Himalayan Flowers, Anyone?
Nepali businessmen are trying to develop an international market in Himalayan flowers and plants, but are finding that it is easier said than done.
The annual trade in cut flowers worldwide, including orchids and foliage, is estimated at over three billion dollars. Of late, entrepreneurs have been working to utilise the advantages of Nepal's midhill. climate and cheap labour to penetrate the world market, mostly in Europe and Japan, with flowers and pl ants which have their origins in the 'exotic' Himalaya.
"There is great potential for business if we can exploit our diverse climatic conditions and especially if we can develop the orchid industry," says Bijaya Bajracharya, who with a Japanese partner has invested heavily in Orchid Land, an enterprise which has started developing orchid hybrids for export.
Indeed, as Bajracharya says, there is a great deal of interest and curiosity about Himalayan plants and flowers in Western countries, but while producers based in Kalimpong and Sikkim have long dabbled in the trade, Nepali entrepreneurs are only now making their first furrows. However, they are stymied by a host of factors which range from lack of market access to absence of technology.
The bulk of the international trade in flowers is in mass produced species like Carnations, Roses and Chrysanthemums. Together, these constitute about 60 percent of the international trade in cut flowers. Next come the bulbiferous flowers such as Irises, Freesis, Narcissus and Tulips. Orchids have a market niche all their own, although it is not big. And it is in orchids that Nepali entrepreneurs see their future. For it is here, it seems, that Nepal will be best able to exploit its comparative advantages of soil, climate and cheap labour. Indeed, it is in orchids that growers in the Darjeeling hills and Sikkim have specialised for decades.
Nepal is home to some 90 genera and over 350 species of orchids. The species which have high export potential, both as cut flowers and as plants are Cymbidiums, Dendrobiums, Calanthes, and Coelogynes. These species and their hybrids thrive in the temperate Himalayan climate and are not found in tropical orchid-growing countries such as Thailand, Singapore and Malaysia.
Among these plants the Cymbidiums are. a much sought after variety. These plants have what flower consumers in the West love: long stems (for bouquets), many spikes, large numbers of flowers, and a long shelf life. Among its nine species, the Cymbidium giganterum, which flowers from autumn to early winter, is considered extra-exotic.
The Dendrobium is an 'aerial' orchid which is found commonly in Nepal, hanging from branches and rock ledges. Among its eight species, D.densiflorum (locally known as Sungava) is popular because of its golden flowers. The Calanthe, a ground orchid of ten species, has a good market in Japan. The Coelogynfrae is another epiphytic plant with ten species which has great marketing potential because of its silvery white flowers (known to Nepalis as Chandigava).
A 1989 study conducted by the Trade Promotion Centre in Kathmandu showed that these four species have a better market potential than other orchid species. Today, these are the four species that are exported to Japan, albeit in low volume.
Apart from orchids, the promising cut flower species with export potential from Nepal are the Carnation, Rose (such as New Dawn, Royal Highness and Blue Moon developed at the Royal Botanical Gardens at Godavari, Kathmandu Valley), Gladiolus, Iris, Narcissus and Chrysanthemum. Harvesting of these flowers has already begun, while other potentially exportable plants, such as Tulipa, Freesia and Gysophilia have yet to be tried in Nepal.
A Japanese horticulturist-turned-entrepreneur, Tor Kondo, has successfully grown tulips in the dry climate of the upper Kali Gandaki Valley. He says all 54 varieties of tulip seeds he brought from Japan have done well in experimental plots, and he believes that Mustang's dry climate holds the promise of growing tulip seeds cheaply for export to the West. Experiments at the Royal Botanical Garden in Kathmandu's more humid conditions, however, have not been as encouraging for large scale production of tulip flowers.
Today, even though the high value exports are to Japan and Europe, the bulk of Nepali flower and plant exports actually are to India. However, this demand for orchids in particular, is for their their medicinal rather than decorative value.
There is cut-throat competition in the international market, and some say high volume trade is impossible without a direct tie-up with an established importer. Flowers and orchids will have to be mass-produced, and this is where Nepal falls behind established exporters like Thailand or Sri Lanka.
Price, quality and delivery are the three important factors in international trade in floral products. The economies of scale being on the adverse side for Nepal, it is hard for Nepali producers to compete on the genera] flowers market. In addition, even though Nepal now has direct air links with Europe, the problems with unreliability and low frequency of flights mean that exporting flowers, one of the most fragile and perishable of cargo, is a problem.
The air freight charges out of Kathmandu are very high, making it difficult to compete with neighbouring countries like Sri Lanka and India which have long been exporting low-market flowers to Europe. While freight charges above 45 kg from Kathmandu is U$ 4.22 per kg, out of India and Sri Lanka it is only U$ 1.50 per kg. "Sri Lankan and Indian exporters are paying less than half as much for air freight, and that already is a great drawback," says Rajiv Pradhan, Managing Director of Botanical Enterprises, a company that exports orchid plants to Japan.
The fact that Tribhuvan International Airport does not have pre-export warehousing for perishables, particularly cold-storage facilities, is an additional problem for flower exporters. Also, airlines are reluctant to accept fragile and low density packages such as plants and flowers because of the associated problems of transport. In Thailand, incidentally, the government has directed Thai International to facilitate the growth of flower exports.
The problems of continuity of supply and reliability of transport are compounded in Nepal with the problem of consistency in product quality. Tice consumer demand is for flowers with long shelf life, which often requires pre-treating of flowers before packaging. Nepali producers are just beginning to realise this type of market demand.
One way of producing high quality, uniform and disease-resistant plants — and that too quickly — is to grow them through tissue-culture, a method of propagation which has long been used abroad. Conventional methods of growing plants from seeds and bulbs is outdated, and orchids, which have tiny seeds and are 'hard to grow, take better to tissue culture propagation. Although tissue culture is considered high tech, it is not beyond the reach of local producers. Tissue culture experiments have long been conducted by botanists at the Godavari herbarium. There are also five private tissue culture laboratories, but they have not been very productive so far.
Nurseries have yet to fill the demand for Himalayan plants and a significant part of the exported flora comes from the wild. There is in fact an illegal free-for-all on wild orchids, particularly in the forests around Kathmandu. This non-sustainable exploitation of wild orchids has already led to a dip in the export charts. Some unscrupulous exporters even pass off wild orchids as grown in nurseries, getting the necessary papers for customs clearance from Godavari. The CITES convention does impose restrictions on the trade of wild orchid species, but there are loopholes which allow such export to continue.
Today, the flower and orchid industry is concentrated in Kathmandu valley due to favourable natural conditions, access to local consumers, and presence of the international airport. But, with the scarcity of land becoming a limiting factor, entrepreneurs are eyeing the adjoining districts of Dhading, Nuwakot and Sindhupalchok.
The need for foreign collaboration seems to be essential if the floral trade is to develop, particulary in terms of technology and securing markets. The Nepal Investment Forum, a jamboree held in Kathmandu in early December to attract foreign businesses ended with a handful of Nepali flower people entering into tentative agreements with foreign partners. However, the NRs 20 million set by the government on faint ventures is too high, says Botanical Enterprises' Pradhan. Although capital is certainly necessary to set up a nursery, "for a fixed capital investment of four million rupees, you can have an annual turnover of 20 million."
The plant and cut flower industry thus has the potential of providing a high cost, low volume industry which is labour intensive and brings income to a rural populace. After garments and carpets, flowers and plants could be the next frontier for Nepali exporters. Eyeing the potential world market, Nepal's small band of flower businessmen recently formed the Nepal Floriculture Association with plans to develop the floral industry through Government support and development of indigenous capabilities.
The flower people, more than anyone else, are aware that a monopoly trade in Himalayan orchids holds promise of huge profits. But they also know that the returns will not come overnight. Like every other activity, the growing of flowers needs acculturation — one reason Sikkim and Darjeeling are ahead is that they have a long tradition of flower growing from the British Raj days. While research and experimentation can produce the finest quality of flowers commanding high prices, the long lead times can be frustrating in a country where businesses are attuned to quick (and small) profits. It can take up to two decades to come up with a viable range of flowers and plants for exports. But that is how, today, Colombia exports altogether 3 billion stems of Chrysanthemums to the West, at 25 cents apiece.
B.L. Shrestha is a reporter for The Rising Nepal.