the figures from Floridata, there seems to be no end in sight: no balance is evident yet in Russia.
Source: Floridata and Royal FloraHolland
The growth in Dutch exports and the growth in revenue at Royal FloraHolland follow each other closely. Both showed a growth of around 3%.
Cut flowers declined by 2.8%
The revenue for cut flowers declined by 2.8%. The supply dropped by 9%, and the average price rose by 7%. Supplies of tulips and roses in particular were lower, while many more Eustoma were supplied. The price-setting for tulips and roses was better than last year, Eustoma lagged in price.
Houseplants drop by 4.8%
The average price of houseplants rose by 2.4% and the supply shrank by 7% compared to the year before. Kalanchoë stood out with 11% more supplied, while the average price dropped by 9%. And 9% fewer Phalaenopsis were sold, while the price remained about the same.
Garden plants rose by 4%
Sales of garden plants declined by 20%. The average price level rose by 30%. The sales of primulas were greatly reduced: the number of items dropped by 20%. This led to an increase in interest in other products, for example Helleborus. As a result, the average price increased, while the price level remained about the same.
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