FLORICULTURE AND NURSERY CROPS YEARBOOK -- SUMMARY  June 18, 2003
June 2003, ERS-FLO-2003

        Approved by the World Agricultural Outlook Board
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This SUMMARY is published by the Economic Research Service, U.S.
Department of Agriculture, Washington, DC 20036-5831.  The text of
the yearbook will be available electronically about 1 week
following this summary release.
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Green Industry Sales Are Flat

While grower sales of floriculture crops increased 1.6 percent in 
2002 from 2001, nursery crop sales fell by a marginal amount. 
Together, floriculture and nursery crops, also known as the green 
industry, reached $13.8 billion in sales in 2002, up from $13.7 
billion in 2001. After accounting for imports and exports, 
domestic consumption of floral and nursery crops is up only 
slightly in 2002. However, on a per-U.S.-household basis, 
consumption is down to $136, from $137 in 2001.

The weak U.S. economy in 2001 and 2002 is largely responsible for 
flat grower sales in the green industry. Although floriculture 
crop sales have continued to grow, albeit slowly, nursery crop 
sales, which are about twice the size of floriculture sales, are 
flat. Among floriculture crops, only bedding and garden plants 
and foliage plants registered sales gains, raising floral crop 
consumption up 1.5 percent to $5.6 billion in 2002. Cut flower 
imports fell in value even as import volume rose, due in part to 
the high exchange rate of the dollar. U.S. consumption of cut 
flowers has been on a downward trend, now $8 per household 
compared with $10 in 1999.

Bedding and Flowering Plants Lead Floriculture Sales

Two-thirds of the value of U.S. floriculture production in 2002 
consisted of bedding and garden plants and potted flowering 
plants. These plants led U.S. sales growth among the six 
floriculture subsectors, which also include cut flowers, foliage 
plants, cut cultivated greens, and unfinished propagative 
material. In 1990, bedding-garden plants and potted flowering 
plants comprised only 55 percent of total U.S. floriculture 
production value. Their relatively faster growth over the past 
decade is due in part to reduced demand for domestic cut flowers 
and cut greens. Although demand for foliage plants continues to 
increase, their sales growth has been relatively slower.

Imports of flowering and bedding plants, largely from Canada, 
have also risen rapidly in recent years, helping consumption of 
floriculture crops per-U.S. household reach $52 from $32 in 1990. 
The largest producers of bedding and garden plants are 
California, Michigan, Texas, Ohio, Florida, and New York, each 
exceeding $100 million in sales in 2002. The production of potted 
flowering plants is dominated by California and Florida, whose 
combined sales were 36 percent of U.S. growers sales of potted 
flowering plants in 2002.

Most States produce more bedding and garden plants than any of 
the other floriculture products. One major exception is Florida, 
whose growers collectively produce and sell more foliage plants 
than any other State. Indeed, Florida produces almost 70 percent 
of total U.S. foliage plant production, which is not unlike 
Californias two-thirds share of U.S. cut flower production. 
Florida produces about four times more foliage plants than 
flowering or bedding plants, its next largest green product.

Growers in the South and West Have Largest Sales

California, Florida, and Texas all exceeded $1 billion each in 
sales of green crops in 2002. Since growers in these States also 
sell their products in other States, green sales per-U.S. 
household by growers in the four largest States are also the 
highest among all States. Together, sales by these four States 
accounted for 53 percent of the total U.S. green industry output 
in 2002.

Growers in the Southern and Western States produced 75 percent of 
all green crops in 2002. However, led by Michigan and Ohio, 
growers in the Midwest produce and sell a relatively large 
portion of total U.S. bedding and garden plants. Only growers in 
California sell more bedding and garden plants than Michigan 
growers. But with respect to herbaceous perennial plants, South 
Carolina is the sales leader.

Growers in the Midwest generated the highest sales per acre of 
production area--averaging more than $104,000 in floriculture 
sales in 2002. This compares with $92,000 in the Northeast, 
$80,000 in the South, and $77,000 in the West. Individually, 
however, growers in Colorado claim the highest sales per acre of 
floriculture crops in the United States--almost $300,000 in 2002.

Florida has the largest production area for floriculture crops--
close to 18,000 acres in total--about as large as the combined 
growing areas of all States in the West, including California, 
and twice as large as the Midwests total production area. 
Although Californias total greenhouse cover is close to twice 
Floridas, the latters share of total U.S. use of shade and 
temporary cover is 82 percent.

Floriculture Growers Continue To Decline in Number

There were 12,717 growers of floriculture crops in the United 
States in 1997. In 2002, the number of growers has declined to 
10,216. While the number of both small and large growers has 
fallen, the average sales of large growers now exceed $1 million, 
compared with only $46,000 for small growers. (Large growers have
$100,0000 or more in annual floriculture sales at wholesale, and 
small growers have between $10,000 and $100,000 in annual 
floriculture sales.) The largest average sales are by growers in 
the West, followed by growers in the South. Among large growers, 
those in South Carolina averaged more than $2.25 million sales in 
2002, the highest in the 36 surveyed States. The next highest 
average sales among large growers were $1.84 million in 
California.

As floriculture sales of large growers continue to expand, sales 
by small growers have been shrinking since 2000. Large growers in 
the West and South produce and sell about twice the crop value of 
their counterparts in the Midwest and Northeast. Average sales of 
small growers are highest in the West.

The total production area for U.S. floriculture crops in 2002 was 
just under 58,000 acres. This is down from 1998s 68,500 acres of 
production area. About 36 percent of the production area in 2002 
was under covered protection, either under greenhouses or under 
shade and temporary cover. The rest of the crops are grown in 
open fields. Southern growers, principally in Florida, have 
bigger production areas under cover than growers elsewhere. While 
growers in the West also widely employ covered protection for 
their crops, growers in the South use more shade and temporary 
cover than greenhouses with rigid structures.

About 72 percent of the U.S. production area for floriculture 
crops is in the Southern and Western States. And of the U.S. 
total area under covered protection, 75 percent is in the South 
and West. Plants grown under covered protection include 
seedlings, immature, and unfinished plants, as well as high-value 
plants such as orchids and other tropical flowers. The decline in 
the size of total production area under covered protection in 
recent years is due in part to flat overall sales and to 
increasing outsourcing of seedling and propagative material 
production to growers in Central America and Mexico.

Cut flowers--Almost all the major cut flowers have experienced 
declining sales in the past decade. Although imports have 
supplanted domestic-grown flowers, such as roses and orchids, the 
import values of carnations and chrysanthemums have also fallen. 
The reason behind these downward trends is the general drop in 
U.S. demand for cut flowers since 1997 when total cut flower 
supply and consumption peaked. Relatively higher priced domestic 
cut flowers helped shift demand toward imported cut flowers and 
other domestic grown floral crops. Thus, while the import share 
of U.S. cut flower consumption remained around 60 percent, 
domestic cut flower production continued to recede. U.S. growers 
instead shifted production toward potted flowering plants, 
bedding and garden plants, and foliage plants.

Bedding and garden plants--As U.S. demand for floriculture crops 
other than cut flowers increased in the 1990s and continued to 
grow in recent years, domestic production of flowering, bedding, 
and foliage plants responded accordingly. Although still 
relatively small as a share of consumption, imports of these 
plants have also risen sharply, especially as the dollars 
exchange rate has risen. Thus far, most of these imported plants 
are produced in Canada since restrictions related to plant 
diseases and pests largely constrain imports from other 
countries, especially plants with soil attached to roots. 
Consumption of flowering, bedding, and foliage plants is now $43 
per-U.S. household, up from only $22 in 1989 and $30 in 1995.

Nursery crops--U.S. production of nursery crops was estimated at 
$8.9 billion in 2002, 83 percent larger than floriculture crop 
production. Per-household consumption was $84 for nursery crops 
and $52 for floriculture crops. While per-household consumption 
of floriculture crops continues to increase, that of nursery 
crops appears to have peaked in 2001. The U.S. economic recession 
in 2001 and weak growth in 2002 are partly responsible for the 
subdued demand for nursery crops, despite strong U.S. housing 
construction activity. Imported nursery crops, largely live 
plants and nursery stock, are still an insignificant fraction of 
U.S. nursery crop consumption at 3.3 percent. Growers in 
California and Texas produced 36 percent of the countrys nursery 
crops in 2002 based on sales of $2.1 and $1.1 billion, 
respectively.

U.S. green imports--Cut flower imports are 48 percent of total 
U.S. imported green products, which were $1.1 billion in 2002. 
This import share is down from 60 percent in 1996 when cut flower 
imports per-U.S. household were $6. Cut flower imports are now 
down to an average $5 per household. Imported nursery stock, 
bulbs, etc., on the other hand, have been expanding continuously. 
As recently as in 2000, these nursery crop imports were less in 
value than cut flower imports. In 2001, nursery crops first 
exceeded cut flowers in value, and are now 52 percent of total 
U.S. green imports.

The bulk of imported cut flowers come from Colombia, Ecuador, and 
the Netherlands. Colombia supplies most of the imported roses, 
carnations, and chrysanthemums, while Ecuador ships more roses 
than other cut flowers to the United States. The Netherlands is 
the prime source for tulips. Canada and the Netherlands supply 
three-quarters of U.S. nursery stock imports. Live trees and 
plants largely come from Canada, and bulbs of tulips, lilies, and 
narcissus are from the Netherlands.

U.S. imports of propagative material--unrooted cuttings and slips 
of plants--ballooned by 400 percent in value from 1992 to 2002. 
Attracted by lower production costs and favorable climate, these
immature plants as well as unfinished seedlings are grown
initially in Costa Rica, Guatemala, and increasingly in Mexico. 
After shipment into the United States, they are further grown to
maturity and final sale.