February 2010

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In my 31+ years in this industry, I don’t think I have entered a year with as much skepticism as 2009.  Now a year later, I’d like to offer a few thoughts on what I saw (or didn’t see) in 2009 and what 2010 holds in store for us in the green biz.

The economic crisis of 2009 was like most crises: dire warnings of total collapse that never happened, lots of folks pointing fingers and blaming each other, and a very tentative recovery to an economic mess.  I’ve lived through some good times and some bad times during my career.  Economic crises are never as bad as some people want us to believe; and this one was no exception.  Yes, we have too many unemployed and yes, we are all feeling the pinch of reduced earning power, but as I look back, it’s not as bad as it was predicted and better times are on the horizon.

Despite my optimism for the overall U.S. economy, I have never seen the nursery industry as depressed as it is right now.  With new home construction at a low ebb (and a lack of new community development projects and the supporting commercial construction that normally goes it), we see how closely joined at the hip nursery growers are to the construction of new homes and apartments.  Add to that the overall belt tightening among current homeowners, I predict we will see a consolidation of close to 20-25% within the woody plant nursery industry when all is said and done.  The nursery industry was over-produced and now it is time to pay the piper.  However, the greenhouse industry has apparently weathered 2009 in much better shape.  It seems homeowners still have the resources to buy a little color to plant around the house.  Couple that with a resurgence in home vegetable gardening, 2009 greenhouse product sales were steady and we certainly did not see the declines the nursery industry is suffering through.  The old mantra, ‘good weekend weather equals good flower sales,’ could not have been any truer than in 2009.

I’m not an economist, but one thing I think we often overlook is the power of the U.S. economy and the hard-working folks that put in their 40-50 hours per week to keep our economy chugging along.  Don’t forget that 90% of us are still gainfully employed.  As signs of life start to emerge throughout the economy – it can’t stay slumped forever – I am hopeful we are poised for growth sooner than later.  Slow growth to be sure, but growth none the less.  Now the finger pointing will start all over, except now the pointing will be directed at who’s responsible for successfully engineering the turn around.  I suggest, and history proves me right on this one, it’s the same group of hard-working optimists that have been keeping us afloat all along.

So what’s in store for 2010?  Those of us living along the Gulf Coast – from Texas to Florida and all the states in between – have endured one of the coldest winters in years.  I expect a demand for basic landscape plants this spring and summer to replace all the frozen, dead ones now littering landscapes everywhere (including my backyard).  I’ve always said that death and pestilence are good for our industry and southern growers should get a brief shot in the arm from this winter’s kill.  But that’s only a regional temporary fix.  The rest of the U.S. nursery industry will probably have one more year of sluggish nursery product sales.  If new home sales continue to gain momentum through 2010, then we will be poised for positive growth (pun intended) in nursery product sales in 2011.

Commercial greenhouse producers will continue down the same path in 2010 - good weather on the weekends will yield good sales.  Their business plan is simple: pray for good weather!

BASF has a lot to be thankful for.  We had very good sales year in 2009, mostly due to the growth and acceptance of FreeHand^® 1.75G herbicide and Pageant^® fungicide.  We also integrated the entire Whitmire MicroGen product line into our portfolio which resulted in one of our better sales years in recent history.  Stay tuned – BASF is poised to offer you more innovative products in 2010.  The slow economy has not dampened our innovative spirit one bit.  We look forward to serving you with more new products and more technical professionals joining our team.

Spring’s a comin’ – it’s grow time!