Latin Rose Growers Woo Valentine Market But US Competitors See Only Cupidity
ROSES brought home for Valentine's Day are mostly red -- but US rose growers are blue over a rising tide of imported flowers that they claim unfairly threatens their homegrown industry.Skip to next paragraph
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Foreign blooms, largely from South America, accounted for an estimated 60 percent of the roses sold in the United States last year. That's almost double the market penetration of 1986.
The US cut-flower industry has been clamoring for protection from foreign competition for years. They may get some, soon: In March, a US government agency will decide whether most foreign roses should be subject to permanent tariffs.
''We want to educate the public that a majority of roses being consumed in the US are from Colombia and Ecuador,'' says William Carlson, executive director of the Floral Trade Council, an industry trade association.
As this battle shows, the raising of cut flowers for sale is far from a gentle industry.
A grower who stops to smell the roses can quickly find himself out of business. Over the last 25 years, the number of rose growers in the US has fallen by almost 34 percent, to 213.
The raising of carnations, once a large domestic specialty, has almost ceased in the US.
Just a decade ago, roses were largely sold in flower stores, with large walk-in refrigerators holding vats of them. But fierce competition in recent years has greatly expanded the outlets selling flowers, with roses now available in grocery stores. In many cities, street vendors do a big business in roses, especially on Valentine's Day, the Super Bowl of the rose season.
Andean growers first began moving into the US market in the early 1970s, as improved transportation networks made shipment of such a perishable product viable. Their market share has marched steadily upward.
With cheap labor, abundant sunshine, and enough warmth to save on expensive greenhouse fuel, Colombian and Ecuadoran growers price their product an average of 30 percent cheaper than US growers, according to figures from the US International Trade Commission (ITC). In the last quarter of 1993, foreign growers were asking only 15 cents a stem for high-quality roses, according to an ITC survey. US growers, by contrast, were asking 36 cents.
Under such price pressure, ''65 percent of domestic rose producers were not profitable last year,'' says Tim Haley, president of Pikes Peak Greenhouses in Colorado Springs, Colo.
The domestic flower industry has launched numerous attempts to get the US government to label foreign competition unfair and subject Colombian and Ecuadoran roses to high duties. In the past these efforts have failed, in part because the spur of competition has helped push the volume of US rose sales much higher.
Late last year, however, a Commerce Department agency finally agreed that foreign growers were illegally ''dumping'' roses in the US at prices below their production costs. Temporary duties averaging 6 percent were slapped on stems from Colombia and Ecuador.
Sometime in early March, the International Trade Commission will rule whether this dumping has in fact materially harmed US growers. In the past, the ITC has judged that low prices from South America weren't the real problem; this time, says Tim Haley, ''we expect to prevail.''
SOUTH Americans are not happy about being slapped with punitive fees for engaging in what they consider to be free-market competition. US foreign policy, they point out, has long encouraged alternative agriculture in their countries, to wean farmers away from dependence on high-profit drug crops.
Free traders in the US also grouse at the duties, saying that the Commerce Department never found that South Americans were dumping until it changed its methodology. Trade figures can be used to prove anything, says Mark Falcoff, an economist at the American Enterprise Institute. Dumping laws ''have been used for cynical and self-interested reasons,'' he says.