Temperate and sub-tropical species such as citrus fruit, grapes and pears are imported as well, but mainly in out of the European growing season. Countries in the southern hemisphere are able to supply when the countries in the northern hemisphere can not. This is also known as counter-season supply. For fruit products that can be stored, such as apples, the counter season is less evident. With the continual improvements in storage life and storage conditions of fruit products, the off-season is shortened.

EU countries have a high degree of internal supply for vegetable products. Only occasionally, for instance in cases of poor harvests or during the off-season period, products are imported from outside the EU. Some vegetables can be grown in controlled conditions such as greenhouses (glass or plastic), reducing the risk of a bad harvest and extending the supply period.

The possibilities of exports to the EU are small for products that are highly perishable or delicate such as lettuce and other leafy vegetables. When the harvest in the EU countries is too small and vegetables need to be imported, countries that are located close to the EU have the advantage of short transportation time and lower transport costs.

When analysing EUROSTAT trade statistics, we find that major vegetable products with a high degree of self-sufficiency are lettuce, carrots, cucumbers, cabbages, tomatoes and sweet pepper. Developing countries play an important role in the supply of peas and beans during the off-season. Other important off-season products supplied by developing countries are snow peas (mange-tout), sweet peppers and courgettes.

Source: ProVerde

Often, the wholesale companies have established a special dealing room on their company premises for this purpose. In the comfort of their own offices, anywhere in the world, they can buy online on all the FloraHolland auction clocks. Growers, who supply the products, can see in real-time on the Internet how the buying process is going.

How does KOA work?
On the screen, one clock is always shown as the main clock. This can be used for remote buying. The other clocks are running in the background, so you can switch rapidly from one to the next. Alongside the main clock, you may have a maximum of five supplemental clocks open on the video screen to follow these auctions by lot. These supplemental clocks display the grower’s name, the product, and the pricing structure.

99.9% of supply available at 5 a.m.
KOA buyers may download information on the day’s supply every auction day beginning at 4 a.m. In practice, this means that by 5 a.m. you will already have all the information you need for about 99.9% of the total cut flower, houseplant and garden plant supply for the day.

Source: FloraHolland

At young plant level, the bromeliad market is extremely competitive and is dominated by small number of relatively big breeding companies (Corn. Bak, Deroose Plants, Exoticplant) who compete for market share with a steady stream of new patented varieties. These breeders (or so-called improvers or hybridisers) are working constantly to produce ever more spectacular and hardy varieties for the market. The search for finding new varieties is fuelled by one thing: new stock.

European breeders usually breed, select and propagate their own young plant material. These young plants are sold to domestic growers as well as growers abroad. The companies have switched more and more to in-vitro propagation over the last ten to twenty years.

The competition for finding and being the first to use new superior clones and new species of bromeliads, especially in the genera Guzmania, Vriesea, and Aechmea therefore is fierce. Many superior hybrids have been produced in Europe and are now grown under licensing agreements all over the world. A single patented variety could be worth millions to the patent holder.

In the case of bromeliad young plant material, The Netherlands and Belgium are the biggest producers and exporters. Exports of bromeliad cutting go mainly to Italy, Germany and Denmark, but also outside Europe to USA and the Far East (China, Japan, South Korea).

However, bromeliad cuttings can often be grown faster and cheaper in nurseries abroad than in Europe. Many such facilities exist in Guatemala, Costa Rica, Colombia and, to a lesser extent, in other Latin American countries.

Most commercial laboratories for in-vitro propagation of plants are located in The Netherlands, France, Italy, Germany and Belgium. More and more production facilities in developing countries are used besides those in Europe. Labour costs in developing countries are low and the techniques are available. Usually, a company in a developing country works under licence of the European company.

A trend that can be recognised is the demand for laboratories in developing countries which have experience with specific products and developed ‘protocols’ for these products.

Source: ProVerde

Almost all summer flowers are sold as fillers, mixed with other flowers and greenery in bouquets. Particularly during the European winter months, large quantities of summer flowers like Gypsophila, Hypericum, Ornithogalum, Ranunculus, Solidago and Veronica are imported to complement European supply and to allow for a year-round supply of bouquets. Consequently, the best export window for summer flower exporters in developing countries is during the period October-May.

The two main exporters of summer flowers to the European Union are Kenya and Israel. Besides Kenya, other developing countries playing an important role in supplying summer flowers to the EU market are amongst others Ecuador, Egypt, Ethiopia, and Zimbabwe.

Source: CBI, ProVerde

The role of the Dutch and German auctions in the European tropical flower trade is considerable. Nevertheless, most tropical flowers enter the EU market directly via importers who are either specialised in tropical flowers or who import tropical flowers as a supplement to their assortment of mainly traditional flowers.

Exporters should keep in mind that the EU flower trade is becoming more and more professional. The main criteria for success for a tropical flower exporter is being able to meet the ever-increasing quality requirements.

This market survey covers the EU market and the markets in Germany, UK, France, Italy, Spain and The Netherlands. It provides information on consumption, production & trade (market sizes and trends), trade channels for market entry, prices, market access requirements and business practices & sales promotion.

Source: CBI, ProVerde

At FloraHolland Aalsmeer, the auction has worked in recent years towards the creation of a modern and flexible auction system. Five of the fourteen auction clocks use image auctioning and one clock uses virtual auctioning. Two more clocks will probably change to image auctioning in 2010.

Since 1 October, cut flower purchasers in auction room E/F can also buy at the clocks in auction room A/B. It is therefore now possible to buy at all ten cut flower clocks from one auction centre. Purchasers in auction room E/F and auctioneers are working with modern facilities with many more functionalities, including a new KOA release and a handy technique whereby growers can provide the auction with images.

Via the buyers, KOA (remote buying) sales tools are being deployed in the Netherlands and abroad. These are important developments with respect to purchasing power.

In Naaldwijk, more and more cut flower clocks will be projected on the wall in the coming months. After this expansion of projection auctioning, image auctioning will also be expanded. Naaldwijk will also gain an extra projection clock, needed to enable the synchronization of auction schedules between the export locations.

Between week 49 of 2009 and mid-2010, five of the eight cut flower clocks will switch to image auctioning. By the middle of next year this will bring the share of image auctioning for cut flowers to approximately 70 percent of the turnover. Product groups such as tulips, lilies and summer flowers have not yet been included in the plans for image auctioning.

In Rijnsburg, the auction room has been fitted with new, modern buyers´ benches and the number of clocks will be increased from six to seven (projected) clocks. Recently, the wall with the six ‘fixed’ clocks has been replaced with projection screens for seven clocks. After a transition period to become accustomed to this auction system the new auction schedule with seven clocks will start in week 49. Two of these clocks will work with image auctioning. The distinguishing feature of Rijnsburg is that buyers can purchase their entire assortment in one auction room. This is ideal for small and medium exporters. Large exporters can for example, choose to purchase their tulips at Rijnsburg.

Source: FloraHolland Newsletter (November 2009)

The EU construction sector is the most important market sector for timber and timber products and uses up to 70% of all timber consumed in the EU, followed by the further-processing industry (most notably the furniture industry). The DIY market segment is of less importance, although its market share in sales of timber and timber products is steadily increasing.

Consumption can be divided among the following market segments:

• Construction sector (e.g. housing, marine and civil engineering);
• DIY (Do-It-Yourself);
• Further Processing Industry: packing industry (e.g. pallets, boxes, crates and coils); Furniture industry (e.g. interior design and garden articles); Carpentry and wood-working industry (e.g. window frames, doors and stairs); Flooring.
• Paper and pulp industry;
• Wood energy.

Trends and developments
The short-term prospects for the EU timber market, mostly concerning the professional market (i.e. professionals/ service providers working in the timber industry), are rather negative. Hardwood consumption has been especially hit by the current economic downturn, thus increasing competition among exporters to, and traders in, the EU.

Global competition in the timber trade increased in the past few years. Demand is growing, driven by the growth in wood-processing industries in some Asian countries (particularly China) and Eastern Europe, as well as the increased importance of wood as a sustainable energy source. European government officials and key experts foresee a shortage of sustainably managed timber in the near future.

Certified timber
Forest Certification is both a system of forest inspection and a means of tracking timber and paper through a ‘chain of custody’ (CoC) – following the raw material through to the finished product. This is to ensure that the products have come from forests which are well managed – in terms of environmental, social and economic principles. In general, the market impact of certification has been far greater in Europe (and here only in certain countries) than in Japan or the United States of America.

FSC is an independent international organisation, established to promote responsible management of the world’s forests through standards setting, certification and labelling of forest products. In 2008, more than 100 million ha were FSC-certified, distributed over 79 countries; the value of FSC labelled sales was over € 13 billion (FSC, 2008). According to FSC International, the market share of certified timber and timber products in the EU is approximately 6-7%. Although this percentage varies significantly among the different EU countries and also depends on the product group, the market share is growing in all EU member states (FSC, 2008).

Source: CBI

To support further development of the both WAFEX and HELIX, ProVerde was asked to carry out a market study on the EU waxflower market. The market study particularly focused on obtaining insight into the distribution chain and leading sales channels for Waxflowers. What is the role of different types of wholesalers, bouquet makers, wholesale markets, types of retailers, etc. Where do waxflowers end up (main countries, players/buyers, market shares, preferences)? The study resulted in a number of ideas for future market and product development in terms of volumes, target channels and markets, and colours and variety characteristics.

Source: ProVerde

More and more EU entrepreneurs in this business are opting for offshore outsourcing, i.e. moving parts of the production process to developing countries (DCs). As they face increasing pressure to improve, many of them consider offshore outsourcing a strategic means of lowering production costs, increasing their own company’s capacity for products with a higher added-value outsourcing products with a lower added-value. While the number of fruit and vegetable growers in the EU has been declining for decades, their involvement in offshore fruit and vegetable growing is increasing.

Fruit outperforms vegetables
DCs play a very important role in EU fruit trade and a substantial, if smaller, role in the vegetable trade. In terms of volume, fruit imports from DCs also outperform vegetable imports. A major reason for this difference is the fact that the EU countries are highly dependent on imports, as some fruits are not grown in the EU, such as bananas or mangos, and others, such as citrus fruits, are only produced seasonally.

Opportunities and threats
The fresh fruit and vegetables market in the EU offers both opportunities and threats for exporters in DCs. The creation or adaptation of products that serve market segments and capitalise on trends in consumption, production and trade offers major opportunities. Obviously, tropical (super) fruits also offer good opportunities as they cannot be produced in the EU and therefore have to be imported. Likewise, products that can fill the EU supply gap during the off-season are likely to be successful. Organically grown products with a fair-trade label and developed in a sustainable manner will also readily find their way onto EU markets.

Source: CBI

• When France increased its VAT rate, it caused a 20% loss of sales. Lately, France has gone back to the reduced rate of 5.5%.
• In the UK, the VAT rate was reduced from 17.5% to 15% in December 2008 to stimulate consumer spending and, consequently, the economy. The VAT rate will be reviewed again in December 2009.

Source: European Commision (2009)