Altmann continued: "Great Britain also accounts for a large proportion of the general rise in demand for flowers and plants in the EU. Great Britain exerted an extremely positive influence on that slight increase in the turnover resulting from sales of flowers and plants in the EU which was registered in 2015, i.e. by 0.5 per cent in total to Euro 32.4 billion. The trading partners, particularly from the Netherlands, are correspondingly nervous about the as yet unforeseeable effects of Brexit.
"One interesting fact is that the British traders are keeping the consumer prices of flowers and plants on the same level as in the previous year in spite of the devaluation of the British pound (more expensive purchasing). At present, the selling prices are thus being 'subsidised' or compensated for at the expense of the British flower traders' own profit margins. Therefore, the problem has been borne by the British traders until now - for how much longer?
"Although this sales behaviour is preventing declines in turnover and is leading to constant sales figures, it will put the Britons off trading in flowers and plants in the long term. At the latest when additional customs duties are imposed and the lead times are delayed, the goods imported from the EU until now will become increasingly unattractive to the British traders. Many of them will look for solutions. In this respect, three scenarios are conceivable."
1) Passing the more expensive purchasing prices on to the ultimate consumer: The traders increase the final selling prices of flowers and plants corresponding to the exchange rate losses with the dangers that the Britons will generate a lower demand for the products and the demanded quantities will decline. In the long term, precisely the customers of the specialised retail trade will be unable to avoid increases in the selling prices if they still want to afford the 'expensive' goods imported from the EU.
2) Extending the trade relationships to and direct imports from suppliers in third-country states: Trading companies which, as individual companies or as purchasing cooperatives, are large enough to be able to buy their goods directly in the production countries in Africa and Central America will set up corresponding trade relationships, will divert their flows of goods as direct imports and will no longer take the route via the Netherlands. In the case of this scenario, it will be interesting what customs duties will be applied later on and what effects these will exert on the direct imports.
3) Extending the domestic production: The British producers could extend their production. Because of the energy and cost situations, a domestic extension is rather unrealistic but conceivable on a small scale.
"Thus, it must be feared that the trade in flowers and plants inside the EU will inevitably come under pressure in the long run because of Brexit. In expert circles, it is being assumed that the major effects of Brexit will only become discernible in two years.
"Precisely the central purchasing departments of the supermarkets such as Tesco, Asda, Aldi, Lidl and co. which already have market shares of over 54 per cent for cut flowers and 32 per cent for house plants in Great Britain at present will look for purchasing alternatives and service providers outside the EU and contribute to an alteration in the flows of goods. The trend towards direct imports of the system trade can already be observed throughout Europe and will be accelerated once more in Great Britain due to Brexit.
"In this respect, the British purchasers will certainly focus on countries such as Kenya, Colombia, South Africa, Turkey, Israel and Morocco even more strongly than until now. Nevertheless, uncertainty is prevailing in these countries, too. Above all, the Kenya Flower Council is thus afraid that the access to the markets in the EU and Great Britain will turn out to be more complicated with regard to the customs duties and the flows of goods. The uncertainty may primarily be explained against the background that, in the "East African Community", Kenya was about to make a breakthrough in the summer of 2016 in relation to the implementation of essential trade facilitation measures with the EU."
Dutch flower wholesalers have intensively been on the lookout for new sales markets since Brexit - USA, China, Mexico, Brazil or Argentina. China could treble from Euro 5.5 billion at present to Euro 16.5 billion.
IPM added: "Against this background, Royal FloraHolland's export targets of wanting to raise its export value from Euro 10 million at present to Euro 200 million in 2020 might be realistic. It remains to be seen to what extent other EU states will be allowed to and will participate in the upswing and in a "Made in the EU" designation."
"In 2016, Brexit and Russia are two dominant subjects whose effects will only be shown in the long term. Nobody should rely upon everything turning out alright. All the countries will do well to set up alternative sales channels and target markets for themselves, even if it is by intensifying existing trade contacts inside or outside Europe. Due to these reorientation measures, it may be assumed that, in 2017, the flows of goods will alter in conjunction with changing consumption behaviour in a few EU countries.
"In this respect, the increasing direct purchases from the major central trading organisations in the production countries will certainly be a driving force."
EUROSTAT said in 2015, a total of 504,952 tonnes of flowers and plants (+ 8.2 per cent) worth Euro 1.68 billion (+ 5.3 per cent) was imported by the EU. As in the previous years, the cut flowers which account for 78 per cent of the total imports into the EU are mainly responsible for the rise in the imports.
Kenya had 27 per cent of imports to the EU, followed by Ethiopia, Ecuador and Colombia.
Export countries such as Israel, the USA and Costa Rica are displaying a declining trend.
According to EUROSTAT, 664,000 tonnes worth Euro 1.98 billion of flowers and plants were exported from the EU in 2015. In comparison with the previous year, that is a decline of 3.1 per cent in quantity but are up 5.1 per cent in the value.
Trade surplus is Euro 300 million of flowers and plants, mainly because of exports of flower bulbs and tubers from the EU.
Russia and Switzerland remain the non-EU countries with by far the strongest demand for EU flowers and ornamental plants. In 2015, the EU exported, in each case, 20.5 per cent of the export value to Russia (compared with 21.3 per cent in 2014) and to Switzerland (compared with 20.7 per cent in 2014), followed by the export markets of the USA (11.2 per cent), Norway (8.2 per cent) and China (5.9 per cent).
Countries such as Turkey, Ukraine, the United Arab Emirates or also Japan are being courted to an increasing extent.
Positive Dutch exports persisted in the autumn of 2016, after 2015 had already yielded a record export value of Euro 5.6 billion. "Nevertheless, uncertainty is spreading around the European market in 2016. Brexit and Russia are the central subjects in this respect," said IPM.