Question and answers about Corona crisis

Anthos, KAVB, CNB, Hobaho and IGH are appealing to all market participants to maintain a sense of calm in the procurement market for spring-flowering bulbs

10 April 2020

By now, the Coronavirus has also cast its shadow on the upcoming purchasing season for spring-flowering bulbs. What will the harvest yield? What will happen to prices? What kind of effect will the outbreak of the Coronavirus have worldwide on the demand for flower bulbs and bulb flowers, and how will this affect purchasing? No one can predict the answers to these questions but it is clear that the turmoil among market participants is not only great but also increasing. This can be concluded from the many questions received by Anthos, KAVB, CNB, IGH and Hobaho. These organisations unanimously agree to the standpoint that a sense of calm has to be maintained to the greatest degree possible. They are asking sales personnel, purchasing agents and commission agents not to make any decisions that could have far-reaching consequences for the purchasing and sales positions of market participants. In addition, they are asking everyone to respect existing purchasing agreements. For their part, the trading companies are indicating that their buyers are in a very precarious situation due to the outbreak of the virus. It is now impossible for them to estimate what the effects will be on their future business operations and their demand for flower bulbs this autumn. (This applies to both sales of bulbs for forcing operations and dry sales.) Due to the very precarious situation being faced by their buyers as well as the high default risk, the trading companies are not purchasing any more of the conventional assortment at this time, another reason for this being that many of them have already committed themselves to more than 60 to 75%. Market participants are being called upon to keep each other properly informed about the developments regarding harvest and sales. It cannot be excluded that the trade will be confronted with a huge loss of demand due to the Coronavirus crisis. Although the trade itself is having to assume the highest risks for this, it could also have serious financial consequences for growers. In view of this, buyers believe it to be important in such cases for sellers to wish to cooperate with them in making changes to agreements signed before 15 March 2020. In this respect, the trade is considering agreeing to the delivery of fewer items, adjusting prices, or supplying a different variety. Anthos, KAVB, CNB, Hobaho and IGH are asking all market participants to consider each other’s position and to act together in seeking solutions for problems that could develop during this purchasing season for spring-flowering bulbs.