Roses are big money here in the Andes.
Both Ecuador and neighboring Colombia are deep in the business while flowers are chief exports.
This week I had the chance to sit down with a 14-year vet rose farmer at his place during my research for my soon-to-be-released Insiders Guide to Agro-businesses in Ecuador.
I’m also planning a little agro-investment of my own.
Ecuador roses are considered higher quality than the ones grown in most countries because they were grown at a higher altitude giving them a natural longer-lasting shelf life.
Grabbing his cup of tea, my friend began, “to start its much more profitable to buy comparable land and build your own farm from scratch.”
As most producing flower farms, if you can find one for sale, often go for a half million or more.
Start up costs, Investment
But thats the kicker, if you know where (and how) to look, my friend states, you can find land ideal for flower growing for around $15-20k per hectare.
And you’d need at least 3 hectares for the farm to be really profitable.
Once you acquire the land, my friend continues, you’d need to invest about $60-70k per hectare to prepare the soil and build the greenhouses.
$15k x 3 = $45k PLUS $60k x 3 = $180k TOTAL $225k on the low end.
Income and Production
You’d then be able to fit 80,000 plants per hectare.
And each plant gives one rose per every 3 months.
The roses sell to importers in the USA for around $.25 cents per rose FOB wholesale. Europe pays more, often offering around .35-.38 cents per rose.
My friend continues, “but you have to time your production right to hit the predictable demand surges (and price upticks) around western holidays like Valentines Day.”
My friend explains that organic fertilizers and other irrigation costs total about $1000 per hectare per month.
Plus you need about 8 pickers per hectare making the basic Ecuador wage ($340/month each) and you’ll need one sales manager ($1200/month), one production/farm manager like him for ($1500/month), one secretary (minimum wage $340/month) and one export coordinator ($5-600/month)who is in charge of filing all the paperwork needing during exporting and getting the permits.
3 hectare farm= 240,000 plants= 240,000 roses every three months = 80,000 roses monthly sold at the lower USA importer price of $.25 a rose = $20,000 net income.
Land and general production variable costs 3 hectares ($1000 per hectare per month) total=$3000 PLUS labor costs $1500+$1200+$600+$8500= $14,800
But with time as your retain the best pickers you can greatly reduce the number of pickers you need and reduce the labor cost even more if you manage your own sales.
Total (conservative) estimated monthly profit projection of 3 hectare flower farm = $5200.
There aren’t many risks to flower growing in Ecuador, that’s why its such a big industry.
If there is a frost, it would only kill the flowers, not the plant, but this obviously isnt common in Ecuador where here on the equator you can bank on the climate being the same and predictable all year round.
But unlike other crops in Ecuador where all you have to do is produce it and drop it off at the processor at the corner, and they’re guaranteed to take it, with roses you actually have to get out there and sell and hire a full-time sales manager or you could be left with unsold flowers on your hands.
What about the technical aspect of the actual flower-growing part (which you know nothing about)?
That’s what you hire a farm manager to do.
So where’s best to find land ideal for flower farming and the best farm managers?
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