Breeders suffer from complete stoppage of royalty payments

Several breeders suffered from a complete stoppage of royalty payments by growers in the peak time of the crisis. Still, a significant amount of royalties remains open.

Some growers, especially of cut flowers, saw huge sales losses in some markets as the retail supply chain shut down in response to rules imposed worldwide to control the COVID-19 pandemic. Many flower growers had to destroy flowers, for which a royalty payment was due. Businesses throughout the chain have suffered and are working hard to recover. In contrast, some growers have had a good year. And in some countries, ornamentals sales have remained strong.

Unique challenges

President of the Association of Colombian Flower Exporters (Asocolflores), Augusto Solano, commenting on the situation said: “The industry in Colombia has faced a very difficult season with some growers having to destroy flowers. And there are much higher transport costs for flowers that are sold. We recognise the importance of paying royalties to maintain a strong supply of plant material. But we also call on breeders to recognise the unique challenges faced by growers this year.”

International industry organisations, AIPH, CIOPORA and Union Fleurs call upon growers and breeders to recognise the extreme financial challenges both groups are facing. And to recognise that royalty payments are imperative for the sustainability of ornamentals breeding and for stimulating the innovation growers and breeders need as they recover from the crisis.

The last to be paid

Secretary General of CIOPORA, Edgar Krieger, said: “It is concerning that breeders are often the last to be paid within a crop production cycle, because like any supplier they will suffer if contracts are not honoured. Breeders want to maintain good relationships with their customers, whether they are large or small growers, but they depend on the payment of their royalties for the continuation of their businesses”.

Secretary General of AIPH, Tim Briercliffe, said: “Some growers have had to bear the costs of extreme losses this year and many are facing significant financial challenges. It is clear that growers will rely on a sympathetic and understanding approach from their suppliers to keep them going through this difficult year.”

Working together

Secretary General of Union Fleurs, Sylvie Mamias, said: “All players in the global floriculture supply chain need to recognise the challenges that the COVID 19 pandemic has created in the industry. By working together to reach mutually acceptable business arrangements, the industry will be well placed to move forward to better times.”

In conclusion, AIPH, CIOPORA and Union Fleurs recognise the exceptional circumstances of this year, bringing challenges to both links in the supply chain. The organisations urge an attitude of increased understanding and fairness from both sides to ensure the rebuilding of a strong ornamentals supply chain for the future.


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