Floriculture and Nursery Crops Yearbook
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Electronic Outlook Report from the Economic Research Service United States Department www.ers.usda.gov of Agriculture FLO-2006 Floriculture and Nursery June 2006 Crops Yearbook Andy Jerardo Abstract Despite higher energy and fuel costs in 2005, sales of floriculture crops managed a 1.5- percent increase as the U.S. economy expanded at a healthy pace. All floriculture crop groups boosted sales, except cut flowers as competition from imports continues to rise. Even as the number of growers declined for the fourth year in a row, average floriculture sales per grower and per acre of total production area rose for the third consecutive year. Keywords: Floriculture, nursery, greenhouse, horticulture, cut flowers, flowering plants, foliage plants, bedding and garden plants, annuals, perennials, ornamental crops, trees, shrubs. Floriculture and Nursery Crops Yearbook. Market and Trade Economics Division, Economic Research Service, U.S. Department of Agriculture, June 2006, FLO-2006. Contents Summary …………………………………………………………………. iii Compilation of Sales and Trade Data…………………………………… 1 Definitions.………………………………………………………………… 3 List of Tables……………………………………………………………… 5 Report Coordinator Andy Jerardo (202) 694-5266 E-mail: [email protected] Principal Contributor Andy Jerardo Editor Martha Evans (202) 694-5118 Table Design & Layout Mae Dean Johnson (202) 694-5245 Approved by the World Agricultural Outlook Board. Summary released June 23, 2006. Floriculture and Nursery Crops Yearbook may be accessed electronically via the ERS website at www.ers.usda.gov. ii Floriculture and Nursery Crops Yearbook/FLO-2006/June 2006 Economic Research Service, USDA Summary Positive Growth for Floriculture Sales in 2005 Floriculture crop sales increased by a modest 1.5 percent to $5.4 billion in 2005. All floriculture crop groups expanded in sales, except cut flowers. Grower sales of cut flowers declined for the third year in a row, as cut flower imports grew for the third consecutive year. And as imports of other floriculture crops continued their upward trend, domestic consumption reached $6.2 billion in 2005. This translates to an average $56 of floriculture crops sold at wholesale to each U.S. household. The share of imports in floriculture consumption remains at 14.1 percent, which is lower than the 16.2 percent a decade ago. The fastest growing crop group was potted foliage plants for indoor or patio use, increasing over 5 percent in 2005 and has averaged 5 percent since 2003. Herbaceous perennial plants and propagative material also grew more than 5 percent on average in the past 3 years. Quantity sold of domestic-grown floriculture crops was higher for bedding and garden plants in 2005, but lower for potted flowering plants and cut flowers. Unit prices increased 2 percent for potted flowering plants, 1.3 percent for herbaceous perennials, and less than 1 percent for annual bedding plants. Prices of cut flowers fell 2 percent, and are only marginally higher than prices in 2000. The total number of U.S. floriculture crop growers (in the 36 surveyed States) declined for the third consecutive year. The number of large growers with annual floriculture sales of $100,000 or more were 4,412 in 2005, the fewest since the survey of 36 major States began in 1992. Sales per large grower exceeded $1.15 million on average in 2005, almost twice the revenue in 1992. California still leads the industry in floriculture sales with $1 billion, followed closely by Florida with $976 million in 2005. However, the number of growers in Florida was 907, more than California’s 820 in 2005. Average sales of large U.S. growers of floriculture crops expanded in 2005, including growers of cut flowers. The crop group with the highest average sales was bedding and garden plants at $859,614 per grower, followed closely by cut flower growers at $796,572. The average size of large operations in the Western and Southern States--$1.6 and $1.4 million in 2005 sales, respectively—are twice those in the Midwest and Northeast. All large floriculture operations in the 36 surveyed States hired more than 127,000 workers in 2005, down 2.5 percent from 130,320 in 2004. Average sales per hired worker approached $45,000 for large growers in 2005, up more than $10,000 since 1999. Floriculture Production Area Edge Down 1 Percent As the production area of small floriculture growers continues to shrink, the production area of large growers continues to expand. The greenhouse-covered area of large floriculture operations increased to 11,119 acres in 2005 from 10,990 acres in 2004. Since their open-field production area also rose, the total growing area of larger growers in the 36 surveyed States reached a record 53,344 acres in 2005. Of total area, 21 percent was under greenhouse cover and 14 percent was under shade or temporary cover. Average sales per acre of large growers were $95,300 in 2005, and $31,000 for small growers. The average production area of iii Floriculture and Nursery Crops Yearbook/FLO-2006/June 2006 Economic Research Service, USDA large growers was more than 12 acres in 2005, another record. Of this area, 4.3 acres were covered and 7.8 acres were open-field on average. Large growers in Florida had the largest floriculture area of the 36 States with 15,900 acres in 2005, of which 1,487 acres were under permanent greenhouses. California had 10,500 acres in production, of which 2,138 acres were under greenhouses. Average sales per acre were highest in Maryland, however, at more than $325,700 in 2005. The next highest were large growers in Colorado with $307,000 per acre on average. Despite average sales that are half those in the West and South, large floriculture operations in the Northeast States had the highest average sales per acre of the four U.S. regions at $108,000, followed by Midwest States at $105,776 per acre. Higher sales per acre in the Northeast and the Midwest are attributed to the larger share of production area under greenhouses—27 and 30 percent, respectively—compared to 17 and 20 percent in the South and West. Cut Flowers Fresh cut flower sales dropped 4 percent to $396.7 million in 2005, the lowest level since 1986. Except for gerbera daisies, lilies, tulips, and carnations, all other major cut flowers experienced lower sales. Nevertheless, sales of leatherleaf ferns were up in 2005. Among the major cut flowers still grown in the U.S., roses remain the highest earners with an average $660,271 of sales per large grower. The second highest earners are lilies at $541,387 sales per grower. Gerbera daisies come in third with $529,738 sales per grower on average in 2005. While most major cut flowers grown in the U.S. have suffered declining sales since 1992 (start of survey of 36 States), average annual sales of cut flower growers have been rising steadily. From $492,000 per grower in 1992, average cut flower sales reached close to $797,000 in 2005. As cheaper imports have discouraged domestic cut flower production over the past 2 decades, the number of U.S. growers has fallen. Nevertheless, these fewer growers focused their production on high-value cut flowers, and produced less where import competition is strongest. As a result, despite declining total annual sales, cut flower sales per grower have continued their upward trend. California leads the country with 73 percent of total cut flower sales in 2005. The State of Washington comes in a far second with 5 percent and then Hawaii and Florida with 4 percent each. Almost two-thirds of the more than $1 billion in domestic sales of cut flowers were from imports in 2005, the highest share on record. The U.S. imported more than $709 million of cut flowers in 2005, another record amount. About $9.75 on average were spent by each U.S. household for cut flowers in 2005, down from $9.92 in 2004 and $10.20 in 1997. Of imported cut flowers, roses were by far the largest in value at $274.7 million in 2005, or nearly 40 percent of total cut flower imports. The most expensive imports are cut anthuriums and cut orchids at an average 84 cents per stem in 2005. Almost 88 percent of U.S. consumption of fresh cut roses were imported in 2005, the highest level ever. Similarly, import shares were high for carnations at 95 percent, chrysanthemums at 76 percent, alstroemeria at 95 percent, and orchids at 53 percent of consumption. Consequently, U.S. growers reduced their production of most cut iv Floriculture and Nursery Crops Yearbook/FLO-2006/June 2006 Economic Research Service, USDA flower varieties except orchids, gerbera daisies, irises, lilies, and tulips. These high- value flowers have been U.S. growers’ answer to fierce competition from imports. Potted Flowering and Foliage Plants Sales of flowering plants in pots climbed 1 percent in 2005 to almost $809 million. Potted foliage plants expanded 7 percent in sales to $652.1 million, but foliage hanging baskets dropped 10 percent in sales to $68.9 million. Potted flowering plant sales’ gains in 2005 are attributed largely to orchids, which closed in on $144 million in sales, up from $129 million in 2004. Orchids are the fastest-growing potted flowering plant, more than tripling sales of $47 million a decade ago. While poinsettias remain the biggest seller at $242.3 million in 2005, sales are down 2 percent from 2004 and fell farther below their peak of $255.3 million in 2001. Imports of poinsettias, largely shipped from Canada, were more than $6 million in 2005, but are down from $10.4 million in 2002.