Issues and Trends
The New Zealand Flower Industry Federation Inc (FloraFed) is currently able to carry out only limited policy and representation work due to reduced funding following the rejection of the Commodity Levy in 2001. FloraFed is still trying to regain grower support. However, the smaller, specialised industry product groups and regional bodies appear to remain strong.
Levies to join FloraFed are $133.33/grower and product groups are charged only $200 to be affiliated with FloraFed, down from $1,000 in 2002. FloraFed needs 400-500 members to continue and at present only has about half this number. It is believed that this will restrict future growth opportunities for the industry. For example, promotion and marketing continues to be carried out on an unco-ordinated and individual basis by small product groups.
The two major local auction houses did not follow up the 2002 national Valentine's Day radio promotion. They believe it needs $50,000-$60,000 for a promotion of this size and such a promotion was not financially viable for this year as no levies were collected. The Flower Promotion Trust contributed $20,000 in 2002.
Research is occurring for floriculture crops, but on an individual product group basis which limits the ability of the industry as a whole to access appropriate funding levels. Currently the MAF Sustainable Farming Fund is financing the following three floriculture projects:
- The development of a calla lily growers' strategic business cluster is being investigated, which has the potential to increase employment and exports from the Northland region. An associated subscription-based website at www.callas.net.nz provides a wide range of growing and business advice for $195 plus GST.
- The Northern Flower Growers Association is working on a quality assurance project. The system will provide quality flowers that have been produced using environmentally sound practices and that can be traced from point of sale back to the point of production. This will help increase consumer confidence when buying flowers, with improved and consistent flower quality being produced. Trials are to start with some growers in July 2003.
- The Clutha District Council and southern New Zealand bulb growers have started research into enhancing opportunities for bulb growers in that region. This area has a cool climate and excellent growing conditions, which provide growers with significant opportunities to supply bulbs, such as tulips, to Holland and Japan for out of season markets.
Other industry-wide research under way includes the following:
- Methyl bromide is a widely used soil fumigant and is sometimes used pre-shipment for export. It is due to be phased out for use as a soil fumigant by 2005 under the Montreal Protocol. Research is continuing on suitable replacements for this chemical with methyl iodide a possible substitute.
- HortResearch and Crop & Food Research continue to work on a number of projects including:
- the biological control of soft rot, which is a major problem for the calla industry (Ruakura);
- the fumigation of cut flowers in a vacuum chamber, in association with a local grower (Crop & Food Research, Levin);
- the way peonies store sugar and starches to get a better understanding of plant health and disease resistance (HortResearch and New Zealand Paeony Society Inc.); and
- a new post-harvest facility used to trial and optimise storage and transit temperatures for different floriculture crops (HortResearch, Mt Albert).
Several factors in the freight sector have impacted on the New Zealand flower industry. Local freight costs have increased, especially from the South Island. It is costly for growers to send flowers to Auckland, from where most export shipments depart. The war in Iraq and SARS have resulted in some airlines withdrawing from New Zealand and many cancelling flights in 2003. This has reduced freight capacity and limited the frequency on the Auckland to Los Angeles route.
Logistical problems are predicted at the peak capacity time of October to December 2003 for key markets when there is increased competition for space with other agricultural/horticultural exports.
The proposed merger of Air New Zealand and Qantas would give the two airlines a monopoly on the Auckland to Los Angeles route, which is the third most important destination for New Zealand flowers after Japan's Narita and Osaka airports. If the proposal proceeds, growers are concerned that Australian exports would take precedence.
A new density rule (Rule 502) was proposed by the International Air Transport Association (IATA), that would have resulted in a 20% increase in air freight rates for flowers. The decision on this issue has now been deferred until October 2003, but this matter could have a significant impact on exports next season.
Contact for Enquiries
Farm Monitoring Programme Manager
Monitoring and Evaluation
MAF Policy
PO Box 2526
Wellington
NEW ZEALAND
Phone: +64 4 894 0623
Fax: +64 4 894 0741
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