Imports continue to account for roughly two-thirds of the U.S. cut flower market due to the strength of the dollar and U.S. income growth as increasing global exports drive prices down, reports the U.S. International Trade Commission (ITC) in its publication Industry and Trade Summary: Cut Flowers.

The ITC, an independent, nonpartisan, factfinding agency, recently released the report as part of an ongoing series of reports on thousands of products imported into and exported from the United States. The report addresses the market, industry, and trade conditions for cut flowers from 1997 through 2001. Following are highlights of the report:

• Over the last two decades the U.S. market for fresh cut flowers has become increasingly served by imports. The United States is an important market for South American growers, especially those in Colombia and Ecuador, because of strong demand and high disposable income. These and other developing country producers have a competitive advantage over U.S. growers because of their low wage rates, smaller climate control investments, and cheaper currencies.

• Due to increased global supply of fresh cut flowers, especially roses, since the early 1990s, fresh cut flower import prices have fallen significantly. In the face of increasing low-priced import competition, many U.S. growers have shifted production to specialty cut flowers which are not imported in significant volumes and into other floriculture crops. U.S. production of roses and certain other flowers has fallen significantly. Sales by U.S. fresh cut flower growers, except in western states, have fallen to about one-half their 1992 levels.

• Almost 85 percent of total U.S. imports of cut flowers in 2001 entered duty-free under preferential trade programs. The majority of those imports entered under the Andean Trade Preferences Act, which benefits Bolivia, Colombia, Ecuador, and Peru. In addition to Latin America, governments in Africa and Asia have encouraged the development of cut flower export industries in their countries as a mechanism to employ large numbers of semi-skilled workers and to attract U.S. dollars to their economies. The Netherlands, Colombia, and Ecuador are the largest exporters of cut flowers in the world, however, eastern and southern African countries such as Kenya, South Africa, and Zimbabwe are becoming important players in the global cut flower export market.

The foregoing information is from the ITC report Industry and Trade Summary: Cut Flowers (USITC Publication 3580, February 2003). This report will be available in the Publications section of the ITC Internet web site at www.usitc.gov. A printed copy may be ordered by calling 202-205-1809, or by writing the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436. Requests may be faxed to 202-205-2104.

ITC Industry and Trade Summary reports include information on product uses, U.S. and foreign producers, and customs treatment of the products being studied; they analyze the basic factors affecting trends in consumption, production, and trade of the commodities, as well as the factors bearing on the competitiveness of the U.S. industry in domestic and foreign markets.