The effects of Brexit will have a significant impact on the plant and flower trade. Currency fluctuation risks, with a further devaluation of the British pound, play an important role. It means that price sensitive products like plants and flowers become more expensive in the UK, leading to a decrease in consumption.
ABN Amro stated this in a report on the effects of the United Kingdom’s departure from the European Union. Dutch plants and flowers, as well as other agricultural products, have already become more expensive because of the devaluation of the British pound. The turnover of flowers in the United Kingdom is around 2 billion euro per year. Most of those flowers, around 90%, are imported from abroad according to ABN Amro, with the Netherlands as the number one supplier.
The import value of Dutch flowers is approximately 550 million euro. The bank pointed out that the lower value of the pound drove up the flower prices and led to a decrease in demand. And their forecast for 2018 is that the exchange rate of the pound will continue to go down.
Jan de Ruyter, sector manager horticulture with ABN Amro, wrote in the report: “The UK clearly isn’t self-sufficient when it comes to agricultural products. For most products, this isn’t going to change any time soon. The British people appreciate our products and our reliable service. That’s very valuable, even after Brexit. It’s important to strengthen our relations with British partners. The risks of higher costs, caused by currency fluctuations and increased import duties, are substantial. But there’s a strong focus on real food prices.”
