Green Industry Green Industry Situation and OutlookSituation and Outlook

2008 Southern RegionAgricultural Outlook

Conference

Ronald L. Rainey

Associate Professor/Extension Economist

What is the Green Industry?

Greenhouse and Nursery CropsGreenhouse crops Nursery CropsBedding/garden plants

Potted flowering plants

Foliage plants

Bedding & garden plants

Cut cultivated greens

Propagative materials

Broadleaf evergreens

Coniferous evergreens

Deciduous shade trees

Deciduous flowering shrubs

Fruit/nut plants

Palms

Ornamental grasses

Other woody ornamentals

Christmas trees

Vegetable transplants

Propagation materials

U.S. Greenhouse and Nursery Grower Cash Receipts, 1993-date ($1,000).

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

$14,000,000

$16,000,000

$18,000,00019

9319

9419

9519

9619

9719

9819

9920

0020

0120

0220

0320

0420

0520

06p

U.S. Greenhouse and Nursery Grower Cash Receipts, 2000-date ($1,000).

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

$14,000,000

2000

2001

2002

2003

2004

2005

2006

p

Floriculture Christmas trees Nursery

U.S. Greenhouse and Nursery Grower Cash Receipts, Regions ($1,000).

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

$7,000,000

$8,000,000

2003

2004

2005

2006

Northeast Midwest West South

Top 10 Greenhouse and Nursery States in Terms of Grower Cash Receipts, 2006p ($1,000).

       

  1. California $3,804,453  

  2. Florida 1,753,399*

  3. Texas 1,496,345*

  4. Oregon 1,040,452  

  5. North Carolina 1,026,509*

  6. Michigan 642,393  

  7. Ohio 604,438  

  8. Pennsylvania 411,441  

  9. New York 408,976  

  10. Georgia 400,000*

   

  Total Top 10 11,588,406  

   

  Total U.S. $16,891,934  

$0

$300,000

$600,000

$900,000

$1,200,000

$1,500,000

$1,800,000

AL AR FL GA KY LA MS NC OK SC TN TX VA

Greenhouse and nursery cash receipts, by Southern state, 2006p ($1,000).

Southern region represents about 37% of total U.S. production.

Grower Cash Receipts

• Annual growth is projected to be 0.3% for 2006. The market has slowed along with the economy. Even though the housing market is in a crisis, greenhouse and nursery product sales have remained fairly constant.

• The Southern region contributes the largest share of sales (approximately 38%) but experienced a decrease of 2.9% in grower sales receipts for 2006.

Floriculture Growers• Industry is continuing to transition with

growers exiting the industry, increased concentration and consolidation.

• Larger producers are getting bigger.

• Automation, economies of scale and specialization continue, with this trend being pushed by mass marketers.

• Finding quality, available labor continues to be a primary concern.

Greenhouse and Nursery Consumptionby household (Dollars).

$90

$100

$110

$120

$130

$140

$150

$160

$17020

01

2002

2003

2004

2005

2006

2007

p

Value of Greenhouse and Nursery Imports and Exports, 1994-date ($1,000).

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

p

Exports Imports

Imports

• Cut flower and nursery stock continue to dominate the greenhouse and nursery imports, which were up 8.3% and 2.2% for 2006, respectively.

• Cut flowers represent 53% of green industry imports.

Summary• The green industry continues to be a major sector

within U.S. agriculture (12%) and is of major importance to farmers, rural communities, and consumers.

• Imports continue to trend upward driven by the demands for cut flowers and nursery stock.

• Although the industry has maintained overall grower sales levels, the number of growers continues to decline.

Summary

• Higher Energy costs continue to dampen consumer spending including discretionary goods such as ornamentals,

• Inflationary pressures subdued demand, so prices of greenhouse and nursery crops will be unable to rise enough to combat higher production costs.

Summary• Niche branding along with value-added services and

products are emerging strategies for small growers to gain market share.

• Sustainability, certification products, and production systems are emerging as a method of market segmentation.

Questions?