Geology And Geophysics

How the Iceland Volcano Impacted the Flower Industry



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"How the Iceland Volcano Impacted the Flower Industry"
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When Eyjafjallajokull (pronounced AY-uh-fiat-luh-YEU-koot-luh, with the 'EU' as in liqueur) began its second eruptive cycle on April 15, the resulting ash cloud grounded airplanes from the Mediterranean Sea to the Arctic Circle. As long as the eruption shows no sign of stopping, the ash cloud will continue to disrupt air traffic over most of Europe, northern Africa, and even parts of North America. In these high air traffic areas, jet stream forecasts have become volcanic ash forecasts.

But it's not just weary passengers who anxiously watch the skies, hoping for a break. Air cargo planes carry just 1% of the world’s international trade, but that 1% includes nearly all of its perishables.

Particularly hard hit are the flower industries of Africa, Asia, and Europe. Most European and North American florists rely on millions of African-, Dutch-, and Israeli-grown blooms to fill their shops, with flowers for special occasions and standard retail sale preordered up to a week in advance. While the Eyjafjallajokull ash cloud blocks the skies of Europe, all these flowers are going nowhere.

The shelf life of picked flowers is short. Storing them in refrigerated facilities can extend it a little. Once refrigerated warehouse space runs out, flowers which cannot be packed and shipped have to be thrown out. For this reason, many exporters have canceled pick orders, leaving farmers unable to sell flowers locally which have been grown solely for an export market. Even a short delay impacts the farmer. Once flowers are past their best bloom time, they have lost all value.

Nearly all of Europe's commercial roses, lilies, and carnations come from central Africa. Kenya alone exports 1000 tons a day of produce and flowers, a $922 million industry which accounts for 1/3 of all flower imports into Europe. Because the local market is almost non-existent after Valentine's Day, Kenya has had to throw away over 10 million flowers, nearly all of them roses. As many as 5000 Kenyan day laborers have lost their jobs as a result. Without sales, small business farmers risk defaulting on their operating loans. At times, the Kenyan economy was losing $3.8 million a day.

Dutch-grown tulips are a $40 billion industry with bulbs and cut flowers shipped all over the world. Bulbs are usually shipped by sea, but Friday night flights from Amsterdam to New York City bring enough tulips, peonies, and daffodils to cover the Flower District's needs for the week. However, there were no flights out of Dutch airspace on the night of April 16, 2010. During the following week, New York brides had no Dutch flowers for their weddings.

Israeli flower exporters were more fortunate. During the April 2010 eruption, the ash cloud never reached much further east and south than Italy. Israeli airspace remained clear, as was most of Eastern Europe. As a result, exports of Israeli-grown summer flowers were only disrupted for 2 days, April 17 and 18. After that, air transport of Israeli flowers was diverted to Madrid and Athens. From there, they were trucked to the rest of Europe.

African exporters are also developing alternate routes through Madrid to get their flowers to market. However, the extra expense of this route cuts exporters' already thin profit margins in half. This will probably translate into lower flower prices paid to the farmer and higher prices for the consumer.

Small businesses on the retail end take a hit as well.  If a North American florist manages to replace their flower order from other sources, such as South America, he pays a premium for not having preordered. The final cost of this premium will probably be shared between small retail operations and consumers. Larger, more resilient flower outlets may pass the entire premium on to the consumer.

Fortunately for the flower industry, the major air disruption caused by the Eyjafjallajokull eruption fell after Valentine's Day, and the next air travel disruption did not happen until on Mother's Day itself, well after the flowers for Mother's Day had already been shipped. The only major flower holiday which was directly impacted was Secretary's Day, which fell on April 21, 2010. Marigolds, violas, and local carnations must have been popular this year.

But the impact of Eyjafjallajokull's eruption on the flower industry may not be all bad. In many cases, domestic flower growers are experiencing unprecedented demand. Many small North American florists rely on domestic suppliers for much of their non-rose and non-exotic inventory, even before the Iceland ash cloud disrupted air traffic. Any further increases in sales are sure to lead to an unusually healthy bottom line. The only concern may be how to fill all the orders!

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