The world floriculture industry is in a state of unrest, with drastic changes in supply and demand positions. New markets as well as new suppliers are emerging and disappearing in short span of time. The growth potential of the industry though affected significantly by the recent global economic crisis; nevertheless, the global exports has been growing at an annual average growth rate of 10.3 percent, and at this growth rate world exports are expected to reach US$ 25 billion by 2012.

The world floriculture trade is characterized by a high degree of concentration by product and sources. Developed countries in Europe, America, and Asia account for more than 90 percent of the total world trade in floriculture products. International trade in floriculture, to a large extent is organized along the regional lines. Asia-Pacific countries are the main suppliers to Japan and Hong Kong. African and other European countries are the principal suppliers to Europe's main markets, and the supplies to the USA are mainly catered by Colombia and Ecuador. Further, traditionally, international trade in flowers has been considerably governed by bilateral/multilateral agreements and tariffs and quotas such as Generalised System of Preferences (GSP), Most Favoured Nation (MFN) tariff rates, NAFTA etc.

Estimates of the annual consumption of commercially grown flowers worldwide vary by source and range from US$ 40 - 60 billion. On the demand side, around 80 percent of the consumption is accounted for by six countries, including Germany, USA, UK, France, the Netherlands and Switzerland. While worldwide consumption has been on the rise, at the same time, consumers have also become more refined in demanding new products. For example, the Russian market and its preference for very large flower bud. In addition, niche markets in the Eastern Europe are becoming prime growth prospects. To meet this growing and changing demand, production has continued to move from countries that have traditionally been consumers and growers, such as the Netherlands, to other relatively new producing countries such as Colombia, Ecuador Kenya.
The shift in production locations has mainly been driven by the existence of more abundant labour and land, and has been made possible by developments in air transportation and refrigeration. The impact of increased competition on prices has been varied by region. While producers in Latin America have benefited from relatively constant prices in the US market, by contrast, in European markets the impact of new African suppliers has been reflected in a downward movement of prices.

In the recent years, two developments have had a significant effect on the global floriculture industry. The first is increased competition in production and distribution. In this regard, the established producers such as Ecuador, Kenya, Malaysia and Thailand have been expressing concern about the growth of the industry in China and India as China, in particular, is reportedly envisaging quadrupling annual exports of flowers to US$ 200 million or to more than a billion stems by 2010. On the distribution side, new flower centres have emerged in locations such as Dubai, Tel Aviv, and Kunming, China. These centres are forecasted to affect overall efficiency and lower transactions costs for distant producers, resulting in increased pressure on prices of cut flowers and foliage.

The second important development, to a large extent is linked to increased competition and considerable progress that has been made in consolidation and vertical integration. For instance, the merger of the two largest Dutch cooperative flower auctions (FloraHolland and Bloemenveiling Aalsmeer) has given rise to the world's largest flower market place called FloraHolland, with combined sales of about US $ 4.68 billion. Furthermore, increase in trade through the direct sales channel such as supermarkets and retail outlet has resulted in drastic changes in distribution channels. Worldwide large retailers such as Wal- Mart and Tesco have increased the amount of purchases acquired directly from the growers under long-term contracts. As a result of which, the producers have also integrated. For example, Dole Fresh Flowers has its own chartered for flowers for daily deliveries in the USA.
With regard to production, the competition in the floriculture industry is fierce, continuously testing the adaptive capacity of the actors involved. There has been a levelling off of the competition on technological grounds over the last few years. However, infrastructure and policy support have become important parameters in judging the competitiveness in international markets. There also has been a motivation to breed hybrids and new varieties. Major selling agents of breeders have realised increased sale of planting material while reducing the prices. The industry is witnessing healthy exchange of breeders' material and collaborative breeding programmes around the world. Such initiatives are getting further momentum due to protection policies for new plant varieties under TRIPS (WTO). Respecting plant patent rights is thus becoming an important parameter to establish global credibility and access to the latest varieties.

Floriculture activity has been traditionally attracting newer participants. However, only alert market participants have been witnessing success, as the product is highly perishable and vulnerable to quality parameters, and price fluctuations including intra-day price fluctuations. Productivity is a crucial aspect in this industry. Hence, successful producers have been investing in more labour-saving techniques in order to continue making profits. Quality is of paramount importance in the international trade of floriculture products. Producers, thus, need to conform to stringent phyto-sanitary requirements and must ensure that their produce is free from disease and that it is carefully treated once harvested. Further, consumers are becoming better informed and socially and environmentally conscious leading to higher demands on service guarantees, corporate responsibility related to flowers sold, and increasing number of codes of conduct becoming prominent in the flower trade such as the Dutch milieu programma sierteelt (MPS), Flower Labelling Programme (FLP), Fair Flower and Fair Plants label (FFP), etc. To guarantee a minimum number of days of vase life supermarkets and other competitors demand reduction in supply lead time.

Floriculture marketing is also undergoing significant changes. As supermarkets are more focused on maximising volumes and efficiency in logistics, there is a little room for tailor-made products or delicate flowers and plants that cannot be handled in standard systems. This has been giving rise to a growing trade channel and opportunity of specialised florists and products in the floriculture markets, such as that of weddings, funerals, corporate events, and for offering exclusivity and creativity. A development that is to surely change the floriculture industry is the emergence of the online sales channel - a marketing channel that is steadily growing in the recent years with increasing urbanisation, and a culture of 'saying it with flowers'.
Many small units have been facing problems due to uneconomic returns and high overheads leading to reorganization and restructuring of product portfolios by entrepreneurs, which has been considerable during the recent economic slowdown. However, there is ample scope for even small and marginal entrepreneurs to exploit the global demand of flowers with improvements in quality of planting material, infrastructure, training programmes in production, harvesting and post-harvest management techniques, product diversification, improving product availability and quality, and backed by adequate marketing support.