PETAL TO THE METAL

Ecuador 2013 | AGRICULTURE | FOCUS: FLOWERS

Ecuador's floriculture sector is relatively young compared to the likes of the Netherlands, yet still it is showing that it has the quality of product to be one of the market leaders.

Over the past 30 years, Ecuador's floriculture industry has gone from relative international obscurity to one of the leading exporters in the world. Ecuador is now known for its roses, and has over 550 farms across the country directly employing 50,000 people and indirectly responsible for 110,000. This makes the floriculture sector the fourth largest in the country after oil, seafood, and bananas. Although the sector is not as large as the leading South American exporter, Colombia, Ecuador is the leading rose producer, and well known for large headed roses due to its high altitude.

One of the main reasons behind Colombia's successin the international floriculture market has been its high quality flowers and its free trade agreements (FTAs), especially the one with the US. The US imports 82% of all its flowers sold on the domestic market, with $149 million worth of cut-flower roses in 2011 coming from Ecuador compared to the $646 million from Colombia. The US imports 78% of all its flowers from Colombia and only 15% from Ecuador. A barrier that Ecuador still faces is the tariffs that the US imposes on its roses, a market that is estimated to be worth $250 million a year in 2013. However, the US is not the only country that Ecuador exports to. “Around 10% of our clients are supermarkets in Europe and the US, and individual importers from 30 different countries buy something around 85% of our production. Ecuador exports to 150 different markets, which means that we still have 110 different markets we can expand our activities to," said Roberto Nevado, President of Nevado Roses, explaining the options available for the sector to TBY. Another positive aspect to look forward to for the Ecuadorean market is the development of the national airport infrastructure. A prime example of these developments is the new airport being built in Quito, which will allow more international flights at an increased capacity. New direct flights will open up, which has been proven to increase international trade. For example, even though Spain is undergoing economic difficulty, it is still Ecuador's third most important market when it comes to flowers, and this is largely due to the direct air connection between the two countries. Nevado expressed his confidence in the Ecuador floriculture sector by saying, “We have a unique product that will always conquer markets, regardless of the market." Ecuador has quite unique conditions when it comes to flower production that not many countries can copy; therefore, once the flowers get onto the market they tend to do very well. Evidenced by the fact that since Ecuador began industrially producing roses back in the early 1990s, the market has experienced growth every year and become a world leader in terms of quality. Since the beginning, farms have invested over $1 billion altogether into the rose sector to make it what it is today.

The floriculture sector in Ecuador has shown remarkable growth over the 30 years it has been industrially producing flowers; however, there is still a long way to go if it wants to produce flowers on the scale of Colombia, or even the Netherlands. Nevado described the main problem with the market at the moment as the lack of proper and competitive financing from the banks to allow the expansion of companies and investment required to boost growth levels.