AN ECONOMIC ASSESSMENT OF FIELD-GROWN FLORICULTURE CROPS Executive Summary Floriculture refers to the cultivation and management, usually on a commercial scale, of ornamental and flowering plants. The Census of Agriculture, which is the main source of data for the industry, defines floriculture crops as including bedding plants, foliage plants, potted flowering plants, cut flowers, and cut cultivated greens. The Census reported $3.5 billion worth of floriculture crops grown on 25,477 U.S. farms in 1992. Floriculture production that year covered about 656 million square feet of land under protective cover and 61,000 acres of open-field land. The Economic Research Service estimated that wholesale floriculture sales in the United States totalled $5.7 billion in 1992. Most foliage and flowering plants are sold in containers. However, some are grown in-ground for a period of time before they are transplanted into containers. These plants are part of a grower's in-field inventory while in the ground and could be covered by an in-field crop insurance policy. The extent of in- ground production depends on the climate and the type of floriculture crop. Among the floriculture groupings, cut flowers and cut greens are the most likely plants to be grown in-ground for an entire life cycle. Bedding plants are at times grown in the open field for the entire production cycle. Some field-grown foliage plants and potted flowering plants are grown in the ground for a period of time and then transplanted into containers. Dracaena, ti-leaf, sansevieria, and ficus are some examples of foliage plants that can be grown in-ground. In addition, potted chrysanthemums sold at garden centers and discount stores (Wal- Mart, K-Mart, etc.) during the fall are usually grown in the ground for a period of time. Examples of field-grown cut flowers are cut snap dragons, stock, orchids, and gladioli, while cut cultivated greens include cut leatherleaf ferns and chamaedorea. U.S. domestic floriculture production had an estimated farm value of $3.7 billion in 1993, up 56 percent from 1986. Wholesale cash receipts for floriculture products, including the value of imports, were estimated at $6.1 billion in 1993, up from $3.9 billion in 1986. U.S. retail purchases of floriculture plants have risen almost consistently since 1986. Consumer purchases totalled $12.6 billion in 1993, up 47 percent from 1986. Retail expenditures for floriculture products were approximately $36 per capita in 1986 and $49 per capita in 1993. The demand for floriculture products, especially the demand for cut flowers, is highly seasonal. Sales are greatest from February through May, and during the fall, and lightest during the summer. Sales of cut flowers peak around holidays, such as Valentine's Day and Mother's Day. Cut flowers and foliage plants, however, are becoming increasingly popular for everyday use. Most ornamental foliage plants are tropical and do not tolerate freezing temperatures. Foliage plants may begin to show signs of slow growth or plant damage as temperatures reach 90o F and above, or as they drop below 50o F. Hot, humid weather is an often-cited barrier for cut flower production. Many varieties do not bloom at all or are of poor quality during hot weather, especially when night-time temperatures remain high. Floriculture crops can be produced on many soil types, but a fertile soil with good drainage and good aeration is ideal. Most cut flowers grow best if there is some organic matter in the soil. For a few species, such as most wild flowers, ferns, alpine plants, and desert plants, a less fertile soil is best. Poor aeration can reduce plant growth or kill the plant by restricting the absorption of water and nutrients by the roots. Most growers use irrigation. The major production perils confronted by in-ground floriculture producers are excessive rain, high winds, and freezing temperatures. Excessive rains and high winds are a particular problem in the coastal areas of Florida and Texas. The extent of insect and disease problems varies across areas but, in general, these problems can be controlled through prudent management practices. Our assessment is that most growers who will participate in a potential in-field crop insurance policy for floriculture crops will only apply for the minimum catastrophic coverage. However, growers whose farms are located in areas prone to hurricanes, such as the Coastal counties in Florida and Texas, will likely opt for a higher coverage. The greatest interest in purchasing buy-up insurance for in- ground nursery crops will likely be from cut-flower producers, particularly those from Florida, Texas, and California, where heavy rains and freezing temperatures can be a problem. Ad hoc disaster payments data provide further evidence that the greatest interest in insurance may lie with growers in the South. A large amount of ad hoc disaster assistance payments for floriculture crops were reported in the South over the 1988 to 1993 period, a majority of which were collected by Florida growers. Most of the losses were due to strong winds and floods from hurricanes and freezing temperatures. Except for cut flowers and cut greens, the southern region received at least 90 percent of total disaster assistance payments for floriculture crops. Because there are few growers of in-ground floriculture crops, the potential market for such a policy is limited. Some floriculture crops are grown in-ground and exposed to full sun for some period during their production, but a large proportion of floriculture crops are produced in some type of container throughout their life cycle, and these would be covered by the policy for containerized plants. The major floriculture crops grown in-ground for an extended period are cut flowers and cut greens.