Following the President Donald Trump’s new tariff decision, the US customs agents now began collecting tariff on all import goods from many countries, with 10% baseline tariff to higher levies on goods from 57 larger trading partners. One of the sectors that would be affected by USA new import tariff regime is floriculture industry. The possible impact of this measure on global floriculture business has been felt by many countries, and thus it is also impossible to hide or ignore its direct and indirect influence on Ethiopian Flower industry.
The floriculture industry of the US is heavily relying on import to meet domestic demand, especially for popular blooms like roses, summer flower and orchids. The daily demand for flower is very huge which is estimated to be 10 million stems. The country’s domestic flower production satisfies only 20% of local need and the rest 80% used to be filled by import. Since the country is unable to meet this supply space, different countries are looking for this potential market to fill this gap.
Ethiopia is one of African countries which strive to maximize its gain from USA flower market since long. The most recent statistical information of Ethiopian Customs Commission and various related reports reveal that out of the top ten flower market destination of Ethiopia, USA ranks 6th.
For the last 4 consecutive Ethiopian fiscal years, between 2020 and 2024, the volume of flower exported to USA market grew with an average rate of 25%. The total volume of flower supply to USA in these fiscal years was about 7,977 tons, with total turnover amounting about 45 million USD. This volume seems very large when compared to the actual quantities of flower supplied to Japan, Italy, Germany, Spain Canada and neighboring African countries. Ross, summer flower, rooted and unrooted cuttings are among the most important type of flower supplied to this market. Farms which supply their flower products are 7 in number and are all foreign owned.
Despite its importance, Ethiopia has not yet made a profound advance to make best use of the United States Flower market for various reasons. The flower exports to the U.S. have started since the beginning of 2005’s, but the country’s market share remains small, standing at less than 3%. The number of Ethiopian flower farms who has a strong market linkage to USA market did not exceed more than 11%. But this does not mean the new tariff regime has little impact on Ethiopian Floriculture Industry.
In comparison, Latin American countries had been more advantageous than Ethiopia to exploit the USA flower market for various reasons. One reason is their comparative advantage particularly Colombia and Ecuador, who are the world’s largest flower producers. Geographic location makes them ideal for exporting large volume of flowers with relatively cheap freight cost to the US, with quick and cost-effective transportation that enable them to ensure fresh flowers to reach the US market quickly.
The second reason is the US has free trade agreements with Colombia and Ecuador, which have facilitated the growth of the flower industry allowing for duty-free exports and increased competitiveness. The other reason is decades of experience in the flower industry has led Colombia and Ecuador to have a well-established supply chain and logistics, ensuring a reliable flow of flowers to the US market. Due to these reasons the leading flower producers have substantial comparative advantage than Ethiopia to exploit and reach out the USA large flower consumer markets.
Like other countries, Ethiopian floriculture is one of the industries that were cuffed by Trump administration’s tariff with 10% import rate. However, since Ethiopian flower producers have a feeble presence in the US market, USA not being their primary market, a tariff threat seems to have low impact to its exports and the US floral market.
Nonetheless the impact of this import tariff on Ethiopian Flower export remains to be seen. This is due to a number of reasons. Ethiopia’s flower relies on Netherland’s market which account for more than 67% share. Netherlands is among the strong flower business allies of Ethiopia not only for its domestic consumption but also for its effort to re-export to other countries. The new import tariff imposed on the Netherlands i.e. 20% means it significantly affects re-exported flower of Netherlands that essentially originated from Kenya and Ethiopia. Hence, imposing of 20% tariff on Netherlands export means reduction of its flower supply to US market which in turn would have a profound impact and significant implication on the opportunity of Ethiopian flower growers to maintain their sustainable supply to Netherlands as it was before.
We are also uncertain about the response and consequence of other countries to USA import tariff. As United Nations International Trade’s data base of 2023 reveals the market share of Latin American countries in Ethiopia has been growing in the past 3 years. Only in 2023, Ecuador exported 278 tons of flower to Saudi Arabia. Saudi Arabia, being the second largest market destination of flower next to Netherlands, constitutes 13% share. Shift of these two countries from US market to Saudi Arabia, as a response to new tariff means excessive supply of flowers to Saudi market that eventually reduces the price that the Ethiopian growers used to receive before.
United Arab Emirates is also a fast-growing cut flower market for Ecuador. Before the introduction of US tariff, Colombia was also a major supplier of cut flowers to United Arab Emirates, holding a significant market share, with data showing that it accounts for 27% of the UAE’s total cut flower imports. If Colombia shifts from US market to United Arab Emirates, it will definitely bring a great fatigue to Ethiopian growers, as UAE is the most important flower market destination for Ethiopian growers.
On the other hand, the major flower producing and exporting countries are significantly influenced even by baseline tariff rate or 10% rate. Colombia and Ecuador are the case in point. What makes Colombia and Ecuador unique from Ethiopia is that their market share in USA flower business is very big. Colombia supplies about 65% of flowers to the U.S. particularly roses and summer flower, which are in high demand year-round, especially around public holidays.
Similarly, Ecuadorian flowers, especially roses, which are essential to the U.S. floral industry, have a market share not less than 25%. Thus, since Trump administration-imposed 10% tariffs on these countries; it will strain business relation and raise the cost of imports. This would likely impact USA wholesalers and retailers who rely on Ecuadorian and Colombian flowers to meet consumer demands at competitive price.
Many critiques argue that this tariff significantly affects Ecuadorian and Colombian flower producers as the countries have a large market share in USA flower market channel. This tariff increases cost of imported flower goods and eventually passed on to consumers in the form of higher prices. Higher prices can lead to a decrease in demand for flower as consumers may shift to close substitute of luxury goods at cheaper alternatives and reduce their spending to buy flower. This in turn would discourage Ecuadorian and Colombian flower producers, creates supply vacuum and urges US wholesalers and florists to source more flowers domestically. Consequently, domestic flower growers will develop an appetite to expand and enhance local production.
While increased demand may benefit U.S. growers, many will eventually face challenges scaling production quickly. Domestic flower farming is labor-intensive and relies heavily on seasonal workers, often immigrant labor—a sector likely affected by the then immigration policies. Labor shortages could limit the industry’s ability to meet increased demand, potentially leading to supply shortages or higher prices.
On the other hand, expanding domestic flower production would require significant investment in greenhouses, transportation, and cold storage facilities. For medium and small farms, these costs may not be affordable, especially if labor shortages persist. Additionally, extreme weather patterns in the US can impact varieties’ availability further complicating efforts to meet year-round demand without imports.
Domestic growers may focus more on seasonal and regionally adapted flowers that thrive in specific climates, promoting a local-first approach to floral arrangements. While this could limit variety, it may appeal to environmentally conscious consumers who value sustainability.
This complex chain of response may reinforce itself through backward and forward loop with no tendency toward equilibrium in short run and each iteration of response reinforces the previous one and the cycle continues in the direction of moments until the market diversification is sought. This incident serves as a reminder of how interconnected flower trade, local business, and immigration policies can create uncertainty. While American flower growers may experience short-term benefits, the long-term implications for sustainable trade and international relations are far-reaching.
The flower producing and exporting firms who are expected to be affected by new import tariff of USA are hesitant to respond to this catastrophe due to the fact that the issue is very sensitive and still blurred for many. Yet, one thing is certain: floral industry which is once a symbol of beauty and celebration, has now found itself at the centre of a complex geo-political debate—one with consequences that extend well beyond Valentine’s Day bouquets.
Editor’s Note: Mekonnen Solomon is a horticultural export coordinator at MoA. He can be reached at ehdaplan@gmai.com.
Editor’s Note: The views entertained in this article do not necessarily reflect the stance of The Ethiopian Herald
BY MEKONNEN SOLOMON
THE ETHIOPIAN HERALD WEDNESDAY 9 APRIL 2025
